The telecom industry is in transition as it embraces cloud adoption, contends with an explosion of data — and how to wrangle it — and ever-increasing network and capability demands from consumers and business partners alike.
And while the first quarter of 2023 may already be over, there’s still much to evolve in the year ahead (and beyond).
SDxCentral recently spoke with Anand Swaminathan, EVP and global industry leader for communications, media and technology group at Infosys, who offered his expertise on where the industry is at, where it’s headed, and the challenges and opportunities ahead.
Telecom in transition: Inside the industryThere’s no question that the cloud is transforming the telecommunications industry.
According to Grand View Research, the global telecom cloud market size will reach $103.6 billion by 2030, representing a compound annual growth rate (CAGR) of nearly 20%. Similarly, Market Research Future puts the market at $115.6 billion by 2030, representing a CAGR of 19.2%.
Industry giants including Google, AWS, Microsoft, Red Hat, VMWare and others have already staked claims in the telecom space.
Demand is being driven by a number of factors — from rapidly increasing device use across the globe, to exponentially expanding media content (and the expectation it be crisp and glitch-free), to the rise of IoT, edge computing and 5G.
“The digital economy is evolving, and an unparalleled level of disruption has made it a priority for telecom companies to level up,” said Swaminathan.
Benefits of cloud for telcosAccording to Swaminathan and other industry experts, the benefits of the cloud are numerous and diverse. Notably, it can help control and reduce operating expenditure (opex) and capital expenditure (capex). A PwC survey found that telecoms operations could be wasting 20% — or $65 billion — in capex a year.
Also, the cloud can make it simpler to collaborate with business service partners and retain customers, as operators can quickly alter business models to test goods, services and pricing schemes to remain competitive. It also allows better service resilience and the capacity to respond swiftly to changes in demand.
Swaminathan pointed out that the cloud can bring enterprises to market faster, thus allowing them to access new revenue streams and grow profits. Cloud platforms provide applications for business to scale through adaptors and plug-ins to connect with multiple enterprise tools and better manage IT operations.
“Their foundation provides industry-grade open-source technologies to keep pace with shifts in technology and can implement at nearly twice the pace of existing solutions,” he said.
Security, network complexity, consistency the greatest hurdlesStill, there have been many well-documented challenges related to telecom in transition.
Besides the sheer scale of the transition, there are security and privacy concerns, and some cite flawed approaches to deployment.
Providers want to be sure they are offering the bandwidth, always-on connectivity, and mobility that customers need, said Swaminathan. Also, supporting public services with their connectivity needs underpins a variety of systems like transportation, utilities and healthcare systems.
“The industry can appear slower than others due to unprecedented disruption, processes and systems becoming increasingly complex,” he said.
Also, organizations must continue to evolve partnerships to protect the value and opportunity they are delivering to customers, he said.
However, after years on the cusp of transition, “transformation is possible now due to the shift in the telecom industry from being communication service providers (CSPs) to ecosystem orchestrators,” Swaminathan said.
Multicloud the preferred optionAddressing telecom in transition, most providers have shifted towards a multicloud approach, Swaminathan pointed out.
“Since data is distributed across different environments, cross-cloud analytics is important to have,” he said.
This helps to improve data management efficiency across multiple platforms, thus reducing the overhead of switching from one infrastructure to another to pursue data or resources.
Other companies do choose private cloud options, he said, as these offer greater control and lower costs versus the public cloud. However, private cloud doesn’t always offer the wider services of public cloud; it can also have higher capital expense.
Ultimately, Swaminathan said, “telecom companies face many dynamic challenges in today’s market and organizations should adopt a strategy around a ‘renew-new’ that simultaneously revamps existing tools and processes and adds new complementary ones to become future-ready.”
The promise of 5G — and other trends5G is all the talk in telecom.
As Swaminathan put it, “5G is transforming the way we live and work through new services and use cases.”
Still, it can only be fully realized when providers help product owners conceptualize new offerings and enable architects and consultants to adopt a product and service modeling approach, he said.
Going forward, the focus will be on disruptive business models, which will create new products, services and customer experiences.
However, Swaminathan emphasized, continuing to release innovative products and services requires a flexible and reusable product design that has a framework up to industry standards to provide an overarching view between networks.
Also, when creating an experiential service offering, businesses have to ensure that their operational processes are aligned with enterprise business strategy, he said. An approach that is highly automated to provisioning and activation will differentiate in terms of service and experience.
Just as critically, the need to adopt the vision of ‘AI first’ and the drive to maximize B2B market potential have created new levels of skill — yet the talent and subject matter expertise gap remain.
Therefore, “investing in talent is the next stage for a competitive advantage,” Swaminathan said.
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