Growth Opportunity Trends to Watch for Telcos in LATAM

The global telecommunications market is experiencing moderate revenue expansion, and projections indicate a significant long-term growth trajectory. This silver lining of growth is expected to come from new revenue streams as the core business of consumer mobile services stagnates. 

What are these growth opportunities? How should a telco prioritise them? And what can you expect when launching these initiatives?

To shed light on the growth opportunities from new lines of business, we're delighted to interview Abel Herrera, Optiva VP of LATAM, who has over 25 years of experience in the LATAM telecom BSS market. Abel brings a wealth of experience in helping telecom operators navigate the complexities of the digital era and unlock new avenues for growth.

Question # 1:

The lines between telecom, technology, and other sectors are blurring with the advent of cloud, 5G, and generative AI (GenAI). What opportunities can telecoms, especially in the LATAM region, pursue? And how can they ensure they not only venture into these opportunities but also dominate their niche?

Answer: 

Telcos' bread and butter, the B2C mobile segment, is stagnating globally. Telcos need to think outside the box and innovate to develop new revenue streams for the future. This will require a startup-like mindset, where innovation and speed to product-market fit can help growth in new and emerging fields.

We see global growth trends in GenAI, niche MVNO opportunities, API monetisation, and BSS digitisation. These services can be extensions of telcos' existing core services and strengths.  

The rise in AI introduces many new opportunities for telcos. For example, according to McKinsey, 2,600 new data centers are expected from hyperscalers, reaching 11,000 data centers globally. The data centers will need to be connected via fiber to scale AI workloads, and operators will be the best suited to deliver and seize these opportunities. We see traction in the market with this taking place, for example, with Verizon's agreement with Google Cloud and Meta to provide network infrastructure for their AI workloads.  

Additionally, the adoption of GenAI is showing tremendous potential to cut costs, automate processes, improve customer experience, and help accelerate innovation.

5G API monetisation is another excellent opportunity for telcos. Exposing 5G through an API platform where its consumption and monetisation can be standardised, ushering in the next wave of 5G innovation. It will enable use cases like 5G gaming, smart cars, and more to merge into the mainstream.

Question # 2:

Looking at the diverse landscape of 5G adoption across Latin America — from early deployments to areas still planning rollouts — what are the top BSS strategies you see as absolutely critical for operators right now to unlock new revenue streams? 

Answer: 

I want to mention a couple of statistics highlighting BSS's critical role in telecom growth.

• BSS total cost of ownership (TCO) is 1-2% of the total revenue

• 100% of telco monetisation occurs through a BSS system

5G is the bedrock of the next wave of innovation in the telecom industry. However, telcos must evolve to become techcos through their processes, technologies, and company culture. Adopting new technologies will require a lean and agile business model that can evolve with time and needs. 

BSS will play a critical role in creating this ecosystem for future innovation. The two functionalities or adaptations that will be critical are:

1. Cloud-native 5G digital BSS is a necessity. Future BSS will need to scale for multi-services and have the ability to evolve rapidly (update and upgrade). This scale and flexibility are impossible without a cloud-native architecture. The system must also be cloud-agnostic to benefit from private and public clouds.

2. Extendable BSS. Products and partners that can provide extendable BSS functionalities are a must. Future-ready telco BSS will need to monetise multiple business opportunities and offer the best customer experience with simplicity. This can be achieved with one end-to-end product or well-integrated products that deliver the result at a low TCO and human resources. Too many BSSs with multiple system integrators (SIs) will complicate the ecosystem and make it too heavy to innovate quickly. 

The above strategies will ensure that future innovations can happen at speed and that BSS functionalities can evolve simultaneously.

Question # 3:

Customer experience is paramount for growth, especially in competitive LATAM markets with significant prepaid segments. How can modern BSS platforms, incorporating AI and advanced analytics, move beyond basic CRM to enable true hyper-personalization and proactive engagement, effectively reducing churn and increasing average revenue per user (ARPU) within prepaid and postpaid bases?

Answer: 

AI is a disruptor. No doubt about that. The companies that can ride on this AI wave and innovate will survive, and the rest will be forced to follow suit or will vanish.

In telecom, I see the use of AI, especially GenAI, in customer experience (CX). Recent advancements in general large language models (LLMs), combined with existing chatbot technology and the rise of agentic AI, are leading to new distribution models for telecoms and helping to provide superior customer experience at lower TCO.

For example, an AI customer service agent can handle 80-90% of repetitive customer queries. When embedded in a self-care app or portal, it can drastically reduces the overall customer service cost and enhance customer experience with faster resolution times.

A McKinsey study says that AI-driven CX intelligence can help identify customers who are up to five times more likely to churn in response to poor network experience; it can help generate a 10-15% increase in sales conversion and more. 

At Optiva, we have taken multiple steps to use GenAI capabilities to enhance customer experience. Using agentic AI, we have developed a framework of intelligent, specialised agents integrated with our BSS. These capabilities go beyond superficial chatbot layers and are deeply embedded into the operational fabric of telecom processes. We use AI, machine learning (ML), natural language processing (NLP), predictive analytics, recommendation engines, sentiment analysis, and conversational AI.

We have developed a suite of domain-specific agents designed to enhance a core pillar of telecom operations that includes:

• Amica (Customer Care) conversational AI that understands sentiments

  
  

• Kairos (Operations) embedded predictive analytics and ML algorithms

  
  

• Sophos (Sales) conversational AI, sentiment analysis, and recommendation engines

  
  

• Meraki (Product Configuration) NLP and analytics

  
  

• Echo (CSR Enablement) NLP with multilingual support

Question # 4:

The enterprise and wholesale sector represents a significant growth opportunity beyond consumer mobile. Can you talk about his opportunity in the LATAM market?  

Answer:

The enterprise and wholesale sectors show growth opportunities globally, and this is true in the LATAM region too. I see multiple efforts by telecoms in the B2B and wholesale segment — private 5G, B2G, enterprise network and communication services, and MVNE. Optiva MVNO Hubs for MVNO/Es is expected to do well in the LATAM market. We have already seen the rise of new MVNOs in 5G leading markets, and MNOs are also promoting MVNE platforms to utilize the underutilized 5G network. 

These MVNOs are generally new-age propositions with 5G as their core offering. We expect more AI-driven, fully automated, and end-to-end digital MVNOs and brands to mushroom in the next few years. They can provide good wholesale income for MNOs and help expand the 5G ecosystem.

Private 5G is another opportunity in the enterprise sector. We see a rise in demand for private 5G networks by large organizations, governments, and military establishments. 

Fixed wireless access (FWA) is also expected to do well in this region, as many areas in difficult terrains can benefit from FWA's high-speed internet. Rise in the digital economy, work from home, and FWA technology can provide the much-needed catalyst to this underserved opportunity.

Strategic and pragmatic approach to achieve growth 

We thank Abel for joining us for this interview. Our conversation clearly identifies the LATAM telecom market as showing potential for growth in several areas, including AI, cloud adoption, B2B, and wholesale segments. Adopting new technologies combined with 5G will usher in a new phase of growth and prosperity for the region. However, telcos need to be strategic and pragmatic in their approach. Getting the fundamentals right and collaborating with BSS partners who will help them successfully make the journey.

Want to know more about Optiva’s 5G-ready proven BSS that powers brands globally? Request a presentation.

By

Chinmay Mishra,

Marketing

Optiva