Infosys strikes a megadeal with Liberty Global to cement its presence in the telecom industry

Enterprise leaders in the telecom industry are grappling with the urgent need to integrate advanced technologies, meet growing demands for high-speed data and connectivity, and enhance customer experiences amidst fierce competition, wafer-thin margins, and economic instability.

Liberty Global, one of Europe’s leading telecommunications companies, has embraced these challenges by unveiling a megadeal with Infosys. Within a five-year contract, estimated at €1.5 billion (with an optional eight-year extension at €2.3 billion), Liberty is outsourcing the operation of its Horizon entertainment and connectivity platform to Infosys, supporting 10 million subscribers across six European countries. This deal is positioned to reduce the cost-per-subscriber and allow Liberty to realign resources and investments into other business areas.

In turn, by entering into this deal, Infosys has further bolstered its already strong telecom and media portfolio.

Infosys is spearheading new value-driven deals, emphasizing innovation and technology leadership

This marks Infosys’ second major European engagement this year (more than $1 billion total contract value), following Danske Bank, where significant trust has been placed in Infosys to drive long-term innovation and technology leadership. At HFS, we see Infosys’ new deal style as a shift away from the traditional services model, enabling Infosys to drive the following trifecta of value:

• Better technology foundation: Modernizing core systems, automating broken processes, and moving activities into the cloud can significantly impact cost; less time is needed to oversee processes, legacy applications can be retired and consolidated, and leadership has better data to base decisions.
• Access to deep talent expertise at scale: When partnering with a firm like Infosys, the largest lever to pull is the availability of niche expertise to deliver value more efficiently.
• Ability to focus on the core: Liberty can now focus heavily on achieving business outcomes through better technology deployment.

Infosys’ commitment to driving AI-powered digital entertainment is a key factor in securing this long-term engagement

Infosys has a long-standing relationship with Liberty Global. But it takes more than tenure to win megadeals in today’s climate. Infosys has had to develop years of trust and confidence to encourage Liberty to commit long-term.

From our perspective, we believe Infosys clinched the deal with Liberty for three key factors:

• Artificial intelligence (AI) expertise with Topaz AI: Infosys showcased its AI capabilities through its offering of AI-first services, solutions, and platforms leveraging generative AI (GenAI) capabilities. Through Topaz, Liberty can tap into a suite of more than 12,000 AI solutions and platforms. Liberty can also benefit from the Infosys Cobalt for cloud solutions.
• Extensive telecom experience: Infosys’ 25+ years of experience in the telecom domain is illustrated by active investments in RDK (Reference Design Kit), an open-source platform standardizing functions in video, broadband, and IoT services. This deal will also see more than 400 Liberty employees joining Infosys, enhancing its industry expertise.
• Operational efficiency and cost savings: Infosys demonstrated a solid ability to harness AI to enhance operational efficiency and reduce costs, which resonated with Liberty’s vision to reduce costs per subscriber. The collaboration is projected to deliver annual run-rate savings in excess of €100 million per year.

The telecom industry is a hotbed for innovation, yet it grapples with data security and human resources

Few industries are moving as fast as telecom. It has been a vanguard of technological progress due to the relentless demand for connectivity in today’s digital world. The continued convergence of advanced technologies such as 5G, AI, and edge computing has created a fertile ground for innovation and experimentation in this industry.

To harness these technologies and capabilities, the telecom industry must tackle core challenges, including data security, finding quality staff, and a lack of data governance (see Exhibit 1).

Exhibit 1: IT leaders’ top challenges in TMT in meeting strategic objectives are data security, hiring staff, and a lack of data governance

Question: What are your company’s challenges to meet your strategic objectives?
Sample: HFS Pulse 2022; 66 IT executives across Global 2000 enterprises; telecommunications, IT, and media industries
Source: HFS Research, 2023

To solve these challenges, enterprises can strategically partner with technology vendors to access specialized expertise, tools, and resources without sacrificing focus on core activities.

The Bottom Line: In an ever-evolving telecom industry, success hinges on leaders’ ability to identify and collaborate with innovative partners that can amplify their capabilities.

For telecom leaders, the partnership between Liberty and Infosys serves as a blueprint, highlighting the potential of collaborating with vendors to outsource capabilities and access advanced features, freeing up investments for value-driven business areas.

As this play represents Infosys’ bid to take the lead in the telecom sector, the outcome of this partnership will define its future as a frontrunner in this industry.