The ongoing and increasing volatility of the global economy has unsettled the telecommunications industry in recent months. As 2022 draws to a close, industry experts and innovation-driven companies are exploring and formulating what lies ahead for the telecommunications sector in the coming year.
Driven by emerging technologies such as 5G, O-RAN, and N+aaS, the telecom industry is expected to see tremendous innovation in 2023 and beyond.
5G Will Reach New Heights
Mobile ecosystems are constantly evolving, and companies are looking for ways to make wireless communications even faster with higher capacity and frequency and lower latency. 5G, the latest generation of mobile connectivity, has been touted recently as the harbinger of a quantum leap in wireless network speeds and bandwidth.
However, the technology has yet to improve significantly over Long-Term Evolution (LTE). But that could change in 2023, with true 5G emerging with more deployments of Standalone (SA) networks. 5G SA can be considered true 5G because it enables many of the advanced performance benefits that 5G was designed for, such as low latency, network slicing, and edge computing. These features will likely contribute to developing new 5G-native business and consumer applications.
Moreover, 5G satellite access for Non-Terrestrial Networks (NTNs) will also flourish in 2023. 5G NTN satellite access opens up many opportunities, including 5G coverage in rural and remote areas to fill gaps in existing networks; global 5G connectivity in areas without terrestrial coverage; global mobile broadband and IoT coverage with low-cost connectivity; fixed wireless access; and connectivity for aircraft, ships, and in disaster zones.
O-RAN Is Set to Transform the Mobile Industry
As 5G continues to evolve, many other benefits may arise from its growth, with multiple technologies emerging. One of these is the Open Radio Access Network (O-RAN), a revolutionary technology that will transform the mobile industry. The 5G and O-RAN innovations are developing simultaneously, opening up a new world of possibilities. O-RAN is expected to accelerate the adoption of 5G, lower operational costs, reduce maintenance complexity for operators, and drive innovation in the radio access network ecosystem.
The US-based Open RAN Policy Coalition promotes policies that drive O-RAN adoption to create innovation, and expand the supply chain for advanced wireless technologies, including 5G. Another group of nearly 40 industry leaders, the Telecom Infra Project, is promoting O-RAN as part of its mission to accelerate the development and deployment of open, disaggregated, and standards-based technology solutions that deliver the high-quality connectivity the world needs.
PON Gains Momentum
As it successfully meets industry and consumer demands for energy efficiency, Passive Optical Network (PON) will continue to be the dominant fiber-access technology deployed globally in 2023. Because PONs consume far less power than Active Optical Networks (AON) while enabling connections in the gigabit range and beyond, their importance in this day and age cannot be overstated.
Recent research indicates that the PON equipment market is forecast to grow at a CAGR of 12.3% from 2020 to 2027. This growth presents significant opportunities that span across multiple regions as various operators build, expand, and upgrade their respective fiber-access networks.
Society will evolve even faster as next-generation fiber technologies take hold and open up more opportunities for education, remote healthcare, remote work, entertainment, and commerce.
N+aaS Takes Center Stage
Nokia’s telecommunication experts predict that starting next year, communication service providers (CSPs) will increasingly combine multiple resources, such as public clouds, edge clouds, networks, and devices, to deliver a single service or set of services.
In this regard, the telecommunications giant introduced N+aaS (Network-and-more-as-a-Service), a variation of NaaS, which provides additional “cloud, connectivity, context, and data assets” and is expected to greatly influence the telecom industry in 2023 and beyond. N+aaS will use local resources to meet the needs of future applications, including augmented reality, gaming, or automation that require local anchors to ensure low latency, efficient data transfer, and improved privacy and security.
Network Edge Will Open Up New Revenue Streams for Telcos
The network edge is the collaboration between applications and connectivity, where a device or local area network (LAN) connects to the Internet. It’s also considered one of the most obvious development paths for CSPs looking to keep pace in today’s digital-centric world. Pursuing the network edge holds significant new revenue opportunities for CSPs by enabling them to leverage their growing cloud-based 5G networks and, at the same time, assert their relevance in the larger digital value chain.
The network edge is expected to expand, as CSPs and technology companies form closer partnerships in the coming year. CSPs will move up the edge stack, getting closer to applications and taking an active role in orchestration, while CSP edge platforms and public cloud companies will work closely together. Therefore, in 2023 and beyond, interoperability and optionality will become key competitive advantages for CSPs as they work to attract customers with complex cloud requirements and deployments.
The Bottom Line
In light of the pandemic, current geopolitical and environmental crises, and recessionary pressures, the continued instability of the global economy highlights the need for companies to be aware of key industry trends and adapt to change. Despite the less favorable economic factors, the telecommunications industry is expected to see significant growth in the coming years, driven primarily by emerging technologies and new approaches to meeting consumer needs.
