How Do I Choose the Best Telecommunications Provider?

Telecommunications facility provider refers to an enterprise that mainly manufactures, sells, and services telecommunications equipment. It is often referred to as a telecommunications equipment provider or telecommunications equipment manufacturer and communications equipment manufacturer, such as Cisco in the United States. , Sweden's Ericsson, Germany's Siemens, China's Huawei, ZTE and so on.

The telecommunication industry is not only closely related to people's daily life, but its existence and development also occupy a very important position in the national economy, so it often becomes the focus of people's attention. Enterprises in the entire telecommunications industry are basically divided into three categories ^[1]

In the 1960s and 1970s, the number of equipment providers was still very small, and they were classified according to the different products they produced. Major switch manufacturers include Alcatel, Ericsson, ITT, Siemens and Western Telettra. Others, such as Lenkurt, Marconi and Telettra, are known for transmitting products. Almost all products are developed in-house, and the measurement of value for these companies depends largely on their engineering teams.

Equipment manufacturing is very decentralized, and equipment providers also set up branches in different countries and regional markets around the world. For example, ITT has branches throughout Europe and Latin America, providing related equipment for the corresponding market.

In the 1980s, with the introduction of digital technology, equipment manufacturers began to expand product lines and integrate some specific market needs into a single, global standard. The timely introduction of products becomes increasingly important, as some equipment providers have established leadership positions in related markets, such as Nortel at that time has gradually established a technological leadership in the digital switching market. The production of equipment has become centralized, and equipment manufacturers have tried everything to increase production and reduce costs.

The 1980s was an era when the government monopolized the operating market (except for the US market, where deregulation by the government there has begun. And the governments behind them did their utmost to win orders, because this is national honor, and it is the need for economic development and employment.

In the 1990s, various advanced technologies were not only in the hands of the largest equipment providers. Technological progress would have been as explosive. The introduction of IP technology, the Internet, the privatization of distant businesses, and the introduction of competition have revolutionized the entire telecommunications industry.

Under such circumstances, the strategy of equipment manufacturers has changed. They changed all the original R & D products of Cambodia and started to assume the role of system integrator to provide end-to-end solutions for operators. They use third-party products and equipment to build a broader product line through OEM and partner methods. The core of the return strategy is to test the first-party products to ensure compatible parts between different manufacturers' products. This change in business model has also led to a change in the role of some global equipment suppliers, who have shifted from managing products to managing customer relationships.

As everyone knows, in the early 21st century, the terrible things like the burst of the Internet bubble and the cold winter of telecommunications happened. At that time, many Xiaogong had been struggling to avoid bankruptcy or hope to be bought by VC (venture investment). However, this dilemma has not hindered technological progress. On the contrary, with the recovery of telecommunications, operators have found that their technology options are more extensive. ^[2]

Facing the rapid changes in the market, telecommunications equipment manufacturers are facing huge challenges. First, the division of value has made operators' returns far better than equipment providers.

In order to get rid of their own predicament and the increasing demand of operators, what do traditional telecommunications equipment providers need to become? The answer is a high-level system integrator. Although the standardization trend of the entire industry is increasing (such as ATCA, IMS, etc.), some operators, such as BT and China Telecom, still require personalized products and services. But this personalized product and service is different from the past in that it requires more added value and lower prices. In the future, the competitive advantage of equipment providers will be more obtained from logistics systems and rapid response to new services.

Traditional operators need more help in the evolution to the next generation network, because this is a project that takes more than 10 years. Network transformation, fixed-mobile convergence, deregulation and fierce competition are all challenges that operators have to deal with. It is imperative to develop the right strategy involving technology, regulation and market needs. Operators need a trusted system integrator more than ever, and global system integrators are eager to play this role.

Operators habitually categorize their contracts and system integration projects according to core backbone networks, metro and local access networks, transmission, call control and intelligent networks, or according to specific services. This practice of dividing by convention is also very common. For example, in the list of BT finalists, Cisco and Lucent were selected for the core network; Metropolitan Area Networks were used for Alcatel, Cisco, and Siemens; Fujitsu and Huawei were used for the access network; Ciena and Huawei Huawei is responsible for optical transmission.

