The telecommunications industry is rapidly evolving, with 5G technology, cybersecurity, AI, VR, energy efficiency, and the metaverse being the top trends for 2023. Once leveraging these trends, telecom companies can reduce network operating costs, optimize data management, secure network infrastructure, and provide immersive marketing and employee training experiences through the metaverse and VR.
To help you adopt these trends and maximize your company’s performance, this article explores the benefits and challenges of these practices and real-world examples of how telcos have achieved impressive outcomes with these technologies.
Progression in 5G Technology
5G is the most improved broadband technology for mobile and notable progress from 4G, which is not as fast and reliable. Essentially, 5G provides more stable and secure remote connectivity leading to faster network infrastructure, lower latency, and high-capacity networks.
According to Statista, 4G networks dominated 58% of the total telecommunications technology market share in 2021. By 2025, this market share is projected to decline to 55%, while 5G rises to 25%. In addition, Statista indicates that countries in the Gulf Cooperation Council (GCC) are adapting 5G the quickest—by 2030, 95% of these regions will rely on 5G.
Challenges
While there are many benefits to 5G technology, telcos may face a few obstacles. First, mobile devices at the user end must be upgraded and compatible with 5G. While 60% of smartphones in the US have 5G, in regions like Latin America and Africa, this is not as common. Next, 5G implementation is slow and costly, and finally, there are many more cybersecurity risks compared to 4G.
Next, let us explore a real-world example of 5G for companies in the telecommunications industry.
Case Study
BLISK provides a digital workplace for remote teams and freelancers to test web applications. But for real-time control, while manufacturing BLSK, developers could not find current technology to solve their problem—they needed a one-millisecond ultra-low latency. Fortunately, the introduction of 5G could achieve this, and these were the results:
- Reduced annual production costs by €360 million ($385 million).
- Reduced CO2 emissions by 16 million metric tons per annum.
Improved Cybersecurity
Cybercriminals prey on telcos’ security vulnerabilities to access and exploit their customers’ data—private information, personally identifiable information (PII), financial details, protected health information (PHI), etc.
According to Grand View Research, the telecom-cybersecurity market reached $33.03 billion in 2022. By 2030, it is expected to reach $82.64 billion, with a compound annual growth rate (CAGR) of 12.1%.
Furthermore, a report by Infosys proves that 88% of successful telecom companies identify cyberattacks by hackers as their primary concern. In addition, 80% of these businesses believe corporate espionage is another issue, while 73% point to low employee awareness. According to the same Infosys report, 72% of telco executives leverage compliance as a solution, while 68% are hiring cloud access brokers, and 66% rely on data encryption.
Challenges
Despite these advantages, a lack of proper team training and adequate technology make cybersecurity challenging for telcos—your employees must understand how to identify, solve and prevent cyberattacks. Similarly, you must opt for technology compatible with your network infrastructure.
Case Study
Finding a solution to these challenges, CyberProof collaborated with a telecom company to optimize their cybersecurity based on local compliance requirements. To achieve this, CyberProof developed a roadmap of potential risks, auditable documentation (to track progress), and an inventory of secure coding methodologies tailored to the business’s standards. Here is how cybersecurity helped this telco:
- 35% increase in application development productivity.
- Improved management of software and cybersecurity risks across departments.
- Fulfilled cybersecurity compliance regulations.
Adaption to Cloud Software
Cloud computing can help telcos reduce costs due to their flexible, pay-as-you-go models. Companies only have to pay for services they require, and they can add and remove resources on demand. This provides businesses with an agile solution they can mold to the ever-changing needs of this industry. Additionally, cloud computing enables telcos to automate various workflow and processes, which saves significant amounts of time.
According to MorderIntelligence, North America invests the most in cloud software for telcos, with a CAGR of 19.9%. Moreover, GlobeNewswire predicts that the telecom cloud software market will exceed $115.6 billion by 2030.
Challenges
When telcos migrate to the cloud, there are many challenges to consider. To start, if they do not have reliable access to the data source location or use the appropriate bandwidth, data transfers will not be efficient. In addition, migrating large volumes of data is costly and highly time-consuming.
Case Study
To address these challenges, Telecom Argentina developed a hybrid multi-cloud strategy, using Google Cloud for in-depth analytics and data storage management. Working together, they created an infrastructure to solve customer experience challenges using Google Cloud’s data science tools. Here is what they achieved:
- Reduced implementation and operational costs without the expenses of maintaining and purchasing physical equipment.
- Improved efficiency by running multiple network simulations simultaneously.
- Machine learning (ML) assessments, which typically took weeks, now take hours.
AI Network Optimization
With modern software and platforms, telcos must manage massive amounts of data to extract actionable insights. As such, telcos use AI technologies to optimize data management processes and draw accurate outcomes, and these technologies include
- Machine learning (ML)
- Big Data
- Multiagent systems
- The Internet of Things (IoT).
By combining these solutions, telcos can also optimize their network security, performance, quality of services, and energy consumption.
AI is a growing telecommunications trend, with a projected CAGR of 41.4% between 2022 and 2031. In 2021, the market value of AI in telecoms was $1.2 billion; in 2023, this value is projected to reach $38.8 billion.
