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EDITORIAL Is the telecoms industry at a crossroads?

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The recently published Top 10 list of concerns within the telecoms industry from consultants EY makes grim reading. Like a grim end-of-term report card, it lists a host of ‘failures’ that the industry itself sees need addressing – and many consumers would agree.

Brace yourselves: the list is upsetting:

  • Failure to ensure infrastructure reach and resilience
  • Underestimating changing imperatives in privacy, security and trust
  • Failure to redesign workforce structure and skill sets
  • Failure to mitigate supply chain disruption
  • Poor management of the sustainability agenda
  • Inability to scale internal digitization initiatives
  • Ineffective engagement with external ecosystems
  • Failure to maximize value of infrastructure assets
  • Failure to take advantage of new business models
  • Inability to adapt to changing regulatory landscape.

I don’t think I have ever written a story for any news site with the word failure so frequently dotted throughout.

But if you put that aside for now, the list is pretty much as you’d expect. The telecoms industry is still struggling with a range of issues – network resilience, failure to use new business models, inability to adapt to new landscapes – that it has always struggled with.

These few issues have always dogged the telecoms industry. It is so large and unwieldy that, rather than a supertanker that takes miles to stop and make a turn, it is a titan relentlessly sailing on towards the iceberg.

Factor in that many of the other issues its faces – sustainability demands, workforce and supply chain problems – are recent arrivals borne out of the pandemic and you have quite choppy waters ahead for the industry.

This set me thinking: have we reached a crossroads? Has the telecoms industry as it stands veered too far off the course that modern consumers need it to take?

I think we may well be at a watershed moment. Look at what consumers are actually doing if you want to gauge how well or badly the established telecoms market is.

According to Insider Intelligence’s annual “Global Media Intelligence Report” on key digital trends worldwide, ownership of PCs and/or tablets continues to fall in many countries. Smartphones are already the primary—and sometimes the only—digital device owned by many internet users around the world. As advanced handsets continue to consolidate that position, larger-screen devices may be destined for a secondary role.

Smart TVs are gaining ground as high-quality in-home entertainment becomes a must-have. In all but a handful of countries, smart TV ownership rose by several percentage points year over year.

Adoption of other smart products has accelerated. In 2020, a small minority of internet users polled owned a smartwatch, but momentum was building. That trend continued this year, with penetration climbing significantly in most countries.

While on the face of it the massive increase in use of smartphones should be a good thing for MNOs. In reality, it isn’t. What the study shows, I believe, is that consumers are using phones and other smart devices – TVs, smart assistants and rudimentary home IoT – in increasing numbers and they are doing it on wifi.

In fact, my kids tend to only use their devices if they are on wifi, eschewing networks not because I don’t want to pay their bills, but because they think they are very poor, They are used to super-fast broadband at home and at school, using 4G and even 5G is a joke to them.

5G was meant to change everything – and it still might – but with a study by NTT Data UK finding that only a third of European telcos actually have a 5G strategy this isn’t going to change any time soon.

In fact, it is unlikely to change at all in the time it takes for those top ten problems to come home to roost.

Private LTE and private 5G networks – as I discussed here – are on the rise: this is where the money is. And telcos need to get on board with this while making public networks better and/or much cheaper and more fit for the modern user or risk seeing wifi providers and other new networks eating their lunch.

 

 

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