The Telecom, Media & Technology (TMT) Industry as a whole is at an inflection point that is perhaps more significant that any other junction in North American history. The pace of disruption is at unprecedented levels, “Winner takes all” is becoming the norm and the status quo is being challenged across the board. To help address the challenges and provide guidance on growth opportunities, my team has put together a list of the top 10 predictions for the next 12 months.
Top 10 TMT Predictions for 2017:
Operators & OEM’s begin to rethink IoT Monetizing Strategy
The euphoria around the “Promise of IoT” is subsiding, network operators globally are finding themselves under increased pressure & scrutiny to start materializing the returns on the investment. Some operators have invested billions in creating critical mass for specific solutions or creating tools for developers to leverage. Though the consumer is more excited about the wearables and smart home products- we will find continued momentum to invest in the Industrial IoT space (IIoT), connected vehicles, fleets and smart cities. Every car manufacturer will have a connected vehicle and or/autonomous driving story; however, the road is bumpy and will need fundamental shift in the ingrained product and development philosophy to truly unlock the economic potential of Internet of Things.
- Mainstream Apps powered by Cognitive Technologies start penetrating our day to day lives (AI, ML, NLP, Bots, Voice operated UX)
In an attempt to add value and differentiate from competition, we will see more and more companies adopt cognitive technologies, to bring magical experiences to life. AI, ML and other forms of cognitive technologies will become more widely available and accepted. Voice will begin to become the defacto standard of interacting with connected devices, providing new user experiences and opportunities for Tech companies to be seamlessly ingrained into their customer’s lives.
3. Big Data continues to unlock Big Value
Scramble for Big Data Scientists intensifies as enterprises and SMBs across all industries alike get bit by the bug. As the “personal data economy “continues to explode new business models & products will continue to be unleashed largely thanks to insights and trends uncovered from Big Data Lakes. However, there will also be a lot of hand waiving from so called experts, and enterprises will have to careful with their investments. The current rule of thumb being used at start-ups; pegs the economic value of every big data scientists to their overall valuation by an incremental $5MN. These numbers, will only continue to increase for the next 6-12 months.
- VR/AR the next application & content frontier
Augmented & Virtual Reality investments reached a record high in 2016, and so has the excitement. In an attempt to engage the customer more effectively, companies have started to invest heavily in creating immersive experiences- primarily lead by the big 4 (Apple, Facebook, Google, Microsoft) by truly leveraging AR/VR. We forecast that by 2021 at least 1 billion people will have constant access to AR/VR content and devices , with the majority of the market cornered by Gaming, Mobile/Hardware OEM’s & Social Network providers.
5. Pendulum swings decisively towards SDN, Virtualization & Small Cells
With the growing tsunami of data usage and number of connected devices per capita, some Tier 1 network operators will continue pushing the envelope on SDN and NFV. Despite the challenges with Network and Service orchestration they will ensure continued investment from the vendor community to rapidly evolve this new architectural approach. In the next 12-18 months, we will find the organizational resistance across the Tier 2’s also waning as the pendulum swings materially in favor of redistribution of legacy infrastructure capex towards “Open and Programmable” SDNs. On the back of it, the idea of Network as a Service (NaaS) i.e. the ability to procure and scale bandwidth on demand, will begin to gain momentum with enterprises.
From a radio perspective, in an attempt to offload mobile traffic from macro networks and augment capacity we will see continued investment in small cells. We forecast roughly 250-300% increase in small cell in 2017, subsequently breaching the 1MN global deployment number by 2021.
- LPWAN will continue to generate interest in the Short-term
Since 2015 there’s been tremendous excitement around launches of new proprietary networks specifically being built for IoT- Sigfox, LoRA, Ingenu amongst others. The promise of ultra narrow band, low energy consuming, low cost radio communication network has seen hundreds of millions of dollars been pumped into the ecosystem. However, with 3GPP finally recovering from their miss and beginning to roll out standards for NB-IoT; we will start witnessing the beginning of the end for some of these solutions within the next 2-3 years.
- eSIMs begins to gain traction
The concept of a programmable SIM is not a new one, however we will begin to witness less reticence from operators to implement them, namely for connected devices. From wearables to connected cars, it will help OEM’s to rollout consumer connected devices seamlessly across the globe. The local operator’s profile will be dynamically downloaded on the embedded SIM, ensuring connectivity at local rates, making the business case plausible. As a result of strong growth of IoT Devices and development of eSIM specifications by the GSMA – the growth of eSIMs will start to materially outpace traditional SIM cards by a factor of 7-10x over the next 5 years.
- 5G Trail blazers
Unlike the previous rollout of incremental mobile technologies, the move from 4G to 5G is not going to be a single step but rather a multitude of sustained upgrades over the next few years. This year, we expect some operators to have a few of the foundational building blocks already in place, for their key markets. The lack of standards and availability of any 5G handset, would peg a wide scale launch of 5G only in the next decade. However, we anticipate at least 150 operators to launch the interim bridge to 5G, called LTE A or LTE A Pro, this year.
- IoT accentuates cybersecurity vulnerabilities
Connected devices will continue to pose serious security challenges to businesses and the web worldwide. We estimate 70% of current IoT products are vulnerable to known security threats, and despite that little will be done to address themve. We expect a large scale security breach resulting in damage to atleast one multi-national brand and (possibly) even loss of life, within the next 12-24 months. This will lead to increased regulatory scrutiny and mandate to invest in stringent security standards and certification.
- Constant Tech Disruption becomes the Norm
The last decade has seen an unprecedented number of unicorns take life, as they leverage mobile as a tech platform and a captive audience of 2 Billion people using smartphones, globally. With continued investment from the VC and Tech industry alike combined with a pro business US government we expect the trend to continue. To compete more effectively, we will see Telcos change and evolve. Case in point, embracing OTT content and along with MSO’s & Video Service Providers invest in original video content. Similarly, in the banking sector we will find core financial services evolve at break neck speed as legacy institutions embrace change through the Fintech revolution. Using new technologies such as Blockchain, Big Data, Biometric solutions, Mobile and Cloud will be used as the core anchors of the change and evolution.