Telecom Operators have faced their fair share of structural challenges, especially in view of the past two years of global crisis. However, there has also been a remarkable growth in areas like mobile connectivity, consumption of digital services, and digital transformation of businesses, with this growth wave still nowhere near saturation point.
In light of this, telecom CIO’s sector-wide are considering new ways to improve their digital engagement and to keep their operations running smoothly. Therefore, the big question becomes: What steps can telecom companies take to thrive in 2022?
The advancement of technology has been a double-edged sword for telecoms bringing forth its own set of benefits and challenges for companies. While the new and innovative platforms have afforded a much larger subscriber base or geographical reach to telecoms, the security risks, heavy loads, and the need for 24/7 support availability has also been a cross to bear for them.
On top of this, the telecom sector is evolving at such a rapid pace that it is crucial for companies to catch the wave of opportunity, or else risk being swept by it. From the dramatic shift to cloud platforms and microservices architecture to the adoption of 5G technologies, CIO’s are making heavy investments in automation and digitization of business processes.
This makes it pivotal for OpCos to find the right technologies that fits their needs, and not only enables them to take advantage of the tech wave but also do it cost-efficiently.
So without further ado, the five most predominant market trends and emerging technologies that have taken the telecom industry by storm include:
1. 5G Technology
Wireless connectivity, which is a key catalyst for growth, is enabled by the deployment of 5G technology which is an essential building block for the interaction and connection of billions of devices of almost any kind. Therefore, despite the continuous growth and dominance of 4G in the markets, many have taken a leap and upgraded to 5G, which is now rapidly gaining pace. The motivation for the investment of resources in 5G is driven by the desire to be the industry leader and to be ahead of the curve.
In the post 5G era, where digital giants are spending tens of billions of dollars on content creation, many telecoms are not equipped with the right technology platforms to deal with this major digital shift. This makes it critical for them to double down on what they know best; renewing focus on better infrastructure by harnessing the power of 5G for the use of digital solutions and platforms.
In a nutshell, 5G technology will also change the role of telecom operators from technology distributors to service providers.
5G is expected to have a strong presence in the European, Asian, and North American markets. To support this generational shift and further drive consumer engagement, operators are expected to invest around $1.1 trillion worldwide between 2020 and 2025 in mobile CAPEX, roughly 80% of which will be in 5G networks. By 2025, 5G will account for 20% of global connections, with take-up particularly strong across developed Asia, North America, and Europe. (GSMA, 2020)
2. Internet of Things (IoT)
IoT growth is a major long-term opportunity for telecom operators. Through this, you have the scope to leverage current experience and knowledge about customer engagement to improve retention rates.
The usage and value of IoT for telecom operators is more than just providing better connectivity to consumers. Instead of focusing solely on expanding network connectivity, telecoms can also reposition themselves as IoT access providers. They can further equip their supply chain partners with the right tools and knowledge to promote this technology.
It also presents an opportunity for telecoms to not only turn unstructured data into actionable insights but also offer a range of diversified products and services which extend beyond their existing offerings. From location information to data usage patterns, telecoms can extract valuable information from the data running through their system with IoT technology.
The growth for telecom operators will come from a combination of the consumer and enterprise market, where the major contributor will be the enterprise. Connectivity is one part of the revenue opportunity but it also opens up opportunities for completely new service offerings.
In stagnant telecom industries where products and services are primarily commoditized, IoT solutions enable telecom operators to expand their horizons with new and innovative offerings. They provide greater connectivity within the distribution chain which leads to greater cohesion and synergy between platform players like service providers and resellers.
With the help of IoT technology, telecom operators will also be able to monitor and control their data centers and base stations remotely. This not only enables them to build trust with the other network players but is also highly relevant in the time of unprecedented coronavirus pandemic. Through this, companies can also improve their customer experience by minimizing their downtime.
3. Cloud platforms
According to a 2020 Annual Industry survey by Telecoms.com Intelligence state, 42% of the companies have made cloud a priority as a critical investment area.
Cloud based platforms and cloud clouding acts as an enabler for technological transformation for telecom operators.
We can safely say that cloud computing has catalysed change and driven innovation in the telecom industry. By providing new platforms for creating and delivering business values, cloud allows companies to explore unique revenue growth opportunities. This has shifted the competitive landscape for telecoms, making it pivotal for them to follow suit.
Keeping in mind the global pandemic that has taken the telecom industry by storm these past two years, cloud computing is one of the few technologies that can not only facilitate companies to recover from the crisis but help them thrive in spite of it.
It establishes high and flexible scalability for telecoms by giving them the ability to scale up when the demand is at an all time high and allow them to scale back down when the chart falls to optimize costs. Since automation and adaptability are the building blocks for cloud and it is based on a well-architectured approach, it also allows for the timely self-healing of a system.
By leveraging cloud computing, telecom operators can achieve faster time to market and minimize costs as they only pay for the services that they actually use. Aside from the automation of processes and operations, cloud computing serves as the foundation for generating new revenue streams and market growth opportunities through tech solutions like data analytics and 5G.
4. Artificial Intelligence
In the era of advanced digitization and fast technological development, the use of Artificial Intelligence and Big Data is becoming increasingly popular in the telecom industry. From developing automatic, self-optimizing networks to predicting anomalies and proactively fixing problems before they snowball into bigger issues, Artificial Intelligence solutions are the gateway for achieving strategic growth objectives for telecoms.
A competent analytics platform can facilitate telecom companies in deriving value from sophisticated algorithms and machine learning by predicting the future from historical data.
Companies can get to the root causes of their problems and not only fix prevailing issues but also take preventive measures to avoid future roadblocks. In the long term, it can allow telecoms to deal effectively with their emerging and unique business needs, successfully create new customer experiences, and also underpin their major strategic goals.
5. Smart Capex
Network investment decisions are among the most difficult for operators to address. According to GSMA, network operators are expected to spend 1.1 trillion dollars in CapEx infrastructure between 2020 and 2025, making CapEx optimization at the top of the agenda for telecom executives.
By using a high-caliber solution that eases this decision-making. Telecom operators can select their optimal network investment candidates that maximise the impact of the entire plan while matching the operator’s commercial, financial and technical constraints. What’s even better is that the CapEx efficiency gained can then be translated into overall budget savings or reallocated to other projects.
Telecoms can further use the insights offered by the solution to make informed, timely, and data-driven granular investment decisions to achieve higher ROI.
The year of 2021 has been primarily defined by resilience, recovery, and defensive strategies for telecom companies, but with 2022 looming ahead it is now time for telcos to take the reins back and go on offense. It is pivotal for them to step forward from the sidelines and take initiative regarding digital transformation and innovative tech solutions. This is especially important since the market trends and technologies that were once seen as ‘new and emerging’ have now taken the telecom sector by storm and are now ‘evolving and maturing’.