When we sat down twelve months ago - and for those of us in the UK, two lockdowns ago - to forecast the direction of the telecoms market in 2020, my guess is that none of us saw what was about to happen next; the Coronavirus pandemic.
While there may be a little more certainty about what lies ahead next year, the likelihood is that COVID-19 will continue to dominate the commercial landscape for some time yet and, even when ‘normal’ returns, it won’t be the old normal that comes back. So, making 2021 predictions is a little more challenging than usual and requires a degree of epidemiological nous as well as communications industry insight.
With all that said (I’m told there’s value in getting your excuses in first), let’s dust off the crystal ball and hazard a guess at where 2021 is likely to take us. Headline prediction: It’s not going to be short of opportunities. Headline two: As ever, fortune favours the brave.
First, some high-level trends we here at Evolving Systems think will underly market activity next year.
The no risk/low risk prediction is that 5G will continue to roll out with customers hopefully (underlined) benefitting from more reliable high speed Internet access, while the operators increase their bandwidth capacity thus allowing them to target new subscriber growth via new services or by taking a bigger share of the marketplace. It’s axiomatic that every operator cannot grab an increased share of any marketplace so there will be winners and losers. Put another way, gearing up now to leverage the incoming 5G commercial opportunity will be table stakes for the future winners. Surprisingly perhaps, for the forward-thinkers 2021 may be a year of infrastructure investment.
CSPs will build on their efforts to go beyond connectivity. In mature markets connectivity is becoming fully commoditised (if it isn’t already) and regarded as an invisible on-tap experience. So, where’s the next opportunity? We think consumer IoT could open up new revenue streams.
A predictable prediction: Expect increasing focus and determination to capitalise on customer trust. There is an ongoing battle for data intimacy which is yet to be won, and the winners will be in position to untap many different plays ranging from digital ID to optimised operations.
An even more predictable prediction: Get ready for still newer ways to capitalise on customer data. AI offers one opportunity for a quantum leap in customer experience enhancement by utilising the data to improve targeting and personalisation; indeed the industry will trend about moves towards achieving the right offer, right moment, right customer and right channel thanks to an integrated customer view.
And finally, a developed partnership ecosystem solidifies/emerges in 2021. Data captured through artificial intelligence is a high stakes game. Coalitions can be an effective way to outplay limited access to external data and accelerate the virtuous data cycle.
Expect content monetization to drive alternative revenue streams. The trend towards commoditisation of connectivity leaves video as the main element of differentiation, fuelled by AI-driven customisation. Growth of video streamingwill continue to explode - think ‘reaggregation’ (or re-bundling) of streaming, offering an approach pioneered by players like Amazon and Roku. Service providers have an opportunity to offer highly customised packages of content that, in addition to video, could include streaming of music and games, as well as the option for customers to accept ad-supported video; advertising in exchange for ‘free’ (non-subscription) content. Ad-supported video has already become the dominant model of delivering streaming video to consumers in China, India, and throughout the Asia-Pacific region. Sometimes it combined with subscription services; in other cases, revenue comes from ads alone. Ads also provide much-needed revenue for streaming providers that seek to expand into different services, such as gaming and music.
We’ll see the development of the next generation of use cases based on 5G. We think foremost among these will be those related to video surveillance and analytics, Fixed Wireless Access, immersive experiences such as smart stadiums, eHealth services, machine remote control, Cloud robotics and process automation, and connected vehicles. Watch these areas…
Unlimited data plans to attract and retain customers will boom. With 5G coming into the picture, service providers will be able to increase both download speeds and monthly data capacity on unlimited plans.
Expect to see the emergence of AR/VR in a wide range of enterprise apps - particularly in situations where users don’t have access to the processing power of a PC. In the world of media & entertainment, AR/VR solutions will likely (among other use cases) be used to provide a highly interactive alternative to traditional gaming controllers and keyboards, help companies produce educational programmes that provide information in a more interesting manner, supplement other tools for training new employees on day-to-day tasks. Such solutions offer an immersive theatre experience by allowing the audience to get involved in the action, improve visitors’ experiences at museums, art galleries, and amusement/theme parks, and make concert performances even more memorable.
A new trend in marketing becomes mainstream. Conversational marketing moves beyond the simple chatbot and simple inbound and outbound communication is replaced by a new approach: Interactive, conversational marketing.
The pandemic has changed consumer sentiment with the result that people are adopting digital habits more rapidly than before and also trying new products/services/etc. as a result. Necessity (and lockdown) have been the mothers of invention which translates to new opportunities to connect with segments that brands previously couldn’t reach. With that said, other players are going to reach your consumers too so CSPs will need to work harder on their loyalty progammes than ever before.
Predictions? We could go on! But let’s end with two fundamental thoughts; predictions that may underpin success in 2021.
First, speed will be the key. Quick reaction will be vital. Success will depend on how quickly and how well CSPs harness technology to build the platforms that differentiate their business and help their people do their best work. Like we said earlier, the time to invest in what happens next is now.
Second, customer experience lies at the heart of 2020. As digital is increasing, customers have a better chance to compare services and hence become to be more demanding. All aspects of life will be affected from banking to dining to communications. The customer journey will matter, more than it ever has before. And the CSPs who get customer journey right will drive double-digit growth in 2021.
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