RCA 2011: TMNG suggests differentiation key play for rural carriers

LAS VEGAS – Rural operators face many challenges in trying to maintain their business models on a day-to-day basis, challenges made more difficult by the increasing competitiveness of the mobile industry. Many try to handle the pressure on their own, while others seek out the advice and tutelage of established companies focused on providing insight into the mobile space.
One of those established companies is TMNG Global, which provides consulting and professional services to companies across the communications, digital media, technology and financial services markets.
Greg Hull, VP at TMNG, stopped by the RCR Wireless Newsdesk at this year’s Rural Cellular Association event in Las Vegas to provide some insight into how rural operators need to view their position in the space and what they can do to enhance their attractiveness to consumers.
Hull noted that one of the most important things rural carriers need to realize is that they are not going to be able to go head-to-head with larger rivals, and must instead find a niche that resonates with customers.
“Doing the same thing over and over again will not produce different results,” Hull explained, adding that rural carriers need to focus on positioning their operations to differentiate themselves from its rivals while at the same time trying to operate on a limited financial budget.
“They are more constrained then the larger competitors because of cash flow,” Hull explained. “They don’t see the economies of scale, their cost per subscriber is higher, their lifetime value that they receive from a subscriber is less, so they need to be effective and they need to be efficient.”
Rural operators often cite the ability to offer more localized services to customers as an advantage over larger carriers, as well as a stronger local network.
Hull noted that one of the benefits of working through the Rural Cellular Association for these operators is that most of the carriers are not competitive with each other in their markets so they can share a lot of their secrets in how they are able to remain competitive in their respective markets.
“I think there is more of that that needs to be done, especially from a purchase power perspective that they need to be focused on,” Hull explained.
Many rural carriers do to an extent belong to such organizations like Associated Carrier Group that pools the collective size of rural operators to gain better pricing on equipment and services. A number of carriers noted the importance of these organizations as well as the need for greater support.
Hull also noted that while it’s important for rural carriers to offer expanded coverage to their customers through roaming agreements, they also need to focus on offering services that generate “on-net” revenues, or services that drive usage and revenue from the carrier’s own network.
“That way you are keeping your revenue instead of passing it along to someone else,” Hull said.