Care Ratings: Cut in telecom revenue target to impact fiscal deficit estimate in 2017-18

The fiscal deficit estimate for the year 2017-18 is Rs 5, 46,532 crore and if the shortfall is taken into account, the deficit estimate for the year will stand increased to Rs 5, 64, 312 crore, the agency added.ETTelecom  |  June 20, 2017, 18:21 IST

Newsletter A A

NEW DELHI: The government’s fiscal deficit estimate for 2017-18 is set to rise to 3.35% from present 3.24% of the GDP, impacted by the shortfall in non-tax revenue target by Rs 17,780 crore from telecom services, ratings agency Care Ratings said Tuesday.

Given the severe pressure on account of intense competition, fall in sales and profits, increase in debt and hugely priced spectrum acquisition, the agency has put the focus on the decision that of the inter-ministerial group – looking into the financial stress of the telecom sector – which it said will be of ‘utmost importance.’

“If the telecom industry falls short of the non-tax revenue target by Rs.17, 780 crore, then the fiscal deficit estimate for India for the year 2017-18 will stand increased to 3.35% from the estimate of 3.24%,” the agency said in a note to clients.

The fiscal deficit estimate for the year 2017-18 is Rs 5, 46,532 crore and if the shortfall is taken into account, the deficit estimate for the year will stand increased to Rs 5, 64, 312 crore, the agency added.

The agency’s views come a day after ET reported that the telecom department (DoT) asked the finance ministry to cut the non-tax revenue target from telecom services by over 37% to Rs 29, 524 crore for the current financial year, on account of financial stress in the sector caused by intense competition and debts that the banking sector considers to be around Rs 7.29 lakh crore.

“Witnessing the current trend of falling revenues that impacted the collections of license fee and spectrum usage charges, the telecom ministry is of the view that this trend will continue in the near term as well,” Care Ratings said in the note.

The department expects license fee estimates for this fiscal to plunge by nearly half to Rs 9,255 crore and spectrum usage charge (SUC) to be lower by more than 35% to Rs 17,056 crore. It also expects zero revenue from spectrum sale even if there is an auction this fiscal, as service providers may not bid for airwaves given their highly leveraged balance sheets, member finance at DoT said in a letter to the department of economic affairs dated June 1.

Gross revenue of the sector fell by Rs 26,000 crore, or 11% on year, in the last fiscal ended March 31 to Rs 2.1 lakh crore. “In view of the severe financial stress in the sector and rapidly declining revenues of all major telecom service providers, revenue targets for DoT for budget estimates 2017-18 will actually require a downward revision,” Anuradha Mitra said in the letter.

As per the current norms, the telecom companies pay 8% of the adjusted gross revenues as license fee and 3-6% of the adjusted gross revenues as spectrum usage charges. However, of late the industry has been asking the government to reduce these charges as the industry is facing severe competition and is under financial pressure.

Care Ratings pointed to the tariff war started by Reliance Jio giving free voice and data offers, which lead to revenue decline of 1.1% in December 2016 quarter and further decline of 10.2% in the March 2017 quarter.

“It was not just the revenues but also the profit margins that were hit on a y-o-y basis in the December 2016 quarter and the March 2017 quarter due to predatory pricing. The operating margin contracted in each of these quarters and the net margin also saw deterioration during these quarters,” the agency said.

The quarterly operating margin dropped to 27.8% in the March 2017 quarter, 0.6 percentage points on-quarter, while net margin dropped to -64.5% from 0.3%, in the same period. The average sales growth rate and net profit margin of the industry remained weak in 2016-17 due to ‘new entrant that forced the incumbent telecom companies to cut their rates for data and other services,’ Care Ratings added.

The telecom operators as well as banks met the IMG over last week to assess stress in the telecom industry and are seeking support from the government for its betterment. Carriers have asked for government support by cutting licence fees, SUC, scrapping the Universal Service Obligation Fund (USOF) and deferring payments for spectrum over 20 years, among others.

Some banks have already raised concerns of loan defaults while the industry itself has been pushed into consolidation mode. Vodafone India and Idea Cellular are merging as are Reliance Communications, MTS and Aircel to better fight

Traditionally, the telecom industry hadn't been great fodder

Traditionally, the telecom industry hadn't been great fodder for water cooler conversations. It has long been thought of as a boring, dividend-paying sector.