It is not difficult to see that the finalists of these manufacturers are mainly due to the competitiveness of their core products. However, price has gradually become an important factor. As a fast-growing Asian telecommunications equipment supplier, Huawei is taking advantage of its cost advantages in labor and manufacturing, and has achieved a certain competitive advantage in terms of price. Some operators, such as BT and China Telecom, have also begun to leverage their purchases and demand more favorable prices. In fact, only those large equipment manufacturers are able to meet this comprehensive price and performance requirement, which has motivated equipment manufacturers with unobvious overall advantages to look for other markets.

In addition to price and sex, the traditional operators will also put forward additional requirements. These requirements range from customized product development, various access tests, technical support, and even additional billing and special payment cycles. For some small equipment manufacturers, this requires a lot of trouble. However, for those big equipment vendors, these are just the bargaining chips for their business dealings with operators.

It is worth mentioning that the reason for the shortlisting is not mentioned because these equipment vendors have the best products in the world. In fact, in each product area, we may find some relatively small competitors who can provide innovative designs and better performance products. However, operators are still accustomed to thinking that these latecomers are at risk of bankruptcy in the short term, and are therefore more willing to choose companies with strong capabilities.

Previously, those global equipment vendors ruled the entire telecommunications market because there were only a few of them at the time, and they still won orders frequently because of their advantages in terms of price, contract flexibility and stability. However, in the next 10 "'-20 years, if they still want to continue this lead, then they will have to find more competitive advantages ^[2]

Facing the huge challenges of the above markets, traditional telecommunications equipment providers are constantly adjusting their structures, integrating product lines, developing new services required by new markets, and developing new business models suitable for operators to explore the market in order to achieve the same operations as the final market. Together, they are dissolved in the growth of the new telecommunications market, avoiding being abandoned by competitors and surpassed by latecomers.

Globalization is no longer a new word for the telecommunications industry. The use of cheaper overseas labor to complete some internal functions of the enterprise, such as software development, operation of call centers, and manufacturing, has become a popular and standard practice, whether it is large enterprises or small enterprises. Many companies also outsource their manufacturing to take full advantage of standardized hardware and software platforms to reduce costs. The development of system software, industry standards, business software, and global supply chains has transformed the telecommunications industry from the exclusiveness of original products to multi-vendor collaboration.

So what are the characteristics of these new and successful global telecommunications equipment suppliers?

1. Global scale: Organization size, shipments, market share and revenue play a significant role in the global market. It can cope with fierce competition in all telecommunication market segments, and only the most competent can survive successfully. In addition, in addition to having a global brand image, it also needs to have a strong localization force.

2. Core product competitiveness: Having a leading position in one or more product areas is a necessary condition for it to reach global scale and become a potential system integrator for operators. Highly centralized and smooth product competitiveness will facilitate brand building and increase efficiency.

3. Low-cost operation: Outsourcing, utilization of cheap overseas labor, global supply, and 7 × 24-hour uninterrupted software development are necessary measures for equipment vendors to cope with future price competition and meet the time to market requirements. The price of the product and the efficiency of the development are as important as the characteristics and performance of the product itself, because only in this way can it form a comprehensive competitive advantage.

4. Professional services: Many operators are gradually reducing their network support teams, which makes it possible for equipment vendors to sell more specialized services. Because they have the technical experience, localization team, and installation experience for large projects, it is very beneficial for them to win a professional service contract as an equipment provider for an operator.

5. Product integration: The role of system integrators places global equipment vendors in a critical position to ensure interoperability between products from different vendors. This is particularly important for network intelligence product providers.

6. Network operation management: Although traditional operators are positioned as network operators, some operators have outsourced network operation and maintenance. In the past, the network operation and maintenance department was the largest and most important organization of the operator, but more and more operators regarded the network operation and maintenance as a consumption center. After the operator outsources this part, operation and maintenance is just a fixed overhead for them, and they can focus on improving their business income.

Over the years, global equipment suppliers have been transforming from being self-sufficient to becoming a system integrator that integrates multi-vendor products and provides end-to-end solutions. The globalization of the economy has forced these equipment vendors to reposition themselves. At this stage, the focus of their transformation is on scale, reducing prices, integrating global operating resources, and finding higher efficiency. Adapting to the new telecommunications industry and adopting the most suitable approach is the key to its survival and growth ^[2] .