Challenges
In contrast to these benefits, telecom companies must consider the most prominent challenges of AI—a lack of resources and team awareness. In other words, AI has a steep learning curve, and companies must hire experienced engineers and invest in the right AI technologies.
Case Study
AT&T is a prime example of an AI-powered telco, relying on technologies such as ML to optimize its customer experience. As a result, they can use in-depth analytics for accurate forecasting and planning to make customer assistance efficient and deploy employee-productivity strategies. With the help of AI, this telco could achieve the following
- 7% reduction in miles traveled for every dispatch.
- 5% increase in employee productivity.
Growth of VR Technologies
One of the primary applications of VR for telcos is to optimize team training and maintenance. VR can help these companies save money and simplify processes, such as training, software installation, and maintenance.
First, telcos will spend much less on team training as they do not need supervisors to oversee this process, nor must they invest in a large venue as VR does not have physical limitations. In addition, VR experiences ensure all trainees receive consistent information and the same level of resources—this minimizes costly mistakes from lack of or inconsistent training.
Additionally, VR enables engineers to remotely test, install and maintain software—your team does not need to be onsite to configure VR and can test applications in VR before implementing them in the real world.
Challenges
While VR provides valuable opportunities, EonReality indicates three main challenges that telecom companies face when implementing VR technology. The first is a lack of high-quality content, which most companies do not have the budget to produce. Also, creating VR content is challenging, and there is no easier way to get around this. Finally, if VR is not implemented correctly, your ROI may not justify your investment.
Although these are noteworthy challenges, let us explore an example of how a telecom company can leverage VR for successful customer service training.
Case Study
Companies in Australia’s telecom industry used VR to train their technicians for an annual safety training recertification. These employees are located worldwide, so training in a physical venue was not possible. Fortunately, VR assessments are remotely accessible, and companies could help employees without the cost of physical training (i.e., location and equipment) while delivering a consistent learning experience.
Overall, immersive training through VR achieved these outcomes
- 50% reduction in how long it typically takes employees to complete training.
- Maintained remote group training throughout COVID-19 in 2020.
- Reduced administration costs and time through automated learner progress tracking and cloud storage.
Energy-Efficient Driven Business Decisions
Based on a report by Analysys Mason, telecom companies consume 1.5 to 2% of the world’s total energy usage. Consequently, telcos are trying to reduce this consumption while responding to the increasing demand for eco-friendly products and services. Thus far, 50 global telco leaders have pledged to lessen their carbon footprint in the next decade, an increase from 19 companies since 2021.
Essentially, the goal for energy efficiency is achieving net-zero emissions, which means that telcos must strive to decrease their carbon footprint as close to zero as possible. There are many ways to achieve this, including
- Automate your management systems to reduce electricity consumption.
- Invest in electrical cars if you provide company vehicles.
- Optimize your production line for energy efficiency.
However, telecom companies must prepare for the challenges of energy efficiency strategies—we will explore this next.
Challenges
The primary challenge for energy efficiency in telcos is a lack of proper management and strategy. The US Securities and Exchange Commission (SEC) requires companies to disclose their climate-related risks, and by 2021, 50% of telcos had disclosed this information. However, in 2022, this figure fell to 46%, while 36% still do not have a net-zero strategy.
Case Study
China Mobile is the leading telco in mainland China, with the largest global network. However, adopting 5G technology caused an 8% spike in energy consumption, and China Mobile looked to Nokia’s AVA technology as a solution. Helping China Mobile reduce energy consumption, this AVA technology remotely manages passive network elements and powers them down when they are not required.
Within a few weeks, China Mobile’s energy efficiency strategy achieved the following:
- 7% reduction in energy consumption, with a 20% expected reduction in the following years.
- 74% reduction in energy consumption for air conditioning.
Introducing the Metaverse
Professionals in the tech industry believe the metaverse is the next iteration of the internet—it is a 3D virtual world that allows users to do everything in the real world without physical limitations.
For example, if you sell home security systems, you can provide a real-time demo in the metaverse. Buyers can operate the security system as if they were at home, and explore how these functions would perform in real life.
In addition, telcos can charge customers more for premium experiences and promotions in the metaverse. Not only does this help telcos increase revenue and refine their marketing and advertising strategies, but they can also improve customer engagement.
Challenges
While the metaverse offers authentic opportunities for telcos, one of the top challenges of this technology is how long and complex the infrastructure is to develop. Telecom companies must configure 5G, VR, and AI, invest in VR technologies (such as headsets and haptic gloves), and only then can they develop a presence in the metaverse. Moreover, these investments are expensive for telcos, and government agencies do not fund private companies, so securing capital may prove difficult.
Case Study
In 2021, SK Telecom in South Korea launched a metaverse platform, “Ifland”—offering VR social interaction powered by 5G connectivity. With this platform, SK Telecom achieved the following
- An increase of 1.1 million active users after five months.
- 12.8 million users after 15 months.
- 8.7 million downloads within a year.
- An average session of 61 minutes per user, every day.
In Closing
In this article, we covered the top telecommunications industry trends in 2023—5G technology, cloud software, AI, VR, the metaverse, and energy-efficient strategies. Telcos must adopt these trends to stay ahead of the competition and optimize their network infrastructures through modern technologies. Although these trends have their respective challenges, the advantages could far outweigh these setbacks, provided telcos correctly implement these solutions.
