Telecom Analytics Market

Market Overview

The global telecom analytics market size was valued at USD 4.17 billion in 2022. It is projected to reach USD 13.76 billion by 2031, growing at a CAGR of 14.2% during the forecast period (2023–2031). One of the primary factors that is driving the expansion of the telecom analytics market is the requirement to streamline business activities that have an effect on revenue.

The telecom analytics solution's predictive and prescriptive modeling techniques enable telecommunication clients to achieve a high return on investment (Rol) and lower total cost of ownership (TCO).The telecommunications sector constantly faces numerous challenges, including churn prediction, social network analytics, and customer engagement. Businesses can get business intelligence (BI) from the telecom analytics solution to meet their complex needs. The demand for telecom analytics is driven by increased attacks and suspicious activity, a growing need for efficient revenue management, and a rise in churn prevention. The solution offers invaluable insights for business operations, revenue recognition, and customer management to gain competitive advantages. 

Real-time data analytics is made possible by cutting-edge technologies like artificial intelligence and machine learning. Al-driven telecom analytics provides insightful data that aids in outcome prediction. As a result, industrywide adoption of Al-driven telecom analytical solutions is increasing. The ability of Al analytical platforms to lower risks and fully automate the analysis process will probably support the expansion of the telecom analytics market. The widespread adoption of content security policy (CSP) by the telecommunications sector promotes market expansion.

Market Dynamics

Market Drivers

Increased Demand for Reduction of Churn

The percentage of subscribers switching service providers within a predetermined period is known as churn in the telecom industry. Businesses are working harder and harder to reduce churn because if the percentage rises year after year, it hurts the company's reputation. This severely impacts future sales and business for the company. By using telecom analytics, churn can be reduced by 15% on average. Telecom service providers ask for the customer churn analytics tool to stop revenue losses, improve customer service, and cut down on marketing and sales costs. By implementing telecom analytics solutions, carriers can use subscriber usage data to understand subscriber behavior patterns and improve customer experiences. It allows telecom companies to cross-sell and up-sell. Vendors in the market are providing telecom analytics solutions infused with machine learning to understand sentiments, enabling carriers to identify at-risk subscribers or the causes of current and future churn.

Demand To Improve Corporate Operations

The telecom analytics sector's growth is also driven by the need to optimize business operations that affect revenue. The number of customers, the sale of value-added services, billing rates, and other factors largely determine the revenue of telecom companies. In addition to objective Key Performance Indicators (KPIs) measures, telecom analytics systems may provide qualitative and quantitative metrics to various applications for business, network, or consumer use cases. Using relevant data, such as subscriber experiences (xDRs), region, associates (TAP), network (probes), and activities, to calculate propensity scores could help in tracking crucial subscriber decisions that have an impact on revenues. These characteristics make the market likely to grow during the forecast period.

Market Restraints

Lack of Awareness and Increasing Fraud

Its usability may be restricted by missing values, the absence of sections, a significant portion of the data, or incomplete data. Additionally, it occasionally violates privacy principles and can be used to manipulate data. It is anticipated that a lack of knowledge about telecom analytics solutions will limit market expansion. Contrarily, it is anticipated that the increased use of new technologies in telecom analytics, such as artificial intelligence (AI) and machine learning, will present lucrative opportunities for market growth. The telecom industry is dealing with several frauds due to the rising adoption of mobile devices and the rising use of IP addresses. Because attacks can happen from any source at any time and because fraud is on the rise, the telecom market is experiencing trouble, which reduces demand for telecom analytics.

Market Opportunities

The Need to Streamline Revenue Management, Is Growing

The growth of the telecom analytics market is primarily driven by the need to streamline business operations that impact revenue. The number of subscribers, sales of value-added services, billing fees, and other factors heavily influence how much money telecom companies make. The limitations that need to be improved to boost telecom companies’ revenue can be identified using telecom analytics. Making the right business decisions and reducing risk are made possible by telecom analytics software. Additionally, it helps businesses differentiate themselves from the competition and deliver subscriber-focused scores to support revenue growth. For a wide range of applications for business, network, or customer use cases, telecom analytics solutions can offer qualitative and quantitative metrics that offer objective Key Performance Indicators or Key Quality Indicators measurements. As a result of these features, the market is anticipated to expand during the forecast period.

