Harnessing new technologies is at the heart of profitability for the modern telco, but with so much hype and noise surrounding these developments, how can telcos really identify meaningful opportunities to innovate?
2020 has been a year of transformation for telcos. With the coronavirus pandemic sending demand soaring and 5G beginning to be rolled out in earnest, the telecoms industry has had to not only quickly overcome huge challenges, but completely overhaul their business models.
Unsurprisingly, many of the key opportunities for telcos lie in maximising the value of technical innovations, championing the latest technologies to improve their networks and provide their customers with unique and valuable services.
Our recent Total Telecom event entitled “Delivering innovation for telco transformation”, delivered in partnership with Intel, helped drive discussion on three of the key areas which are coming to define the success of a modern telco.
5G and Communications
Unlike the jump from 3G to 4G, the transition from 4G to 5G is set to fundamentally alter the way telcos do business. This new technology, with its lower latency and increased capacity, not only offers mobile customers simply a faster internet connection, but will enable further innovations like network slicing and edge computing that will allow major revenue to be driven from enterprise use cases.
“There are a number of innovative components to 5G that sets it aside from previous generations; network slicing being one, of course, but also 5G private networks and mobile edge computing,” explained Maziar Nekovee, Head of Centre for Advanced Communications, Mobile Technology and IoT, University of Sussex.
“Most of the verticals are embracing digital,” said Francesca Serravalle, Emerging Technology Director, Colt Technology Services. “They are really changing and innovating their operational and business activity to become data driven – Covid-19 has also accelerated this process.”
But technologies like mobile edge computing are still in their infancy and can be expensive to implement. As a result, companies need to be sure they are approaching these new 5G-adjacent technologies intelligently in order to get the maximum value.
“First things first, to lay the right foundation you need a cloud platform,” explained Daniel Lynch, Segment Marketing Director, Intel. “That cloud network will be optimised for network function, in this case RAN. That’s the first step – its improving cost, power, ease of management… it meets the Capex budget right now. And then you can slowly start adding in additional services.”
For telcos, AI is no longer optional; it is a necessity. AI can handle large amounts of data in a way traditional resources cannot hope to achieve, allowing the optimisation of everything from the network itself to customer services.
“As of today, I think the largest value of AI is created within the enterprise itself.” explained Richard Benjamins, Chief AI & Data Strategist, Telefonica. “By applying it to all sorts of internal use cases related to understanding customers better, improving your marketing, optimising the network deployment or procurement process… any significant process that moves a lot of money − if these can be improved by a small percentage, that generates a lot of value.”
But AI is not only about optimisation. In the future it will be able to harness data to create entirely new sources of revenue for the telcos themselves.
“AI has to become the core of business for telcos,” said Azadeh Yazdan, Director of Business Development, Artificial Intelligence Products Group, Intel. “Everyone is looking at two different ways of utilising AI for telcos; one is around automating the network operation, and the other is about generating new revenue streams. Data is being generated at every step of the way throughout the customer journey – all of this data can be used to generate new revenue.”
IoT & Edge
In the most simplistic sense, the IoT is nothing new. Connected devices have been around for many years, but it is only now, in the era of 5G, AI and edge computing that we are beginning to realise this concept’s true potential.
“We’ve moved beyond just connected devices,” said Karen Truitt, Global Director IoT Sales at Intel and moderator for the panel. “We are now involved in making the devices smarter and more intelligent. The next step is how do we make those devices not just smarter, but autonomous. We’re starting to see the evolution bringing in 5G, AI, cloud technologies and now edge compute.” If you want to hear more from Karen Truitt about empowering IoT and the edge, check out our exclusive interview here.
The value of the IoT and the edge for telcos can come in many forms. A network of connected sensors in a factory – an idea central to the concept of Industry 4.0 – is perhaps the most celebrated example, but applications can extend to anything from healthcare to entertainment, all facilitated by the telco’s technology and connectivity.
But what should also be remembered is that this advancing technology is not only about the connected devices themselves, but the ramifications these may have when it comes to the way we live and work.
“The market is structuring very quickly around smart industry,” said Alex Lorette, Director Enterprise Solutions, Proximus. “We see mobile private networks, 5G, and edge technologies really converging and being the perfect match to unleash new use cases. It can be monitoring for manufacturing machines but also monitoring the workers within an industry site. It is here we see the power of combining these technologies because, of course, the best latency you can get is by combining a very impressive mobile network performance with edge computing.”