The telecommunications industry is undergoing a major transformation, with leading operators moving beyond traditional voice and data services to become full-fledged technology companies. Safaricom’s success with its mobile money platform, M-Pesa, illustrates this shift, turning a simple cash transfer service into a comprehensive fintech ecosystem that has become central to Kenya’s economy. According to a 2024 GSMA report, the broader mobile-money sector contributed up to 8.6 percent to Kenya’s GDP in 2023.
While such innovation demonstrates the potential for telcos to solve real-world problems at scale, many operators remain hampered by outdated systems. Legacy operations and business support systems (OSS/BSS), built for simple SMS, voice, and data services, are rigid, expensive to maintain, and unable to support the speed and flexibility required for modern digital offerings. These monolithic systems are not API-enabled, making integration with new platforms and services difficult and costly.
Industry experts note that evolving into a technology-driven operator requires more than just new products; it demands a complete architectural and operational overhaul. Modern, cloud-native, and API-first platforms allow telcos to partner seamlessly with fintech providers, content platforms, IoT ecosystems, and enterprise vendors. Such systems also enable convergent billing and real-time transaction processing, critical for mobile money services and other emerging digital offerings.
Competition in the telecommunications sector has intensified, as new entrants and regulatory pressure have reduced margins and ended the era of guaranteed high profits. Operators are now compelled to explore innovative revenue streams and diversify their service portfolios to remain competitive.
For African telcos aiming to transition into technology companies, firms like VAS-X offer expertise in replacing legacy systems and launching new digital services. With over two decades of experience, VAS-X supports operators in adapting to market changes and expanding their offerings, ensuring they can operate at the speed and scale required to thrive in the evolving digital landscape.