Regional Analysis

The global telecom analytics market is bifurcated into four regions: North America, Europe, Asia-Pacific, and LAMEA.

North America is the most significant shareholder in the global telecom analytics market and is expected to grow at a CAGR of 13.6% during the forecast period. The U.S. and Canada are included in the analysis of the telecom analytics market in North America. A result of technological development and an established industrial infrastructure. Another factor anticipated to fuel market growth in the upcoming years is the quickening development of digital marketing, such as e-commerce and social media marketing. Another element influencing regional growth is the presence of some of the most well-known companies in the sector, like IBM Corporation and Oracle Corporation. Massive amounts of data are produced due to the telecom industry's widespread distribution, which helps the local market grow. The telecommunication industry's rising demand for data analytics is primarily to blame for the market expansion. North American telecom services are in high demand due to the steadily increasing internet data traffic across the United States.

Europe is expected to grow at a CAGR of 14.7% during the forecast period. The UK, Germany, France, Italy, Spain, and the rest of Europe are all included in Europe's telecom analytics market analysis. Due to increasing investments in providing better service quality for increased consumption, Europe is a significant global market for telecom analytics. Adopting several technologies, including cloud services and the Internet of Things (IoT), further accelerates market growth in the area. The widespread use of cloud and data analytics is anticipated to drive the market's expansion during the forecast period. Additionally, the market growth across Europe is anticipated to be driven by the leading European telcos' adoption of analytical techniques to manage procurement activities in large-scale purchasing processes. For instance, in Europe, IBM and Deutsche Telekom collaborate to create smarter cities.

Segmental Analysis

The global telecom analytics market is segmented by deployment, application, and end user.

Based on deployment, the global market is bifurcated into on-premise and cloud.

The cloud segment is the highest contributor to the market and is expected to grow at a CAGR of 14.3% during the forecast period. This market’s growth is driven by the cloud deployment model's low investment cost, scalability, and agility. Telecom cloud solutions enable operators to lower operational and administrative costs while providing simple solutions. Furthermore, it is anticipated that small businesses will increasingly adopt cloud technology and experience growing mobility needs, creating lucrative growth opportunities shortly. This is due to several benefits of cloud-based telecom analytics solutions, including direct IT control, internal data delivery and handling, quicker data processing, efficient resource utilization, and cost-effectiveness.

Based on application, the global market is bifurcated into network analytics, customer analytics, market analytics, price analytics, and service analytics.

The customer analytics segment is the highest contributor to the market and is expected to grow at a CAGR of 13.9% during the forecast period. The constant rise in customer churn is primarily to blame for this high share. Telecom companies are spending more on customer care and retention. However, the cost perception of providing customers with solutions and services has remained the same, which has resulted in flat revenues. Despite the industry's successful implementation of a customer-first management strategy, customer needs are rapidly shifting. Operators are making significant technological advancements to keep up to decrease customer churn.

Based on end users, the global market is bifurcated into IT & telecom, BFSI, manufacturing, energy & power, healthcare, and others.

The IT & telecom segment is the highest contributor to the market and is expected to grow at a CAGR of 14.5% during the forecast period. These solutions also allow carriers to understand subscriber behavior patterns, gain insights from subscriber usage data, and facilitate cross-selling and up-selling opportunities. As a result, telecom companies worldwide rely more on telecom analytics solutions. Leading players also utilize technologies like big data, data science, and the Internet of Things (IoT), which offer cost-efficiency, customer understanding, and revenue maximization, creating a positive market outlook. The market is driven by several important factors, such as rising network attacks, threats to online data security, and significant IT infrastructure improvements.

Recent Developments

• November 2022, The $2 billion telecom agreement will allow the IT service provider to compete with network equipment manufacturers like Nokia, Ericsson, and Samsung by making its telecom offerings available to potential clients worldwide.
• April 2022, Express Analytics, a business intelligence firm with headquarters in California, claimed to provide telecom companies with tailored solutions to reduce customer attrition and increase average revenue per user through the use of processes supported by artificial intelligence (AI) and predictive modeling.