About the Author

Bryan Borzykowski is a Toronto-based business and investments writer. He’s contributed to the New York Times, CNBC, BBC Capital, CNNMoney and several other publications. Bryan’s also written three personal finance books and appears regularly on CTV News.

Contact Author | Meet other investing specialists

That's changing. Over the last few years, the industry has been undergoing a transformation, with telecom companies foraying into content distribution, upstart wireless firms grabbing market share, increasing digital data usage, and more. "There are more headlines about telecom today than there were three years ago," says Alex Zhao, an equity analyst with Morningstar. It's certainly a more exciting--and a more uncertain--sector than it has been for a while. And uncertainty around the sector's prospects have driven down the S&P 500 Telecommunications Services subindex 6.7% since January. Many of the more traditional players in the sector have seen declines: AT&T has fallen 3.5% year-to-date, while Verizon is down nearly 10% since the beginning of the year as of this writing. Other parts of the telecom market have climbed, though. Cable company Charter Communications, for instance, is up 13% year to date. That divergence in returns among companies is emblematic of the difference between today's telecom sector and the telecom sector of old. What's Happened with Wireless?
When most investors think of telecom, they likely think of the big-name wireless companies, such as AT&T (T), Verizon Communications (VZ), Sprint (S), and  T-Mobile US (TMUS). There's plenty of change afoot here. Years ago, AT&T and Verizon dominated the sector, and while they're still the largest players, their once-large moats have diminished as T-Mobile and Sprint have started taking market share. (Morningstar currently assigns a narrow moat rating to the former two companies and a no moat rating to the latter two.) That has impacted their pricing power, says Zhao. T-Mobile, for example, has introduced an unlimited data package, something the bigger carriers haven't wanted, but are now forced to do. It's also unclear how the content play that some wireless firms have been ­engaging in will work out. If AT&T's purchase of Time Warner (TWX) goes through, it will own a lot of high-quality programming, such as HBO's lineup, which could allow it to generate advertising revenues and reduce the price it pays to show content on its various platforms. It may also give subscribers content-specific benefits, similar to how AT&T provides customers free data streaming for DirectTV Now. (AT&T purchased the satellite business in 2014.) However, Zhao doesn't think the bundling model will give these companies a sustainable edge, because competitors can also start offering content for free. For instance, T-Mobile gives customers who switch from AT&T a year's free credit for a DirectTV Now subscription. The cellphone market is also fairly saturated. According to research site Statista, the number of U.S. wireless subscribers grew by just 5.4% year-over-year in the fourth quarter of 2016. Increasing competition, weaker pricing and slow growth doesn't say screaming buy, at least not in the near term, says Paul Greene, manager of the Bronze-rated T. Rowe Price Media & Telecommunications (PRMTX). "The competitive environment in the U.S. wireless industry has gotten worse for the large incumbents," he says, though he does note that he has a sizable portion in T-Mobile, which is growing faster than the others. Saying all that, buy and hold dividend investors may still be drawn to these companies, says Greene. They offer good payouts--AT&T has a trailing 12-month yield of 4.8%, while Verizon is yielding 4.85%. Like other dividend payers, these stocks may underperform in a rising rate environment--but the dividend is still attractive nonetheless. Better Prospects in Cable and Towers
For investors who want more growth--and perhaps more upside--managers agree that there are two areas to look at within telecom: broadband cable and cellphone towers. The former, which includes companies such as Charter Communications and Comcast (CMCSA), has been taking market share from traditional wireline operators that transmit cable over a copper line. Broadband cable is delivered over the internet and is a much faster delivery system than wireline, says Scott Walker, an analyst with MFS Investment Management, who contributes telecom ideas to the Silver-rated MFS Utilities (MMUFX). "It's really winning that race consistently," he says. Broadband is also Netflix-proof. Since the internet is also delivered over broadband, even if someone cuts the cable cord, they'll need a fast and reliable connection to stream movies. "If you ditch your cable bundle, you still need some way to consume Netflix (NFLX)," says Walker. "So your faster speed alternative will be (broadband) and that reinforces the bet in the long-run." Both Walker and Greene are also fans of tower companies, which are physical towers that transmit wireless signals to cellphones. They charge carriers a fee for use of their towers, and that fee can increase as consumers consume more data. Companies in this subsector, such as SBA Communications (SBAC) and American Tower (AMT), typically raise prices by inflation or 3%, whichever is higher, says Walker. As people use more data--Americans are expected to increase their data consumption by 535% between now and 2021, according to a 2016 Ericsson Mobility report--­tower companies could start seeing double-digit revenue growth, says Walker. Greene thinks the sector will see strong internal rates of return, too. "We can see compound returns grow at double digit rates with a lot of visibility and without much variation," he says. Pick Your Spots--and Mind the Uncertainty
Currently, the telecom sector is just slightly undervalued according to Morningstar, trading at 0.96 fair valuation ratio. A few names are trading in 4-star range, suggesting they're undervalued by Morningstar's metrics: CenturyLink (CTL), Frontier Communications (FTR), and Windstream Holdings (WIN). However, investors in this sector should pay close attention to uncertainty ratings, which vary by company. Despite the pressure on the traditional telecoms, AT&T and Verizon both earn medium uncertainty ratings, because they're still large companies that generate plenty of cash, says Zhao. However, CenturyLink, Frontier Communications, and Windstream Holdings all carry high or very high uncertainty ratings due, in part, to increasing competition in the cable sector. While several Morningstar Medalist funds hold telecom stocks, Greene's T. Rowe Price fund is the only telecommunications fund that earns a medalist rating. Some other telecom-focused mutual funds and ETFs include Fidelity Select Telecommunications (FSTCX), iShares US Telecommunications (IYZ), S&P Telecom ETF (XTL), and Vanguard Telecommunication Services ETF (VOX). Bryan Borzykowski is a freelance columnist for Morningstar.com. The views expressed in this article do not necessarily reflect the views of Morningstar.com.

