You've seen it in analyst reports, vendor pitch decks, and conference keynotes: "up to 60% cost reduction."
Every time, there's a part of your brain that quietly asks, really?
If you're a CFO, CTO, or operations lead at a telecom company, that skepticism is healthy. It's also costing you. Because that number when you pull it apart, isn't marketing fiction. It's a composite of very real, very specific savings that operators across the UK, Europe, and Australia are already realizing. They're just not calling it by one name.
So let's call it what it is. Let's break down where that 60% comes from — and why the telecoms not chasing it are quietly falling behind.
Why Telecom Costs Are the Structural Problem Nobody Wants to Talk About
Here’s the uncomfortable truth about the telecom industry right now.
Global telecom service revenue is expected to grow from $1.15 trillion in 2024 to roughly $1.32 trillion by 2029, a steady but unremarkable 2.8% CAGR. Meanwhile, mobile ARPU globally is expected to tick down from $6.32 in 2024 to $6.20 in 2029. Revenue is creeping up. Margins are being squeezed from both ends.
And the operators still running on legagcy infrastructure are caught in the worst possible position: high fixed costs, low pricing power, and mounting pressure to roll out 5G services their current systems weren’t built to support.
98% of telecom operators say they need to modernise their BSS platforms to enable new 5G- driven services. And yet, 66% of change initiatives in telecoms dont achieve their intended outcomes.
The gap between knowing you need to change and actually making it work? That’s where billions get left on the table.
What “60% Cost Reduction” Actually Covers
Let’s stop treating this as a single number. It's a ceiling made up of multiple, distinct savings opportunities and most operators haven't honestly mapped all of them.
1. IT Support and Infrastructure Costs
This is the most commonly cited savings category, and the numbers aren't subtle. In Forrester's Total Economic Impact study of Microsoft Dynamics 365 ERP, 60.6% of surveyed organization's named IT support cost reduction as the single most significant benefit they realized. Annual savings spanning IT support, hardware, disaster recovery, and third-party software, ranged from $212,000 to $505,000 per year, per category.
Legacy systems carry brutal hidden tax. Maintenance contracts, bespoke integrations that break with every update; IT teams firefighting instead of building most organizations don't track these cleanly. When you consolidate onto a modern ERP and CRM backbone, the bill drops fast.
2. OSS/BSS Modernisation
This is where the really big numbers live.
Telecom providers have historically run separate BSS and OSS systems for fragmented infrastructure that were neither agile nor cost-effective. When billing, CRM, service provisioning, and network management sit on disconnected legacy stacks, you're not just paying for each system. You're paying for every integration between them, every manual handoff, every error that falls through the gap.
One operator used AI-supported data classification and end-to-end operational lineage to cut data-operations costs by approximately 50% simply by reducing the time teams spent chasing root causes instead of fixing actual problems.
The global OSS/BSS market was valued at $68.79 billion in 2024 and is projected to reach $222.83 billion by 2033, growing at nearly 14% annually. This isn't a trend. It's a structural shift. The operators who modernised early are pulling ahead. The ones still running siloed legacy stacks are absorbing costs their competitors already eliminated.
3. Workforce and Process Automation
Manual processes in billing, provisioning, fault management, and customer service are where hours go to die.
Modern BSS/OSS breaks down the traditional, rigid development cycle shrinking what used to take months down to weeks. When a customer orders a new data plan, that request needs to flow into network provisioning and activate the connection instantly. On legacy systems, that chain involves manual interventions, reconciliation steps, and error queues. On modern, cloud-native infrastructure, it's invisible which is exactly how it should work.
4. Finance Operations
85% of telcos are projected to use AI across finance functions by the end of 2025, with CFOs increasingly doubling down on Microsoft-based AI investment strategies. And for good reason telecom finance is uniquely complex. Subscription models, usage-based billing, multi-currency operations, regulatory compliance across multiple regions it's a function that scales with complexity unless you modernise the core.
Modern ERP platforms like Microsoft Dynamics 365 Finance replace fragmented reporting with real-time visibility, automated reconciliation, and intelligent forecasting. That translates directly into fewer FTEs doing low-value reconciliation work, and faster closes typically measured in days recovered per month.
The 5G Factor: Why the Clock Is Ticking
Here's something the headline cost savings don't always capture: the cost of not transforming isn't just operational; it's competitive.
Cloud-native, microservices-based OSS/BSS architecture allows telecoms to launch products and bundles in days instead of months, giving product managers the ability to configure services and pricing models directly without waiting on IT.
In a market where 5G services, IoT bundles, and edge offerings are being differentiated by speed-to-market, the operators still going through six-month IT cycles to launch a new product package aren't just slower, they're losing customers to the ones who aren't.
Over 80% of Tier-1 telecom operators in North America and Europe have already begun transitioning to cloud-native OSS and BSS platforms. If you're in the remaining 20%, you already know what that feels like.
What Transformation Actually Looks Like on the Ground
The version of this that works, the version that actually reaches 40%, 50%, 60% in cost reduction, doesn't happen because a vendor promised a number. It happens because transformation is done in sequence, with the right foundations.
According to PwC, AI agents deliver significantly more impact and cost less to run when they sit on top of a simplified, modern digital core with standard processes, a strong data foundation, and fewer legacy constraints.
Translation: you dont get the AI savings without the data layer. You dont get the data layer without the integrated core. And you don't get the integrated core by patching legacy systems indefinitely.
The sequence matters. Modernise the ERP and CRM backbone first, Microsoft Dynamics 365 is purpose-built for this, with telecom-specific capabilities across finance, operations, and customer engagement.
Then automate on top. Then layer in intelligence. Done in order, the compounding effect is where those headline numbers come from.
The Real Question Isn’t "Is 60% Possible?" It’s "Where Are You Starting?"
The operators that dismiss the 60% figure are often the ones who haven’t mapped their own cost structure honestly. They don't know exactly what their legacy systems cost to run, not just licensing, but the integrations, the manual processes, the IT time, the slow launch cycles, the billing errors, the audit overhead.
When you map those honestly, the number stops looking like a vendor claim. It starts looking like a floor.
The gap between where you are and where modern infrastructure can take you is almost always larger than you expect. The question isn’t whether the savings exist. The question is how long you can afford to leave them there.
Ready to See Where Your Savings Are Hiding?
If you’re a telecom operator running on legacy systems, or a business that’s been told transformation is a three-year project, you probably haven’t seen a full cost audit that maps your current spend to what a modernised stack would look like.
That’s exactly what Dynamics Monk does.
As a Microsoft-certifies technology consultancy, we help mid-market and enterprise telecom business across the UK, Europe, and Australia map their transformation journey, implement Microsoft Dynamics 365, and make the numbers real, not in a pitch deck, but in your P&L.
Talk to us. The cost of not transforming is already on your balance sheet.
