Telecoms

Technology

Industry transformation will require a wide range of technologies:

Business Applications

The next wave of transformation for telecoms will have software at its core. Telcos need to move from monolithic OSS/BBS systems to an open, modern, software-based architecture that enable platforms and open APIs. 

 Data, Analytics, AI & Automation

AI is transforming front office, back office and infrastructure.

Like BigTech players, Telco's need to utilise analytics to deliver a better experience though understanding customers. This move to a data-driven world is crucial to driving growth (new products, upsell, cross sell etc.), automating customer journeys to improve experience and remove costs and to introduce intelligence through machine learning and cognitive artificial intelligence.

Telcos will also continue to make significant investments in using AI in fraud and risk management use cases.

Compute & Cloud

 The shift to cloud-native is a key step in the transformation of Telco’s technology to streamline their operations and back office services while finding new efficiencies and cost savings. Accenture says Telcos can realise a 40% saving in CapEx by moving to virtualized, cloud-based architectures. The further opportunity is to leverage cloud to
accelerate asset-light business and commercial models.

Multi-cloud architectures are seen as key to delivering agility, cost and performance while addressing security and compliance challenges. Eventually, container-driven application portability in a hybrid or multi-cloud IT architecture will enable the multi-directional movement of workloads to best execution venues on an ongoing basis for optimisation of cost and application performance. 

New network architecture that facilitates cloud computing at the edge of the network represents an opportunity for Telcos. In this scenario the network becomes an extension of cloud and edge emerges as the new control point. The worldwide edge computing market is predicted to reach $50 billion in 2024 with a CAGR of 12.5% over the 2019–2024 forecast period.

 Networking & Communications

Both fixed and mobile networks are in the middle of an evolution to higher speed architectures; 5G for mobile and Fibre-to-the-premises, or FTTP for fixed networks.

Between 2021 and 2025, 5G will enter the mainstream, with the number of 5G connections worldwide tripling from less than 700 million to 2.1 billion. The adoption of 5G is expected to be faster in its first seven years (2018–25) than the adoption of 4G in the seven years after its own market debut in 2009. However network investment will be significant as operators will need to deploy as many as 100 times the number of cells used by 4G to achieve the same coverage.

FTTP will accounted for 56% of global fixed broadband connections by the end of 2021. However the US and Western Europe lags Asia, Eastern Europe and Latin America. It is expected that Western Europe will accelerate from 26% to 41% of premises by 2025 requiring a large investment. Fixed Wireless Access (FWA) is an alternative access option. 

 Networks are becoming horizontally decoupled, virtualised, cloud native and software defined.

Digital Workplace

Organisations must now provide a digitally enabled, flexible and collaborative working experience to attract and retain staff. They must also move beyond the fast reactions required to achieve a lockdown, where over 80% worked from home.

A modern collaborative digital workplace is critical to a remotely located workforce. It ranges from access to HR applications and core business applications to e-mail, instant messaging and enterprise social media tools and virtual meeting tools. 

Internet of Things & Industry 4.0

 Connected industry solutions – such as IoT and professional services – are anticipated to grow at +28.4% CAGR
up to 2024. McKinsey have highlighted four areas that 5G IoT could increase global GDP by $1.2 trillion to $2 trillion by 2030; these are Mobility (connected vehicles including autonomous, vehicle-to-infrastructure and vehicle-to-vehicle communications), Healthcare (patient monitoring), Manufacturing (smart factories) and Retail (inventory management, warehouse automation and in-store experiences). Additional use cases include smart cities, smart energy and security. Many of these applications will be dependent on  low-power, wide-area (LPWA) coverage initially via 4G and then via 5G. 

Security, Compliance & Data Privacy

Security especially with data breaches is high priority issue. Consumers and businesses will expect Telcos to operate at a very high level of security and privacy, this includes identity management, data security, privacy management and cybersecurity. 

The threat is real as T-Mobile confirmed that over 40 million customer details were exposed in a data breach and a distributed denial of service (DDOS) cyber attack hit multiple UK-based VOIP providers. 

Security and Resilience is also a key regulatory requirement with the new Telecommunications (Security) Act 2021 which is in the process of implementation. The UK General Data Protection Regulation ((EU) 2016/679) (UK GDPR) is also an important regulation for protection of consumer data. 

IT Governance & Management 

In a period of intense digital transformation the effective management of Dev/Ops is crucial in delivering the desired change and ensuring operational resilience.

Effective management of IT assets and licences over their lifecycle is essential to good cost management.