Landline charges for 2m customers to be cut as telecoms watchdog steps in

Ofcom has slammed telecom providers for offering landline-only customers poor value for money, as it unveiled plans to force BT, the dominant provider, to cut bills by at least £5 a month, benefiting about 2.3 million people.
The regulator has reviewed how the market is working for customers who buy only a landline service from a provider – either because they do not want broadband or pay TV, or because other companies provide these services.
Ofcom said the customers, who tend to be elderly people who have been with BT for decades, were getting “poor value for money”.
The watchdog aims to force BT to cut its standalone line rental by £5 to £7 a month which means customers with only a landline, who currently pay £18.99 a month, would pay no more than £13.99 – a reduction of at least 26%. The price cut would not apply to landline services sold by BT as part of a bundle of services including broadband.
BT accounts for nearly 80% of the landline-only market of 2.9 million people. At the start of the review in December, Ofcom said BT and Virgin Media had the highest line-rental charges, followed by TalkTalk and Sky. At the time, Virgin Media launched a “Talk Protected” plan which freezes line rental for elderly and disabled customers at £17.99.
Ofcom expects other providers who benchmark prices against BT to follow suit and cut landline rental charges. The regulator’s investigation closes in May. It will announce a final decision towards the end of the year.
Consumer groups and the Labour party welcomed Ofcom’s move. Tom Watson, shadow secretary of state for culture, media and sport, said: “This landline rip-off can’t go on any longer. It’s a scandal that service providers have increased landline prices year on year despite benefiting from significant decreases in wholesale costs.
“Landlines are important to households across the country, and the elderly and vulnerable in particular. We need to see a fairer deal for consumers and the government must act to put safeguards in place to prevent future increases above inflation.”
Citizens Advice called for similar action in other markets such as energy. Its chief executive, Gillian Guy, said: “Loyal customers often pay much more for their essential bills. People who stay with the same phone, broadband, gas and electricity supplier are getting a raw deal – as firms know they are less likely to shop around to get a better price.”

