Innovation is the cement between success and sustainability in the telecom industry. Operators are increasing their IT spending, including managed services and consulting, to perceive beyond short-term success to long-term sustainability and plan their digital strategies correspondingly. Gartner Forecasts the global IT spending in the telecom industry to reach US$ 1500 billion by 2023. By driving innovation in technologies like edge computing, mobile private networks, 5G, and IoT, telecom companies look forward to enabling other industries to embark on a journey of a net zero future.
Challenges remain for telecom companies to deliver more agile solutions as the business ecosystem continues to grow complex. The following are some of the major ones.
- Agile-development-based digital technologies make it difficult for telecom companies to decentralize their systems and implement digital solutions across different facets of their business.
- Growing demand and consumption of OTT platforms, such as Amazon Prime, Netflix, and Disney Hotstar, are compelling telecom companies to establish a business model with greater flexibility. Integrating aspects, such as working with new operators, and allocating revenue to new partnerships, in their existing business model can seem difficult for telecom operators.
- What once were separate markets, broadcasting, fixed-line, and broadband are witnessing consolidation. It introduces complications for telecom operators, which can aggravate as trends like smart cars or smart homes gain further traction.
In the modern business world where everything is digital, telecom companies must move away from their legacy systems to incorporate cross-functional collaboration, network APIs, consolidated systems, and governance-as-a-process, if they aim to remain at the forefront of the competition. Before diving into how digital transformation can help telecom companies take big leaps into future sustainable growth, let’s dive into key technology trends impacting the industry.
Telecom Industry Technology Trends
Edge Computing
Edge computing brings the benefits of the cloud closer to the end-use equipment. When it comes to 5G, the edge leverages the cloud’s true potential for industrial IoT applications and radio-enabled devices. These are only a couple of the many edge use cases, and to deploy and manage various such use cases successfully, it will be challenging for the cloud service providers (CSPs) as well as telecom companies to orchestrate resources over the globally distributed data centers. With ML/AI, open APIs, multi-cloud, and network as code, the edge will evolve, resulting in a converged framework to meet the evolving user demands with agility and at a low cost. Hence, orchestrating edge is crucial as it becomes an important pillar of digital solutions powered by the cloud.
Speed
In the telecom industry, users want ‘speed’ more than anything. Next-generation technologies like 5G and IoT are enabling reliable and faster connections, even beyond 300 Mbps. In addition, the rollout of fiber has become a common battleground among telecom operators, giving an extra push to the user demand for fast and unbreakable connectivity. By 2026, users have don’t have access to fiber will still have access to fast connectivity, as 5G subscriptions are expected to increase rapidly and exceed 4.8 billion.
Digital Twins
A digital twin in the telecom industry means the representation of networks driven by real-time data gathered from multiple sources, such as subscriptions, IoT, data lakes, sensors, and edge clouds. By using machine learning and simulation, a digital twin visualizes and forecasts the impacts of different use cases, eliminating the need for implementing them in a physical network. As the service providers enable accelerated digital transformation journeys to address consumer complexities and industry use cases, digital twins will serve as a boon for telecom companies to monitor and enhance system capabilities in real-time.
Internet of Things (IoT)
New management paradigms have come to the fore, with growing connectivity between the telecom infrastructure, cloud data centers, devices, and sensors. Such connectivity is indispensable for the future growth of the telecom industry and for managing energy consumption while providing safer and more efficient networks. For instance, IoT devices’ implementation in the telecom infrastructure will reduce risk and cost, enabled by decentralized systems, predictive maintenance, and monitoring based on conditions. Ultimately, IoT will automate the telecom processes while facilitating the adoption of Industry 4.0.
Building Competency in Addition To Software-as-a-Service (SaaS)
Core SaaS solutions have been enabling simplicity and OPEX-based approach to telecom companies. However, in the foreseeable future, services will be distributed and run on multiple environments that work in coherence to deliver a robust stack of services. Using networks and more-as-a-service on top of Core SaaS will enable telecom companies to transcend beyond basic connectivity to the added value of network-driven insights extracted from digital solutions. The current method of provisioning SaaS will expand to incorporate local sources. It will help the telecom industry to meet the demands of future applications across areas such as virtual or augmented reality and automation, thereby providing enhanced security, low latency, and efficient data transfer.
Artificial Intelligence
The intense volume of traffic from the cloud and the proliferation of IoT has led to the generation of large amounts of data, which will only continue to grow. The information collected from IoT devices and sensors plays a vital role in boosting digital transformation for telecom companies. Big data is crucial as well for telecom operators to analyze success-contributing trends and factors. In addition, high-speed connectivity with low latency is a must. All these together help build best-in-class AI
solutions to reduce latent costs and address challenges apropos of network performance. The telecom industry will most likely incline toward such AI solutions to drive innovation and maintain a competitive edge.
Sustainability
Although 5G is not the only way toward an energy-efficient future, it has the greatest influence. With digital transformation and sustainability developing a covalent bond, telecom companies are emphasizing the all-encompassing boundary to drive value. This boundary will have the potential to promote a sustainable future, driving change to reduce carbon emissions while supporting other industry verticals to embark on a net zero journey. In addition, it encourages change by creating 5G-enabled solutions and technologies to deliver innovative services that promote sustainability.
Telecom Industry – The Role of Cloud Computing and Digital Transformation
The cloud is key to digital transformation, and its adoption is a big trend in the telecom industry. According to Gartner, the cloud is the reason behind investment in enterprise software, as organizations prioritize upgrading to SaaS for supporting continuous agility and flexibility. This is true for telecom companies. The communication service model, network service model, and cloud delivery model are the top three cloud-based use cases for telecom businesses.
The telecom industry is witnessing a surge in effective services enabled by flexible and powerful cloud solutions. It gives telecom operators feasible options for network enhancements and drives innovation. It is imperative to adopt cloud solutions that enable bringing services and infrastructure closer to network edges, where most of the data get generated.
Digital transformation powered by the cloud is enabling telecom companies to enhance customer experience via digital omnichannel services, customer relationship management, social media interactions, and chatbots. By analyzing vast amounts of data using modern data lakes and data warehouses, telecom companies can extract
valuable data for better planning and strategic developments. In addition, by automating workflows, they can achieve improved operational efficiency, reduce human errors, and respond to evolving customer demands with faster GTM.
Conclusion
As telecom companies compete in the digital age, they have new opportunities. However, uncertainty is growing in the telecom industry, driven by rapid technology advancements, emerging regulations, and evolving consumer demands. Companies that prioritize innovation, reimagine network service potential, and focus on development, will see greater growth prospects. Telcom companies must strategically respond to the technology trends while addressing the challenges optimally and translating them to rev up their digital transformation journeys.
