Enterprising approaches to 5G are reinventing telecommunications
- The telecoms industry is changing rapidly with the advent of enterprise 5G. Oracle's Matt Beal shares examples of operators leading the change to find data 'direction'.
Despite significant capital investments in new technologies made by operators over the last few decades, most of the value created in the telecoms industry in recent years has been captured by so-called over-the-top players — those providing the networks and applications for web content and streaming services.
Exploring new ways to ignite growth, many operators are now looking beyond traditional connectivity businesses and reinventing themselves as providers of B2B technology services. In fact, GSMA estimates that, on average, operators now account for up to 30% of their revenue from business services, which has increased by 5% in the past five years.
This shift is reshaping the telecoms industry as we know it. One of its biggest drivers is the advent of 5G, which introduces software-defined networks which can support a much wider range of business applications than previous generations of network technology. 5G offers carriers opportunities to expand their core connectivity business — think connected cars or smart factories — but also a springboard to develop new services in areas adjacent to connectivity such as cloud computing, cybersecurity, and AI. This opens a host of new opportunities for operators in the wider technology services market that support business digitalization.
Launching enterprise cloud services
The telecoms shift to B2B is well underway, based on a few key signals. Firstly, in the last few years many of the world’s largest telecoms operators have moved into the managed cloud services market, which IDC projects will grow at around 16% a year to a $178.8 billion market by 2026.
Among the most ambitious operators taking this step is India’s Bharti Airtel, the world’s third largest wireless carrier. It recently partnered with Oracle to jointly offer cloud services to Indian enterprises, and its Airtel Cloud offering includes integration and security services tailored for vertical industry customers. Similarly, Spanish operator Telefonica is working with Oracle to co-sell cloud services to businesses. This has become a popular trend among many other large carriers who are capitalizing on the benefits that cloud migration and integration services for enterprises can offer their businesses.
The push into B2B services is bringing fundamental changes to how service providers operate and do business. For example, operators are entering new partner based B2B business models with vertical industry companies and technology vendors that can offer vertical industry expertise.
The advent of 5G is also starting to drive cross-industry collaborations as operators assess how 5G’s unique attributes — high speeds, low latency, device density — can be applied to specific industry environments. It’s conceivable that soon we will see partnerships emerge between operators and, say, cloud gaming companies to offer ultra-low-latency ‘pay-as-you-game’ packages for gamers, or Premier League football clubs to offer customized 5G VR experiences to fans.
For these and other reasons, the Oracle Industry Lab was launched last year outside of Chicago as an incubator and testing ground where customers, prospects, and partners can explore solutions that bring 5G and other transformative technologies to life.
At the lab, powered by Verizon 5G Ultra-Wideband, participants can experiment with how cloud native communications technologies are enabling automation and scaling to meet expected growth in 5G subscribers, connected devices, and demand for rapid service innovation. They can also explore how service providers can partner with other industries to address challenges and co-create B2B2X (business-to-business-to-X) offers and business models. Similar Oracle industry-focused labs are set to open in Australia and the UK this year.
Finding data ‘direction’
As networks are deployed and the IT environment grows increasingly complex, many CSPs are faced with challenges in securely accessing the 5G data and sharing it with the necessary third-party applications without compromising operational practices. With systems that were previously used for 3G and 4G networks unable to perform with 5G’s cloud native service-based architecture or meet 5G’s more stringent security requirements, data engineers and data scientists need new resources to access network data, share it in a secure and simplified way, and, in turn, drive company-wide objectives.
At Mobile World Congress this week, Oracle will be discussing the second application in our Network Analytics portfolio — the Oracle Network Analytics Data Director — to enable operators to flexibly integrate their 5G core into their existing operational tools, even for network functions that are not provided by Oracle. In designing Data Director, we embraced cloud-native principles for accessing data in a secured 5G network environment. This makes it the ideal solution for those who have already adopted next-generation analytics frameworks and for those who still rely on traditional operational tools and platforms.
The telecommunications landscape is evolving rapidly with the advent of enterprise 5G. The operators who are leading the market have been able to monetize this opportunity by embracing cloud-based solutions for the rapid agility and scalability that 5G demands. In the next few years, the B2B market will emphatically separate operators who are getting it right with the cloud, smart partnerships, and network analytics, and those that will be struggling to keep pace digitally.