Telcos keen to utilise emerging tech – but it’s a struggle to get there

– but it’s a struggle to get there

By James Bourne 02 February 2017, 17:05 p.m. comment

Categories

IoT, Operators, OTT Services, Research

(c)iStock.com/TCmake_photo
It’s a theme which is as old as the hills. Can telcos, not traditionally renowned for their speed and flexibility, keep up with new and innovative technologies? According to a new piece of research from KPMG, the answer is: sort of.
The study, which polled 580 senior executives across 16 countries, found that for telcos who have been proactive in adopting new technologies, more than half (58%) have seen a positive impact on their business operations. Yet just over one in 10 (11%) believe their company has a ‘clear’ strategy to deal with new technologies. By contrast, four in five (79%) fear their firm will struggle to take advantage of areas such as over the top (OTT) services.
Despite the prevailing wind suggesting the cloud ship has sailed – the four leaders in cloud infrastructure continue to grow quicker than the rest of the market – cloud is the most common investment area, cited by 65% of respondents, followed by mobile (64%) marketing platforms (59%), and data and analytics (58%).
However more than half (54%) of respondents fear their organisations are only investing in proven technologies leaving them ‘behind the curve’ – and while that approach may work for companies such as Apple, for operators it’s a different matter altogether.
The report did find that enthusiasm was there for investing in more emerging areas, such as wearables and the Internet of Things (IoT), as well as improving the customer experience through new technologies. Yet according to Alex Holt, head of technology, media and telecoms at KPMG’s UK arm, more still needs to be done, particularly with billing information on millions of customers at telcos’ fingertips.
“Disruption is the new normal for telcos,” said Holt. “Businesses across the sector are accustomed to running large networks and customer service operations with significant staff numbers, and many are burdened with traditional ways of thinking and need to undergo a substantial cultural shift to embrace new disruptive technologies.
“To compete effectively, the telco of the future needs to be staffed with digital architects, data scientists and developers to remain agile and the industry has considerable work to do to reach that position,” Holt added.

Airtel, Vodafone and Idea Cellular gearing up for a tough 2017

fficiency, effectiveness and cost control will be the focus areas for telcos in the New Year, when the number of data users is likely to surge. Devina Sengupta&Niharika Banerjee  |  ET Bureau  |  Updated: January 02, 2017, 09:55 IST

Newsletter A A

inShare2 7

MUMBAI: India’s telecom industry won’t be raising a toast to 2017. Instead, it will be gearing up for a tough 12 months with Bharti Airtel, Vodafone India and Idea Cellular — the top three — embroiled in a war with newcomer Reliance Jio Infocomm.

Telcos are bracing for further pressure on both voice and data rates, and the resultant threat to revenue growth and narrowing margins and profit, amid increased finance costs due to burgeoning debt and spending on expanding 3G and 4G networks, analysts said. Efficiency, effectiveness and cost control will be the focus areas for telcos in the New Year, when the number of data users is likely to surge.

“The sector is staring at almost Rs 3 lakh crore of debt and the profit margins at a sector level would be wafer-thin. Servicing of such debt would be difficult with falling revenue,” said Prashant Singhal, global telecommunications leader at consultancy firm EY. He added that at current debt levels, the sector needs some stimulus from the government to fuel growth in networks and drive digital adoption. Singhal expects some semblance of normalcy to return only in 2018.

Debt has ballooned as telcos invested in expanding networks and purchasing spectrum. “Players must figure out ways to reduce their debt, which has partly been a result of poor usage of funds,” said BK Syngal of Dua Consulting. Incumbent telcos have been struggling with price wars since Jio started commercial services in September, offering free data and voice services, initially till the end of 2016 and then extending it till March 2017.

Vodafone Group Plc slashed the value of its Indian subsidiary by about Rs 36,450 crore in November due to increased competition sparked by Jio’s entry. The extension of Jio’s free data and voice service prompted rivals to introduce free voice bundled with data plans starting at Rs 145.

Data realisation by service providers will drop 20-25% this year, according to a report by PwC. Following the price war on mobile data in India, telcos will experience reduced data realisation this year as an increase in data traffic will not compensate for lower data revenue, PwC said. “2017 is expected to be a tough year since telcos have to find ways to increase their capex to make themselves more data ready,” said Arpita Pal Agrawal, partner - advisory services and leader of telecom sector for PwC.

Hemant Joshi, telecom lead analyst at consultancy firm Deloitte, expects pricing pressure to continue till a new paradigm on pricing is reached. “2017 will be the year of resetting the sector in terms of pricing, consumer experience, competition and relooking at dumb pipe versus smart pipe paradigm. Profitability and cash flows will continue to be under pressure till profitable data play picks up in a significant way with linkages with Internet of Things and solutions for other business,” Joshi said. Both incumbents and the new entrant will look to woo customers via the medium of better data in 2017, increasing the number of data users by 30-40% over 2016 amid the digital push by the government, the rollout of 4G services and a reduction in smartphone prices.

U.S. Telecom Industry: Momentum to Continue in 2017

The surprising victory of Republican Donald Trump in the presidential election is starting to impact telecom policy parameters. Trump will take charge of White House on Jan 20, 2017 and will select a new Chairperson of the U.S. telecom regulatory body, the Federal Communications Commission (FCC). The Trump regime is likely to bring some relief as well as concerns for the telecom industry.

