Telecoms.com periodically invites expert third parties to share their views on the industry’s most pressing issues. In this piece Francesco Venturini, Accenture’s global lead for its Media and Communications, looks at what are likely to be the big talking points at this years Mobile World Congress.
The most powerful business models in the digital economy are platform-based. Open platforms are the key to success in the digital economy and to driving economic and social growth. Open platforms enable businesses to move away from the traditional linear relationships with suppliers and customers, to one that is more dynamic and fluid, one that easily connects an entire value chain through well designed APIs, and thus empowers new operating and revenue models, sometimes across industries.
While tech companies that are born digital have long understood the power of platforms, there is very little evidence that the communications and media industries are taking radical steps to embrace the transformational power of platforms to capture new growth opportunities. They are now facing a stark choice: disrupt or be disrupted — and many are doing both at the same time.
Artificial Intelligence offers opportunities for communications companies to transform how they operate, the services they offer and their relationship with their customers, but we are just at the beginning leveraging its potential. From core operations to customer interactions, AI will provide tools that make processes run more smoothly, uncover efficiencies and allow CSPs to better understand and delight customers.
To seize this opportunity, communications companies need to cut through the hype to aggressively educate themselves on the opportunities that AI presents, and carefully analyze their current operations and infrastructure in order to create a strategic plan for experimentation and implementation.
The possibilities are many, and with the right structure in place AI can add value to almost every aspect of a business…so companies should be asking themselves “what shouldn’t we automate?” Key opportunities for AI in communications companies include: cybersecurity and fraud detection, network efficiency, customer service, personalization, and network operations support systems.
Few industries are more attractive to hackers than communications, so expect this to remain a hot topic at MWC this year and for years to come.
The era of digital technologies has made communications companies ever more important to business and everyday life. It is, arguably, a golden age for them. But with that bright future comes significant new risks that could lead to a companies’ networks, data and business systems being compromised. These risks represent a true existential threat.
In spite of news of high profile hacks, communications companies feel they are ahead of the curve when it comes to security. In a recent Accenture survey, they exhibited a higher-than average confidence in their ability to measure a breach, to monitor for one, and to identify its cause. Yet they are still reporting a substantial number with an average of 93 breaches in the last year, with one in every three succeeding.
In the last year alone, we saw high profile cases – Talk Talk was fined a UK record £400,000 for poor website security which led to the theft of personal data of nearly 157,000 customers. Polish companies Netia SA and Nepal Telecom both suffered widely-publicised hacks.
In the face of so many attempts, companies cannot afford to skimp on investments and expertise in security. At MWC, conversations will focus on how communications companies can step up their efforts and adopt new holistic approaches to security that can keep pace with the ever growing frequency and sophistication of attacks.
The CSP’s core business is connectivity. But connectivity is now a commodity market where growth continues to slow and prices plummet, so at this year’s show expect many discussions about how CSPs can drive new revenues. IoT can be a game changer.
Moving beyond connectivity to smarter, higher value services and experiences based on IoT will require new skills and expertise. CSPs need to consider whether to build, buy or partner to make the transition and ensure they can successfully enter the IoT space. Once they make that move, CSPs have the challenge of actually bringing the IoT applications and services to market.
One of the biggest opportunity for CSPs lies in the connected home, yet they have so far struggled to define the right value proposition or business model. The benefits for consumers, such as controlling energy costs, increasing security and having a home that learns how to behave according to personal preferences, are clear. But for many consumers, the promise of a connected home remains a vague and very distant notion: smart home devices can be expensive, complex to install and use, and the value they potentially bring is rarely well-understood.
This is where CSPs have a very clear opportunity. They can leverage the enablement of a larger ecosystem of providers, combined with their consumer data analytics and a digital hub for commerce to sell a seamless, personalized service that delivers on the promise of a smart home to their consumer clients.
Many predict that 2020 will mark the start of 5G roll-outs, but we have already seen Verizon announcing some level of commercial deployment for next-generation wireless in 2017. Expect to see more announcements in the 5G space at MWC and discussions about how to prepare for this evolution of the first scalable, versatile and energy smart network for the hyper-connected world.
Communications industry stakeholders continue to work to define new standards and approaches. As they do that they must consider multiple use cases from high-definition multimedia and VR/AR which require high capacity connectivity, to IoT and sensor networks, which represent a high quantity of connections to self-driving vehicles and other robotic applications which require mission-critical connectivity.
For all these use cases, there are increasing consumer expectations that the 5G network will deliver the highest-quality service and speed. Yet for CSPs seeking to leverage the 5G revolution, transforming themselves from network-centric to customer-centric will not be enough. Their networks will need to cater not just to customers in the classic sense, but also to new categories– machines, vehicles, sensors, hot spots, ‘things’ – in an orchestrated ecosystem, which will have connectivity as a core component and be delivered across multiple vertical industries and devices.
Virtual Reality (VR) and Augmented Reality (AR) are quickly moving from niche to mainstream products, and in 2017 we expect to see a further shift towards Mixed Reality (MR), and the impact on communications providers will be huge. At first glance, the primary impact will be yet another surge in demand for bandwidth, with VR requiring about five times as much as HDTV. However, there are opportunities for communications providers to participate in what could become a $150B market by 2020.
Communications companies will need to create strategies for dealing with additional strain on their networks, while creating new consumer strategies that build on this increased demand for connectivity.
Communications companies are not bystanders in the media industry, and AR / VR / MR is a growth engine for media. Communications companies have the opportunity to create and distribute their own AR / VR / MR apps and content throughout their networks as opportunities to grow customer revenue, or simply to enhance customer experience.
At the same time, partnership opportunities with AR / VR / MR companies should emerge. Communications companies can explore bundled services with AR / VR / MR products sold directly to consumers, much as Google and Samsung have included their VR products as add-ons to their mobile handsets.
The future of how people interact with their computers and devices will center on VR and AR experiences seamlessly integrated into daily life. This year we will begin to see more applications emerge creating compelling experiences that shift smoothly between the physical and digital worlds. These opportunities are still relatively in their infancy, so creativity and vision is necessary for communications companies to realize the potential value of AR, VR and MR in their businesses.
Francesco Venturini is Accenture’s global lead for its Media and Communications industry group. He develops and implements Accenture’s industry strategy program for the Media & Communications practice and leads Accenture Digital Video globally. Francesco has spent more than 15 years working with media and communications companies to help them improve their businesses. He is known for shaping transformational strategies that enable major companies to compete effectively in the multiplatform digital era. He has led large, complex transformation programs—for emerging and established businesses – and been instrumental in revolutionizing the development and launch of disruptive digital video services.