A Look at Telecommunications Trends in 2018

Video streaming from sites like Twitch.tv and YouTube and the growing usage of augmented reality games and apps — such as Pokémon Go, Ingress and SnapChat — have caused consumer data consumption and use to soar, putting huge amounts of pressure on Wi-Fi and other telecommunications networks as they attempt to cope with the demand.

In light of these changes, many trends have continued over from 2016, while other, fresher trends have emerged to steer the telecommunications industry over the past months. Here’s a list of several trends that have helped shape the telecommunications industry throughout 2017.

Security

More and more, network operators — and companies as a whole — are beginning to realize they need to take bigger, better steps when it comes to the data they store or that they allow to flow over their network. It seems like not a week passed in 2016 without news of a data breach or a network being compromised in some other way. Unfortunately, it seems like this trend has continued into 2017, especially with news of the Equifax data breach that happened earlier this year.

The company announced the breach in early September, but it is posited to have lasted from mid-May to early July, having only been discovered by Equifax on July 29. A massive number of consumers have been affected as a result of the breach, with the Social Security numbers of a potential 143 million consumers compromised.

Breaches like this have made telecommunications companies and the people who operate their networks realize they need to protect more than just the data that gets transferred over the network. Networks have become increasingly defined by the software that comprises them, which has made their infrastructure as vulnerable to attack as the data that flows through it.

The end of 2016 and the beginning of 2017 have seen more and more telecommunications networks and network administrators roll out network-wide and even business-wide encryption. New legislation, such as the European Union’s General Data Protection Regulation, has driven a broader adoption of encryption across networks and businesses.

But telecommunications companies need to be worried about more than just the data they store. Another huge concern is the data they show others, which can raise safety concerns for their customers.

One of the major pieces of data that can put a customer in danger is their location data. SnapMap, a feature installed as part of SnapChat software updates on June 21, 2017, shows a user’s location to their friends using a combination of the phone’s GPS signals and a street map similar to those used by Google Maps.

Unlike many apps, adding friends on SnapChat doesn’t have to be reciprocal. While users who wish to find their friends on SnapMaps have to have reciprocally added the person, this has still left it open to criticism by lawmakers and other public officials. Many worry about the possibility of minors broadcasting their location to everyone on their contacts list.

Snapchat has assured concerned parties the safety of the community is of utmost importance.

5G

The race to be one of the first telecommunications providers to roll out 5G services has continued throughout 2017.

Many telecommunications companies had already developed infrastructure and initiated field tests for them by the end of 2016. As of May 2017, both AT&T and Verizon have begun to launch pre-5G services. However, the standard for 5G services won’t be set until 2018.

Still, 5G Internet has one huge advantage over current 4G services: capacity. Consumers can expect 1GB caps to move to 10GB and, consequently, 10GB aggregation services move all the way up to 100GB, mostly to cope with the strain already put on current 4G networks and to help lay the groundwork for future 5G networks.

At this point, however, companies can’t offer competitively priced home Internet on the current 4G networks, mostly because of the 190GB of Internet the average home uses per month. Being able to easily support this would most likely increase competition between Internet companies in the U.S., where more than half of Americans have only a single option when it comes to home Internet service that’s 25Mbps or higher, according to an FCC report released in 2016.

There is also increased interest in 5G infrastructure from other industries outside the traditional telecommunications market, including in energy, agriculture, business and transportation, who all see the vast potential of 5G to change the way they deliver their goods and services.

While AT&T and Verizon’s pre-5G launches are happening this year, the first official 5G launches won’t come until 2018, with more widespread deployment not occurring until 2019 at the earliest. Smartphone chip-maker Qualcomm has said its Snapdragon chipset will support 5G by 2019, so, with Qualcomm chips being in most U.S. smartphones, expect to see 5G phones rolled out on U.S. cell carriers by 2019.

The Internet of Things

There’s a growing demand by consumers for an Internet of Things — the network of physical devices, vehicles and other items that are embedded with electronics, software and the ability to connect to a network, which enables these objects to collect and exchange data among themselves.

The Internet of Things is expected to add billions of new data sources across the globe by 2020. One of the largest sources for new data could be Tesla, which had produced 51,206 vehicles by the end of the first half of 2017. Tesla CEO Elon Musk announced plans in the latter half of 2016 to set up a ride-sharing service similar to Uber, except with self-driving cars instead of the stereotypical taxi.

All of these new devices on the market mean that we’ll quickly blow past exabytes — 1 billion gigabytes — and into the zettabyte — 1 trillion gigabytes — range. But it’s not just data and data sources that are expected to grow as part of the Internet of Things: Companies are expected to grow, too. According to Bloomberg, computer and technology giant Dell is expected to double down on the Internet of Things, spending $1 billion over the next three years to create a research and development division focused on connecting everything from cars to light bulbs to the Internet.

Things Businesses Should Be Mindful of as They Plan to Grow Throughout 2017 and 2018

There are three main areas telecommunications carriers should focus on if they plan to grow throughout 2017 and into 2018: services, infrastructure and operations.

