Changes In The Global Telecom Industry

Changes In The Global Telecom Industry

The telecom industry has been transformed beyond recognition from its earliest days, and technology continues to push it in new directions, creating opportunities for new entrants and posing challenges to existing players.

Among the most recent trends that have made us sit up and take note are 5G and the Internet of Things. In one sense, these developments are a threat to existing telcos, as end users gravitate away from services traditionally provided by them. In another sense, however, new technologies equate to new revenue streams, and the goal for telcos is to access those new possibilities for themselves. Lower revenues from voice calls and messages are a reality, but some companies are responding by moving firmly into new markets. Verizon’s deal to acquire the Internet properties of Yahoo! Inc. is one example of a telco buying into a content provider in order to better secure its own future.

The emergence of 5G promises to revolutionize download speeds, and 2017 may well see the industry start to initiate its first commercial offerings of 5G. Fast download speeds are crucial to the successful development of another key trend – the Internet of Things (IoT). If you have a device such as a smart TV or anything that enables remote connectivity, you will already be familiar with the concept of IoT. But as smart appliances become the norm, telecom companies will need to be ready to handle the resultant increase in Internet traffic and the requirement for constant connectivity.

The impact on Internet and mobile technology has been particularly felt in emerging markets. Mobile technology enables remote access to educational resources in rural schools, and supports financial transactions for those for whom traditional banking services are out of reach, to give just two examples of its benefits to developing countries. The absence of fixed line infrastructure was an issue for developing economies in the past, but a new generation of entrepreneurs has leveraged mobile technology to take their countries into the 21st century in terms of how people communicate and how economies can grow around the promise of Internet and mobile.

Take the example of someone such as Ehsan Bayat, who founded the Afghan Wireless Communications Company following the fall of the Taliban regime in his native Afghanistan. Bayat also teamed with the Afghan Ministry of Communications to run Telephone Systems International, the largest mobile company to be based in the country.

Telecom companies are not immune to external changes, and the political disruptions of 2016 continue to make their impact felt. The election of President Donald J. Trump remains very much a wait and see scenario for telcos, especially as the new administration has yet to fully set out its attitude toward the sector, other than a stated opposition to net neutrality. In Europe, the triggering of Brexit, the departure of the UK from the EU, poses a challenge in respect to possible corporate relocations and possible changes to roaming, international call charges, and spectrum.

The challenge for the telecom industry remains largely unchanged from the development of the telegraph and telephone in the 19th century. That challenge is how best to utilize technological advancements to serve our innate wish to communicate with each other, for business or for personal reasons.