2019 will be a year of change for mobile operators. The implications of 5G are set to transform the entire industry, of course, but despite it dominating discussions around telecoms in recent months, it is not the only the topic worth considering. The impact of recent technological advancements such as AI will be felt over the next 12 months, for example, and operators will - by necessity - continue exploring new revenue streams in the face of strong competition. Here, then, are some of my thoughts on what lies ahead.
#1: AI starts proving its worth
2018 saw a great deal of future-gazing and hyperbole around the potential of AI in the telecoms industry. As we see time and time again, however, the coming year will see the hype giving way to a more pragmatic approach. Indeed, most operators already have some relatively minor implementations of AI somewhere on their networks, and some use cases have started to emerge as front-runners.
We predict that operators will coalesce around a handful of use cases in which AI has already proven its value through simplifying network management, cutting costs, or adding to their bottom line. The hype and hyperbole are likely to continue throughout 2019, of course, but we believe the smart money will go on AI applications focused internally on service assurance and service fulfillment, as well as on subscriber-focused chatbots and salesbots.
#2: The OTT fight back begins
Albrecht von der Recke,
COO & Founder,
Operators’ traditional voice and data revenues have been eroded by the growing power of OTT players for a number of years now. During this time, there has been very little in the way of a ‘fight back’ from operators in response to this long-running threat, either individually or as a group. In fact, the closest we’ve seen has been T-Mobile USA’s Binge On package, and that only ‘fought back’ by joining forces with OTTs, and gaining revenues through clever marketing, billing and increased optimization.
Today, however, we’re starting to see a different kind of response. Swapp, for example, is a virtual second line offering, recently made available to all Portuguese mobile users. MEO Portugal, the operator behind it, used its own mobile network infrastructure, packaged up in an OTT-style, using iOS and Android apps, and supported with smart, glossy consumer marketing. In doing so, it successfully created a high-quality network service that OTTs are simply unable to, while borrowing the lessons of OTT marketing and distribution.
Now that the OTT playbook is more widely understood and repeatable, we can reasonably expect to see more initiatives like this in 2019 and beyond.
#3: Personalization will drive 5G monetization
2019 will be the year when 5G finally becomes a reality, with the launch of at least 30 live, commercial 5G networks expected by the end of the year. Despite the technological advances of 5G, however, billing is likely to take the form of faithful tiered services and maybe some experimentation with all-you-can-eat voice and data plans. It’s unlikely there’ll be any billing innovations in the consumer market, certainly in the short term.
Clawing back revenues from network rollouts will require operators to replicate an extension of what has already worked for them in 4G. Big data analytics can be used to better understand the digital customer journey, for example, while AI can be employed to analyze opportunities in real-time, with sales automation providing contextually-relevant offers, also in real-time.
This smart aggregation of technologies will enable operators to put in place a long-term strategy for monetization, and think beyond the initial ‘5G race’ in their market to generating long-term, repeatable and sustainable 5G revenues from the consumer market.
#4: Operators in emerging markets will embrace mobile wallets
Governments in emerging markets have been investing heavily in updating their financial infrastructures, encouraging a move away from cash-only societies. At the same time, consumers, always willing to try out any new technology that promises to make their lives easier, have been quick to embrace alternative payment methods. Visa-backed YellowPepper, for example, has played a major part in making Colombia one of the frontrunners in mobile wallet usage worldwide.
Operators are now beginning to wake up to the need for a range of payment solutions for their own products if they are to satisfy their customers and deliver a positive user experience. We therefore expect to see more operators in emerging markets building multiple payment options into their payment software solutions during 2019, from debit and credit cards to mobile wallets.
For some time now, operators have been facing growing pressure to find new ways of generating revenue in an increasingly competitive marketplace. With a change in mindset, combined with recent advances in technology, 2019 may be the year that their fortunes change.