Telecommunications companies should continue to offer services that are reliable and affordable, while still maintaining a reputation for quality. The challenge for 2017, however, has been capital allocation: Carriers need to make upgrades to the infrastructure of their core networks. These enhancements especially apply to carriers like AT&T or Verizon, who are attempting to roll out 5G services by the beginning of next year. Unfortunately, they’ll need to split that capital among several other ventures, as well: The Internet of Things, autonomous vehicles, mergers and acquisitions and expansion to international markets.

To get out into these other ventures — especially the Internet of Things and autonomous vehicles — telecommunications companies will need to upgrade their network infrastructures. With the average household using 190 GB of data monthly, data usage has increased, and it shows no signs of slowing down over the next year.

Because the connectivity of their core networks is still central to many telecommunications companies’ income, that same connectivity needs to be a central strategy for the rest of 2017 and on into 2018, especially since 5G trials and deployment are a focus for carriers in 2017 and 2018. Infrastructure upgrades mean service upgrades, as well: Carriers want to be able to offer improved and expanded services to their customers, whether this is through the use of small cells, an increase in network density or installing more fiber infrastructure.

The single most compelling thing a telecommunications company can offer its customers is an increase in the amount of data that can pass through its networks at any given time. Every customer wants to see their Internet improve, especially those that deal with Internet speeds of 25 Mbps or lower. Investments in telecommunications network improvements — such as fiber-optic networks, 5G upgrades and deployment or other networking technologies — are critical to preparing the company to work in dynamic, competitive environments. Every successful telecommunications company will be armed with a state-of-the-art infrastructure, sufficiently flexible to handle new and more profitable opportunities.

When it comes to what kind of equipment is used to run the network, many network operators and administrators are moving away from hardware-based solutions using proprietary network equipment and more toward software-based networks using technologies like software-defined networking. The shift away from hardware and more toward software-based solutions will allow telecommunications companies to manage their networks more efficiently so they can be more responsive to changes in their customers’ preferences.

However, companies making a move from hardware to software should be mindful of the security risks such a changeover poses, especially in the area of security. Companies that make the change to software-defined networking need to be mindful not only of the data they hold for their customers, but also the data they allow to pass over their networks — including things like customer location data.

Modernizing Telecommunications Operations for the Coming Decades

While moving into new revenue streams such as the Internet of Things, autonomous cars and the incoming 5G network trials and deployments is a great way to improve growth, telecommunications companies also need to improve the way they operate, and that doesn’t just mean upgrading their equipment and infrastructure.

Companies need to focus on some fundamental goals to show they have the “right to win” when it comes to entering into new spaces and revenue streams.

One of the biggest things a telecommunications company can focus on is simplification. While at most companies, “simplification” is code for targeted cost-cutting campaigns designed to improve overall profit margins, it is not and cannot be the endgame. Companies need to take a dynamic approach to simplification so the pared-down offerings serve as a later foundation for growth. The remaining portfolio of products and services should be essential to your customer base — essential enough that you can maintain customer loyalty, while simultaneously making infrastructure moves to better benefit the company, such as moving services to the cloud.

The second big step telecommunications companies can take when it comes to modernizing operations is that of digitization. A telecommunications company should be in the vanguard when it comes to adopting digital technologies, whether in the call center or the back office. As part of this, both customer care and sales channels — whether they’re online or physical — should be linked so all consumer data can be routed to and maintained in one single database. This makes interactions with your customers across all channels cost less in terms of time and resources expended, while enhancing customer convenience and increasing satisfaction.

When it comes to digitization, one of the ideals telecommunications companies should strive for is to cut down on the amount of human intervention required for customers to solve their problems: Customer communications should move away from the traditional call center and more toward well-designed, well-researched messaging platforms and mobile apps.

To get to the digitization stage, your company may need new capabilities, including analytics expertise, so you can generate the maximum amount of value from each customer.

While one of the big things companies need to focus on for modernization is simplifying their services, one of the things they cannot simplify is who manages those services. Companies need to separate their internal, corporate IT services from those that deal with customers and customer-focused digital services efforts.

Separating services into their component parts is one of the big things companies can do to help speed along modernization. After developing a modernization program — and even while it’s being implemented — a telecommunications company should work on adopting a company identity or identities relevant to their customers so it can offer them a set of distinctive, valuable services.

When it comes to what identity to use, valuable services, companies can choose to go back to basics — using the core connectivity that was the start of their business as their strategic identity. Many startups have chosen to do this — bet everything on a basic wireless service at the lowest possible cost. This is great for startups because they don’t have the legacy costs that would tie other companies down.

For those companies, a wholesale business makeover is an option, but they need to tread carefully. Telecommunications companies have at various times tried to sell their own handhelds and other devices, build service portals and taxonomies for apps and entertainment and provide outsourced information technology and other troubleshooting services to their customers. The results, however, have been mostly disappointing, due in large part to corporate cultures and capabilities gaps that put telecommunications companies at a disadvantage in broad, commercial markets.

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