From telco to techco: Why telecoms must transform for a new era of communications and technology convergence

The telecoms industry is facing an existential moment. Core products and services have reached commodity status, limiting operators’ ability to raise prices. This is putting growth under pressure, with global telecom revenue expected to increase by just 1–2% in 2026¹. Meanwhile, capital intensity remains high, with many operators spending 15–20% of revenue on CAPEX. As telecoms operators fight these twin pressures, the rules of engagement are being rewritten by radical technological advances, changing customer expectations, and fierce competition. 

Without a fundamental shift, telcos risk being outpaced by digital-native rivals, losing relevance with customers, and missing out on emerging value pools in tech-enabled services. According to TM Forum, more than 50% of telcos have already reported a decline in net promoter score (NPS) due to poor digital experiences. Investors are watching too. In the past five years, an estimated $280bn in market capitalisation has been lost across top telcos due to slow progress. 

The shift to the techco model 

As traditional models come under increasing pressure, telecoms companies must evolve beyond their traditional role as connectivity providers. Many of the world’s leading telcos are already working to reposition themselves as techcos – customer-centric, digitally enabled innovators that operate more like high-performing tech companies. 

There are major upsides to making this evolution. By rethinking traditional business models in favour of broader platform services and partner ecosystems, telecoms can reignite value, reimagine customer relationships, and realise greater efficiencies.

Done right, the telco to techco transformation delivers significant benefits 

Sustained revenue growth	Greater efficiency & cost effectiveness	Improved customer experiences	Sharper agiligty & competiveness
Exploring new revenue streams such as digital services, cybersecurity, and data analytics.  Embracing ecosystem partnerships and collaborating across industries to unlock revenue opportunities.	Reducing OPEX through automation and AI. Increasing margin through automation and cost reduction. Shifting costs from keeping the legacy lights on to fuelling innovation.	Improving customer experience with digital journeys and intelligent service.    Continuously adapting to changing customer needs.   Increasing customer retention and share of wallet through deeper relationships.	Rapidly sensing and adapting to changing customer needs, markets, and technologies.  Moving to next-gen architectures to boost flexibility and scalability, and power innovative services.  Differentiating from commodity-like OTT players who monetise connectivity.

Three keys to successful transformation 

The journey from telco to techco represents a deep transformation that extends far beyond launching individual products or updating isolated business functions. It requires a fundamental rewiring of operations from top to bottom, revolutionising how telecoms companies create, deliver, and capture value in the digital age.  

We have identified six pillars that form the foundations of this evolution, spanning product strategy through to platform-enabled operations. In this article series, we focus on three of the most critical dimensions – product, proposition, and pricing optimisation, reimagined customer service, and end-to-end value stream optimisation. 

Power your change with a proven partner 

The shift from telco to techco represents one of the most significant transformations a business can make. You're not simply updating your operations, but fundamentally reimagining what kind of company you are. This journey requires a partner who understands both the destination and every step along the way, and who can work with your people to deliver organisation-wide change.

We are telco industry experts, bringing external perspective, experience and challenge from both telcos, but also other industries. We link the business change with the technology enablement/ platforms, with a laser focus on delivering outcomes (rather than Powerpoint). 

We specialise in supporting telecoms clients throughout their value chain transformation, driving tangible, outcome-focused improvements that endure long after implementation.  

Our approach is built on four key differentiators. We champion people-first transformation, recognising that whilst technology enables change, your people ultimately deliver it. Our deep telecommunications expertise spans the industry's most critical challenges. We focus on holistic change, not silver bullets just small increments, understanding that successful telco transformation requires a sophisticated combination of propositions working in harmony. Finally, we provide tailored solutions, working with every client to shape a bespoke strategy and framework designed for their unique circumstances and ambitions.  

Together, we help telcos embrace their transformation into techcos – agile, data-driven powerhouses with diversified revenue streams, lean operations, and customer experiences that truly differentiate them in an evolving marketplace. 

References 

1. IDC Expects Worldwide Telecom Services Market Growth to Slow Due to Uncertainty