Massive Transformation of Core Networks to Take Lead in 2017; Millennials to Drive Further Demand for CSPs' Services

Massive Transformation of Core Networks to Take Lead in 2017; Millennials to Drive Further Demand for CSPs' Services Image Credit: Alepo

New Year is that time of the year where we look at the past and look forward to new beginnings. If 2016 is any indication of what’s in store for 2017, it’s going to be an amazing time for the telecommunications industry. Our main prediction is that communication service providers will be looking to finding more avenues for revenue generation through new data monetization strategies. In 2017, the Internet of Things will also act as a key driver of transformation wherein more and more industries will become a part of this IoT landscape. So, here are our five predictions that we think will shape the year 2017. Our predictions' examine the forces that will impact the CSPs business agenda in the coming year.

#1: MILLENNIALS WILL DRIVE COMMUNICATION SERVICE PROVIDERS TO BECOME DIGITAL SERVICE PROVIDERS

A driving force behind today’s mobile data market are Millennials. Today’s coming-of-age consumers (18 – 34 year olds) are digital natives, mobile first, and desire a seamless experience with a flexibility to consume services anytime, anywhere. In some markets, Millennials make up the overwhelming majority of mobile subscriptions. What’s more, Millennials are mobile app hungry. In the U.S., they spend, on average, 90 hours per month using mobile apps, mainly video streaming (e.g., YouTube, Netflix), social (e.g., SnapChat, Instagram), music streaming (e.g., Pandora, Spotify), and messaging (e.g., Viber, Facebook).

Therefore, CSPs need to offer differentiated services in real-time to these Millennials in-order to satisfy their demands and give them a rich customer experience. This will not only give CSPs the competitive edge but also help them to become a Digital Service Providers (DSPs). As a DSP service providers are creating offers that are tailored to meet the lifestyle of their digital subscribers by deriving meaning from each customer interaction. Today, CSPs are offering on-demand, personalized services to their digital subscribers and this phenomenon will only increase in the new year with more and more CSPs becoming a DSP in-order to meet the changing demands of the subscribers.

#2: POLICY AND CHARGING CONTROL (PCC) WILL DRIVE BUSINESS INNOVATION AND REVENUE

The ability to monetize data services and to bring new offers to the market without hesitation is dependent on the capabilities of a CSP’s policy and charging control. As service providers look forward to becoming successful digital service providers, the role of the PCC as a profit and service innovation center will continue to grow.

We see policy control moving from simply serving as a bandwidth traffic manager to encompassing much

Derrick Gross,
VP of Business Development,
Alepo Technologies

more of the service providers’ revenues and the customer experience. We see an increase in demand for granular charging of apps and content, as well as more segmented and lifestyle-based plans and promotions. Definitely, the lines between policy, charging, and CRM are increasingly blurred in terms of functionality and roles within the network, with operators thinking more in terms of end-to-end experiences and revenue streams.

As new revenue models and business values are defined, and service providers look to launch and monetize new services like VoLTE, over-the-top applications, and international data roaming they will begin to employ multiple PCC solutions, rather than rely on a single solution that can support all use cases, present and future.

#3: DEVELOPING MARKETS WILL BENEFIT FROM LEANER, FASTER LTE DEPLOYMENTS WHILE 5G TRIALS WILL GO ON IN FULL SWING

With LTE proliferation around the world, users are demanding modern digital services, more data, and faster network connectivity. In 2017, CSPs and technology providers will continue to see a steady pace of LTE rollouts in developing markets throughout Asia, the Middle East, and Africa. With maturation of LTE technologies, proven and tested solutions, and considerable interoperability testing already completed by the leading technology providers, we’ll see end-to-end LTE deployments completed in a matter of weeks, not months, and in much more cost-effective and reliable way.

While the developing markets will be looking forward to LTE deployments, 5G trials will be in full swing for the mature markets during the new year. AT&T and Verizon are all geared up for 5G trials in 2017. Meanwhile, Sprint and T-Mobile are also in the queue for 5G testing. Qualcomm Technologies, Ericsson, and South Korea’s SK Telecom have also announced their plans to conduct interoperability testing and over-the-air field trials based on 5G New Radio (NR) standards. The interoperability tests and trials are expected to be conducted in the second half of 2017. So, though 2017 will not see the proliferation of 5G in its full glory, it will definitely be something every CSP has its eye on.

#4: WI-FI USE WILL CONTINUE TO BOOM AND GROW IN RELEVANCE

In light of the exponential growth driven by the Internet of Things, cloud managed Wi-Fi, and other trends, Wi-Fi use will continue to boom. The technology will establish itself not only as a crucial part of connectivity in the home and the workplace but in in public spaces too. According to IHS research, by 2020, the worldwide carrier Wi-Fi market is forecast to reach US$1.5 billion. With Wi-Fi becoming more like the mobile cellular experience with Hotspot 2.0, the Wi-Fi market is only expected to grow.

#5: LEGACY SYSTEMS WILL GIVE WAY TO NEW AGILE SYSTEMS

In recent years, the rapid development of digital services and the growing threat from OTT players has forced CSPs to rethink their BSS architectures. For CSPs, agility has become a key business driver. The ability to react to market demands in real-time is a necessity. To manage and deliver these ever-increasing customer demands and provide the best customer experience, CSPs have to consider a BSS transformation. With the adoption of new BSS architecture CSPs become more agile that enables CSPs to launch innovative mobile offers and service bundles - faster than ever! What’s more, with BSS transformation, CSPs are able to combine together multiple communication services: voice, data, content, VAS; across any access technology: 3G, LTE, WiFi, xDSL, FTTx, WiMAX; in a single, truly convergent BSS environment. This affords multiple benefits to CSPs, including reduced complexity and operational costs, the ability to create bundled services, cross-sell, and up-sell promotions.

Thus, in 2017, service providers will massively transform their core networks – specifically their policy and charging core and BSS framework - in order to gain higher performance, advanced features and security, and to support growth in subscriber numbers. Many of these deployments will be partially or fully virtualized.

About The Author:
Derrick Gross is currently the VP of Business Development & Marketing at Alepo, in charge of partnerships, operations, and customer relations. He has experience leading BSS/OSS projects in LTE networks for Alepo's customers around the world, including the definition and delivery of core policy, charging, and control elements. Derrick has experience in the software industry, previously in roles spanning product management, sales, and marketing in new media startups and AOL, where he launched advertising and promotional products. He holds a Bachelor of Science in Finance and International Business from New York University.

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