Year 2020 was extremely volatile for many industries including telecommunications. We at Netradar have been working with leading telecom operators, regulators, and technology providers to provide them solutions for capturing critical data on network performance as seen by the users to improve on the services based on the data collected. In this article we give some predictions about what trends will impact the telecommunications industry during the year of 2021 and how companies can emerge as a winner post pandemic.
1. Telecommunication industry will recover from the pandemic
The recent article by GSMA Intelligence suggested the mobile industry has suffered less financial impact due to Covid-19 than the broader economy, despite inevitable hits to revenue from roaming, handset upgrades and the enterprise sector. While the performance was worse than technology and internet groups (Facebook and Google) the mobile industry performed much better than retail, travel, and hospitality industries.
Pandemic has caused fundamental changes in user traffic patterns — both where and when the usage takes place. This has put tremendous pressure on telecom operators to understand how the usage patterns have changed and how to update connectivity solutions to match these changing needs.
Harvard Business Review article “Adapt Your Business to the New Reality” (Sep-Oct 2020) introduces a systematic approach for addressing these changes by categorizing trends into a matrix with two dimensions on temporary/structural and existing/new trends. According to HBR, 14% of the companies in the past four downturns have increased their financial performance by leveraging on these changes.
The fact is clear — there is a need for ubiquitous connectivity although usage patterns have changed. Netradar hybrid measurement technology enables telecom operators to take concrete and decisive actions resulting in more effective network planning and optimization, faster troubleshooting and better targeting of network investments.
2. 5G will hit the masses
According to GSMA Intelligence 30% of total data traffic in South Korea is being routed over 5G networks and the pace has nearly doubled within one year. Furthermore, Ericsson Mobility Report (Nov 2020) claims that by the end of 2020 over 1 billion people, or 15% of the world’s population, will live in 5G coverage areas and the number of 5G subscriptions at the end of the year is forecasted to be 220 million.
5G will provide the much-needed help in building network capacity but this obviously is largely dependent on the availability of mid-tier 5G devices and reasonably affordable operator 5G pricing plans.
At the technology front there will be a gradual update from 5G non-standalone networks (providing transition from existing 4G-LTE to 5G) to 5G standalone access networks. Most likely beneficiaries of 5G standalone access networks are selected industries leveraging advanced network-slicing functionality or use cases requiring ultra-low latency. Both versions of 5G are likely to co-exist for a long time.
Capturing 5G user performance data is critical for telecom operators to verify 5G speeds, to identify 4G congestion, to analyze in-building coverage and to optimize their 5G network. Legacy crowdsourcing technologies do not simply work well with (initially) low numbers of 5G users. However, Netradar samples 1000x more effectively than these legacy providers.
2. 5G will hit the masses
Recently we have seen operators in many markets launching flat rate data plans.
Change from volume-based data plans to flat rate-based plans will have fundamental implications. Obviously, the amount of cellular traffic will increase as consumers do not need any more to be that wary of their app usage or to consider offloading their cellular traffic to Wi-Fi networks. This will in turn require operators to be increasingly more cost efficient in building capacity solutions where they are needed.
Netradar provides our customers a solution which enables them to capture data how consumers’ usage patterns shift from Wi-Fi to cellular networks and how much of the user total data traffic goes through telecom operator own networks. All of this leading into actionable insights for improving the services as the usage patterns change.
4. Increasing reliance on multiple vendors
In December 2020, Nokia gave an update on its strategy and operating model stating the following: “Customers are using a best-of-breed approach to build these networks, selecting network elements from multiple individual vendors who are able to offer the best performance per total cost of ownership.” This is a fundamental shift from Nokia’s previous strategy of being a one-stop-shop for telecommunication providers.
Also, in December 2020, we saw a major outage of Google services for about an hour, sending many of its most popular services offline.
It is likely that consumers, corporations, regulators, and lawmakers will through their actions ensure that no single telecom vendor or technology company will take too dominant a position in the market.
Having said that, it is worth noting that the telecom market is regulated with multiple companies providing their services for consumers and corporations in a single market. Therefore, it is essential that telecom operators can measure how well they serve their customers with absolute terms and in relation to their competitors. Ericsson Consumer Lab report (2018) claims that consumers will pay on average 17% more if they perceive their telecom operator’s network performance to be the best in the market.
The obvious question if you are a telecom operator is:
“How can I emerge as a winner post pandemic?”
1. By focusing on your customer
Telecom operators need to understand from the customer’s point of view what are the fundamental changes in demand patterns before addressing them. They need to build a detailed heatmap with geolocated usage information highlighting potential customer experience issues.
Network based measurements give a rough estimate where the usage takes place but typically more accurate location needs to be captured to ensure that actions to improve connectivity are correct. Furthermore, as multiple connectivity methods (cellular, WiFi) are in use, the overall picture needs to cover all of these.
Collecting massive speed data is essential for targeting network investments and validating performance. Netradar enables telecom operators to capture 1000x more speed data than any other crowdsourcing technology with actionable insights not available from anybody else.
2. By focusing on network usage and consumer experience
Maximum download speeds or signal strength alone do not explain a good or bad mobile experience. Instead, telecom operators must understand where and when user speeds are limited due to network congestion. Netradar’s unique network congestion detection pinpoints where and when network capacity constraints impact users by limiting their download/upload speeds.
Should a consumer only get 10Mbps throughput, telecoms operators need to identify if the network is congested or if the user is in a bad radio environment. Are cloud services at fault, or is it a particular mobile phone model, operating system — or even just a single device the limiting factor — or is the speed normal for this particular app?
3. By focusing on the actions to improve customer satisfaction
For many telecom operators, the scenario is very much known — raw data pours in from multiple sources and they are overwhelmed with limited resources to process all of this, let alone to produce actionable insights which drive improvements. Increasingly, telecoms operators are using AI based tools to identify network anomalies or angles where they can improve customer experience and satisfaction.
To start off, indoor performance is critical for telecom operators. The higher frequencies (4G and 5G) create challenges for radio network planning. Operators need detailed indoor performance data to improve. Netradar delivers massive performance data, mapped to 5-level of indoor zones depending on where the usage takes place — not available from any other provider. This enables operators to identify root causes and take the best corrective action.