Nevertheless, the U.S. telecommunications industry is likely to witness reasonable growth through 2017. This industry has lately emerged as an intensely contested space where success depends largely on technical superiority, the quality of services and scalability. Cut-throat pricing competition may put pressure on margins. Uninterrupted advancement in telecom technologies has helped telecom operators and equipment manufacturers adopt newer business models in order to boost revenues.

Wireless network strength holds the key to overall growth of this space. As wireless networks run on radio frequency, spectrums (airwaves) have logically become the most sought-after asset in the industry. Spectrum auctions conducted by the FCC from time to time will significantly boost network capacity.

Key Attributes for 2017

(1) The telecommunications industry is essentially characterized by high barriers to entry. The deployment of network infrastructure requires significant capital expenditure, which very few entities can afford. Furthermore, it is not easy for a new telecom carrier to establish itself in the market as it requires government approval to transmit voice, data and video. Such barriers protect the profits of incumbents.

(2) A major characteristic of the telecommunications industry is that it is immune to international geo-political disturbances, even when these lead to economic fluctuations. This is because the need to remain connected springs from our earliest instincts to communicate with fellow human beings. Volatility in the global economy due to political and economic disturbance in the Eurozone, Asia-Pacific or the Middle-East has had little impact on the sector.

(3) Wireless network strength is the key to future growth of the overall telecom industry. As wireless networks run on radio frequency, spectrums (airwaves) are naturally the most sought after assets in the industry. Spectrum auctions conducted by the FCC from time to time will significantly boost network capacity.

(4) Telecom companies offer one of the highest dividend yields in the U.S. economy. Unlike other industries, U.S. telecom operators generate their revenues predominantly in the country. This makes these stocks less susceptible to volatility in the foreign exchange rate as well as macro-economic fluctuations plaguing the rest of the world. We believe the strong dividend yield momentum will continue as the U.S. economy slowly returns to stability.

(5) Mergers and acquisitions (M&A) are not uncommon in the U.S. telecom industry. Telecom and pay-TV operators often join forces to provide better and attractive bundled products to their customers. In order to stay abreast of competition, existing players need to be constantly on their toes to introduce innovative products or merge with other companies. In the near future, the U.S. telecom industry is slated to witness further mergers and acquisitions along with product diversifications.

Major Upcoming Developments

Telecommunications is one of the few industries to have undergone rapid technological improvement even during the Great Recession. An era of digitization and technology has essentially been built on the basic requirement to remain connected. It is in this context that telecommunications comes to the fore as a necessary utility. Growing demand for technologically superior products is the silver lining in the telecom industry in an otherwise tough environment.

5G Wireless Technology

Several industry researchers hold that fifth-generation (5G) network will provide a download speed of 1 Gbps (gigabit per second), which is 200 times the throughput of the currently available standard 4G LTE network. Latency period of data delivery will be in single milliseconds. Further, 5G technology is designed to be more power-efficient than any other standard wireless network available at the moment. Naturally, 5G-enabled mobile devices are likely to last much longer than their 3G or 4G counterparts.

