Telecom operators and energy services: a delayed success story

For nearly 10 years, the spectre of a clash between Telecom Operators and Utilities flat on the energy market. Today, it is clear that we are still waiting for it.

In front of the changes, even the ruptures, which the energy market faces, the Telecom Operators immediately appeared as threatening actors; perhaps because they had the experience of adapting to changes in their own market.

As such, these players seemed to hold the key skills or experience: namely to reinvent a business model, to be more customer-oriented services, to know how to differentiate themselves in a competitive market, to know how to survive to a drastic fall in prices; many subjects on which utilities does not seem able to distinguish.

With these skills, the Telecom Operators have adopted multiple strategies, sometimes with a touch of arrogance: develop their own energy services, invest in start-ups of energy services or develop energy boxes.

It now seems that we are still awaiting results from them: are their advantages, yet obvious, really sufficient?

Several factors could explain this situation:

– The attractiveness of energy services in the residential market is not as important or natural as entertainment or communication services. The obvious economic benefits are not sufficient to engage consumers.

– Engage consumers in saving energy requires to follow a complex process that telecom operators do not seem to master.

– The Telecom Operators face, in all countries, the very positive image that utilities have from their customers which makes customers capture more difficult.

– Interactions between operating constraints of energy systems and services to residential customers are important. These interactions give a clear advantage to the Utilities and prevent Telecom Operators to maximize the benefits offered to customers.

I’m not sure to provide you with an exhaustive list of reasons.

But the above points show that if Telecom Operators still have mountains to climb before being legitimate and efficient in energy, it is the same for Utilities.

Telecom Operators and Utilities are still on the same line, near the starting line. The question is now whether the winning strategy for these players is to try to take over the other or is finding the best possible combination to finally create energy services activities that are neither embryonic nor in deficit.