GSMA Intelligence has released new insights in a report, Green is good for business: making the financial case in telecoms. The second instalment in a three-part series on sustainability, the report, produced in partnership with Huawei, shows that by investing in greener technologies, telecom operators can boost their financial bottom line.
“While the net zero and environmental imperative are fundamental, green investments should be seen as good for costs and revenues,” said Tim Hatt, Head of Consulting at GSMA Intelligence.
One of the main reasons companies may be reluctant to invest in sustainability is a concern that doing so will be costly. The latest GSMA Intelligence study demonstrates that in the telecom industry, this is far from being the case. For instance, operators could reduce OpEx by 4% for a 20% reduction in energy costs through power efficiencies. This acts as a powerful incentive to invest in power-saving technologies like 5G, AI and Lithium-Ion batteries.
In addition, customers worldwide are willing to support with their wallet telcos that invest in sustainability. With climate change a top concern, 30-60% of telco subscribers surveyed in 16 countries would pay more for mobile airtime tariffs that are certified carbon neutral.
“On costs, energy is still 20-40% of telco OpEx and reducing this by 10-20% can feed through to an EBITDA uplift of 2-4%. On the revenue side, we see opportunities from green-linked tariffs, trade-ins and the sale of renewables,” Hatt added.
The GSMA Intelligence study also shows that telcos are well positioned to financially benefit from the world’s decarbonisation mission. This is because digital technologies can enable as much as 40% of the CO2 savings needed by 2030 from the industries accounting for most of the world’s carbon emissions.
The research aims to give an evidence-based view of why going green makes business sense and how this can be done effectively.
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