Ending the Digital Transformation Paradox

Telecoms.com periodically invites expert third parties to discuss the biggest challenges facing the telecoms industry today. In this post, Gary Messiana, CEO of Nominum, looks to demystify digital transformation and how DNS can help end the paradox.
In recent years, the incredible increase in demand for online connectivity, fueled by the mobile internet boom, has created an overwhelming challenge for communication service providers (CSPs), resulting in a market situation we call the “digital transformation paradox.” While the digital economy has flourished on the back of their networks, CSPs have been forced to keep pace by investing significant amounts of money in infrastructure. Such financial burdens have made it nearly impossible to commit innovation and development resources to creating higher-value digital services to thwart competition from over-the-top (OTT) players.
Herein lies the paradox: CSPs created the very infrastructure that enabled a thriving digital economy, but, through no fault of their own, have not reaped their fair share of the rewards. They are now turning the tide and moving up the digital transformation curve—a representation of the key steps to achieving digital transformation.
With the supporting infrastructure in place and capacity and cost efficiencies paying off, CSPs are ready to take part in the digital transformation imperative by gaining a holistic view of the subscriber and delivering personalized subscriber services. The number one challenge for CSPs in achieving this integrated customer view is to cost-effectively unify the multiple organizational functions needed to do so. Delivering these personalized services in a cost-effective, scalable and reliable way, while bound by legacy systems, is no easy task. Compounding the problem is the fact that the technology choices for uniting functional silos of people, systems and the functions they perform along this digital transformation curve are limited and prohibitively expensive. Many CSPs are looking to network virtualization to further reduce costs but this approach does not solve the fundamental issue of lack of cohesion between the network, security, customer service, sales and marketing teams that have been tasked with digital transformation imperatives.
Given this scenario, how can CSPs end the digital transformation paradox and become significant competitors to OTT brands that have been using their networks to entice subscribers away—and in some cases even building out their own faster and less costly networks?  It’s counter-intuitive but the answer is not investing in new, overly complex subscriber-facing applications from multiple providers. This exacerbates the problem with respect to delayed time-to-value, lack of employee cohesion and increased subscriber confusion. The fastest, most cost-effective way to successfully end the paradox is to look for greater simplicity by finding the lowest common denominator to unify the systems, functions and people CSPs need to deliver an exceptional and personalized subscriber experience. The answer is found in an asset that already exists in every single CSP network today. The answer is DNS—the fundamental building block of the internet.
DNS: The Central Nervous System of all IP Networks
Why is DNS an ideal technology to power the digital transformation shift? While often overlooked as simply being the “phone book” of the internet, DNS has moved beyond the realm of passive internet look-up functionality and is now at the heart of digital transformation. When DNS is leveraged as an active, intelligent resource, it both synchronizes business functions and efficiently delivers premium services that increase subscriber value. An elegant and robust technology, DNS has the ability to deliver innovative, personalized services from end-to-end across provider networks. And, because it already exists in CSP networks, DNS is easily leveraged without extensive cost or complexity.
While many existing suppliers to the CSP segment have recognized these challenges, the solutions they offer are naturally biased toward their position in the physical network. The higher up the stack, the more limited the breadth of their offers and the greater the potential for point solutions to operate in silos. This is exactly what CSPs must reverse to accelerate up the digital transformation curve. Conversely, the lower a supplier’s physical position in the network, the broader and more extensible their offerings can be—an essential concept to ending the paradox.
In our conversations with leading CSPs around the world, top-of-mind issues include overcoming escalating competitive pressures, enhancing subscribers’ ever-increasing digital lifestyles and growing revenue, all while delivering new services and up-selling existing offers. Progressive CSPs now recognize that in order to meet these objectives, they need to sync digital service capabilities with people, processes and systems across the entire business, not just at points along the digital transformation curve. This means bringing marketing, customer service, finance, legal and every other department that has a customer touchpoint along the curve together with the more traditional network and security teams. The days of keeping these groups physically and functionally separated are over. Given its position in the network, DNS plays the perfect role in unifying these teams with efficiency and cost-effectiveness, while supporting the digital lifestyle their subscribers demand.
Extensible DNS: A Platform for Digital, Value-Added Services
Since DNS connects IP addresses with application and service requests, it is now being leveraged across many CSP organisations to create greater subscriber value. It is used to secure the network, protect subscribers, create high-value, premium offers like parental controls, and enable interactive communications that reach 100% of subscribers in a timely and convenient manner.

Industry experts agree that digital transformation requires a more flexible, extensible IT architecture to speed time-to-market of new product and service innovations. A key aspect of this approach is utilizing existing IT systems and complementing them with lightweight, agile platforms that support simplified digital offers and experiences. When properly leveraged, DNS is a high-performance service enabler that meets CSP requirements for flexibility and scalability, while accelerating the delivery of subscriber-centric services that create new streams of revenue and grow market share.
Sue Rudd, director for Strategy Analytics, published a white paper titled “Accelerating Digital Transformation for Communication Service Providers.” In it, she describes four areas that are essential for digital transformation:

1. Service providers and subscribers gain real-time control over services. For example, families set filters that are activated instantly to match their content preferences.
2. Integrated IP service management provides simplified management of one platform with unified interfaces for monitoring and provisioning.
3. Converged solutions ensure subscribers receive the same experience regardless of the network or device they are currently using—whether LTE/cellular, Wi-Fi, cable, DSL or fiber; or smartphone, tablet, e-reader, laptop or PC.
4. Personalized user access empowers households to create their own unique ‘view’ of the internet and customize settings for every device in the home.

DNS is at the heart of all four of these areas. The CSPs that have put it to work are able to compete more effectively and bring new services to market much faster than their competitors, and will ultimately be in the best position to end the digital transformation paradox. As with many seemingly intractable challenges, simplicity is the right answer, although too often the last place we look.