In a new series by Worldpay from FIS®, we pick the brains of our payments experts. Here, Phil Hogg, President of Worldpay Canada, shares his thoughts on the changing telco landscape, and the challenges organizations that operate in this industry face.

Working in telecoms for over 15 years means I’ve seen plenty of world-leading innovations come and go. This includes my time at Bell Canada managing the IBM Alliance program and at Rogers Wireless, Canada’s largest mobile provider, where I oversaw the national partner program for wireless data services.

One thing universally common across telecoms is the ambition to push the boundaries of what’s possible with the tech of the day. But despite this huge focus on innovation, the industry remains hugely regulated, which can hamper the timing of innovation as a result. This is something I witnessed firsthand as I started my career in telecommunications as Director of Regulatory Matters at Unitel Communications.

Understanding and influencing the industry

Telecoms is a fast-paced world that demands a finger-on-the-pulse attitude if you’re going to keep up. For Worldpay to develop its telecoms-ready portfolio, we must always listen and learn. It’s this ethos that underlines our approach to properly understanding and positively influencing the industry.

Currently, I manage teams that actively seek out new business development opportunities across multiple Canadian sectors including telecoms. This means I work closely with our go-to-market teams and solutions experts to ensure that Worldpay has the products and services telecoms need today and tomorrow.

Of course, I work directly with senior executives of telecoms companies, too. It’s a great way for me to better understand pain points while also pinpointing the perfect value-add solutions for specific, often unique, issues. As a trusted payment advisor, we work collaboratively with telecoms companies to develop products and services that overcome the most pressing telco issues of our time.

From reducing costs through fraud mitigation to enhancing revenues through greater authorization rates, Worldpay puts the spotlight on the unique characteristics of the telecoms industry – and it's getting us noticed by merchants looking for a partner.

Telco today

In Canada, the telecommunications market is robust, with a strong contingent of mobile network operators (MNO) and mobile virtual network operators (MVNO) leading the field.

Globally, the landscape for telcos is far different. Regulatory challenges that help or hinder are defined from country to country. So, there’s no centralized regulatory body – other than standards bodies – to equalize and stabilize the market.

For telcos striving to grow, it can feel like navigating a regulatory minefield. This is why staying on the pulse of in-country decisions and regulations is so crucial for success.

Our go-to-market team works to source proven, native experts from any given country. They offer in-depth, country-specific, specialized insights into the regulatory landscape. These experts play a huge role in how we help telcos navigate a new market.

Our changing world and the future of telecoms

The world around us is always changing and this is something I’m always considering at Worldpay. For example, one of today’s most talked about topics is embedded payment solutions within e-commerce software in the payments business. These clients are known as Payment Facilitators or PayFacs.

I work with companies across Canada to implement these payment methods and embedded payment systems that could also be used in the telecommunications sector.

With the introduction of SoftPOS, the payments business – and telcos by extension – are facing yet another shakeup. SoftPOS is set to transform the traditional smartphone into a mobile point of sale terminal. It’s going to be game changing for merchants, allowing for more efficient credit and debit card payment processing.

As with any transformational smartphone product, there’s limitless potential for enhancement and evolution. Over time, I expect to see additional products and apps introduced that will greatly improve the productivity and efficiency of this kind of payment processing.

Additionally, by establishing a PayFac or managed PayFac service, telcos can set up a client’s Merchant ID in store . So, once they leave, the client is ready to start processing payments immediately. This isn’t always the case, but it could be.

The challenges telco merchants face

At Worldpay, we make it our business to stay one step ahead of the key challenges and opportunities facing telco merchants. Here’s what’s being talked about now:

1. Buying a pre-paid mobile phone (burner phone) is plagued by a lack of identity checks, which facilitates excessive fraud. For telcos, this results in a loss of inventory and could even lead to fines issued by the card brands for excessive chargebacks.
2. Telecoms companies process a significant number of recurring payments each month for their post-paid customers. This makes efficient payment processing and enhanced reporting capabilities for portfolio management key priorities.
3. The growth of mobile virtual network operators (MNVO) has led to greater industry competition in many countries. But for some MVNOs, payment processing is hindered by limited available internal resources required to manage the department.
4. As a result of the significant competition in most markets, telcos are looking for ways to enhance their revenue offerings and take better control of customer ownership.

Worldpay has a broad range of payments solutions to support

Worldpay continually invests 6-7% of its revenues in research and development. It’s a big part of what’s helping us anticipate our clients’ demands by developing our industry-leading products.

1. I know how much fraud impacts the industry. While Worldpay has an array of techniques to help telcos tackle the issue, there’s one product that stands out. FraudSight is a multilayered solution that’s ideal for combatting the financial implications of pre-paid mobile fraud and more.¹ It combines unparalleled data insights with advanced technology and payment fraud protection expertise to accurately predict the validity of payments.
2. Open Banking is a key efficiency-boosting product that we introduce into countries with progressive banking and settlement rules. When coupled with real-time payments, the need to use cards for this type of payment is eliminated – enabling telecoms companies to lower risk and costs, enhance customer experience and reduce chargebacks. ²
3. Worldpay offers a range of managed payment services for MVNOs entering the market with limited office resources. As an example, Worldpay can fully manage its Account Updater service for recurring payments. This ensures our telco merchants don’t lose revenue through expired cards. Additionally, Worldpay can provide a fully managed chargeback service if a client doesn’t have the resources to do so.
4. Worldpay is committed to helping telcos enhance revenues through even more efficient payment processing. But we believe SoftPOS is going to be shaping the future of the world with mobility in payments never seen before. According to a report by Juniper Research, merchants deploying SoftPOS solutions will exceed 34.5 million by 2027 – a 475% increase in comparison to the projected 6 million merchants in 2022. ³ It's why telcos that establish themselves as a PayFac and embrace SoftPOS have the potential to realize enhanced revenues and competitive positioning.

The industry is undergoing huge changes, but with every challenge comes an opportunity. This was a key driver for my returning to financial services from Canada’s largest mobility provider over 12 years ago – I could see the two industries were set for an explosive encounter in the future.

And that future is now. It’s an exciting time in telecoms and Worldpay is ready and waiting to help you make the most of it.