Data and analytics company GlobalData predicted escalating difficulties for mobile operators in the small- and medium-sized business (SMB) market due to a convergence of issues including increased costs and interest rates.  

The research company stated intense competition, the long-term impact of a financial crisis in the late 2010s and the war in Ukraine are factors squeezing market opportunities for the immediate future.

GlobalData noted the SMB sector benefitted from various types of government support during the Covid-19 (coronavirus) pandemic, but explained a substantial rise in interest rates coupled with “increases in basic costs of fuel and energy have driven costs up and negatively impacted consumer demand”.

It added the pandemic opened fresh opportunities for operators in the SMB sector as it spurred the creation of new enterprises, but noted these are contracting as the war in Ukraine resulted in rising costs and interest rates.

GlobalData explained those factors mean small businesses are forced to cut corners.

Robert Pritchard, principal analyst in Enterprise Technology and Services, said SMBs are a “natural target” for service providers, accounting for 90 per cent of all businesses and more than 50 per cent of global employment.

With the increasing reliance on communications services, he said most operators have intensified their efforts to win SMB custom as part of revenue growth efforts.

Pritchard asserted operators must determine “who their target customers are, understand their needs and articulate what their unique selling points” are.

“At the same time, they need to optimise operations to make use of digital transformation opportunities such as automation, AI, process and people rationalisation, and exploitation of digital channels.”

“There is still a vast SMB opportunity that will continue to drive growth in future, but there will be bumps in the road ahead.”