#MWC2018: Spotlight shines on 5G, IoT and AR

Hard to predict what will ‘turn around the fate’ of telecom operators, but there is potential for those who can play the role of enabling platform for new digital services and players, as well as for new features and capabilities across traditional industries, says Luis Cirne, partner, communications, media and technology (CMT) practice at Oliver Wyman
M2M/IoT is becoming the preferred growth avenue for telecom operators, says Luis Cirne.
M2M/IoT is becoming the preferred growth avenue for telecom operators, says Luis Cirne.


CommsMEA: What in your opinion would be the main highlights at MWC 2018?

As always there will be a long list of topics, but there should be a good level of excitement around 5G, Machine to Machine / Internet of Things and Augmented Reality.

On 5G, it will be interesting to see what use cases vendors and operators will showcase based on the different ‘5G’ tests and trials across the globe. While we are still a few years away from commercial deployments (with more bullish operators pointing to 2021/2022 as target commercial launch dates), a number of trials have been conducted – with special mention to China’s case – and we are curious to see what propositions vendors and operators have been able to develop leveraging 1Gbps speeds and/or 5ms latency.

M2M/IoT is becoming the preferred growth avenue for telecom operators. More and more projects are being implemented leveraging IoT and it is becoming a relevant revenue stream for leading operators – as well as a cost and efficiency driver for multiple industries. As such it will be important for vendors and operators to showcase their capabilities in this space.

Augmented Reality has become a hotbed of excitement, with multiple consumer and enterprise applications being thought of.

When combined with IoT, AR can and will have a profound impact on our daily lives. Think your phone superimposing the items you need to buy on a supermarket isle, or showing you the price of available property along the street you are walking on.

We expect a plethora of use cases across the enterprise space (medical, manufacturing, educational, etc.).

CommsMEA: What are going to be non-highlights?

I would venture foldable screen devices, connected cars, and VR. While all of these show tremendous promise, the hype has surpassed what the market has been able to deliver so far, so I wouldn’t expect any of the three to steal the headlines at MWC this year – even though some of them are my personal favourites! More to come on these in the next few years, hopefully.

CommsMEA: With the first 5G NR spec out, how do you expect the operators and mobile tech companies plan their strategies around that this year?

Given 5G’s requirements for higher density of cells and fibre reach, we expect most operators to increasingly consider infrastructure sharing and access to fibre networks as key long-term success factors. As such, there should be additional consolidation of mobile and fixed network operators; a continuation of moves towards passive asset sharing and here and there the setting up of new small cell operators; regulatory strategies and pressure to liberalise or equalise access to existing fixed networks and in particular fibre.

For those keen on exploring the complete value chain of IoT which 5G will enable, we would expect a focus on building up competent enterprise solutions capabilities. This is, naturally, on top of the ‘digital transformation’ type of programmes, which go without saying, are now more of a hygienic factor than a differentiator.

CommsMEA: We hear of several buzzwords in the technology domain from time to time- however, which do you believe would actually prove very beneficial for turning around the fate of telecom operators?

Hard to predict what will ‘turn around the fate’ of telecom operators, but there is potential for those who can play the role of enabling platform for new digital services and players, as well as for new features and capabilities across traditional industries.

We would venture that such a role can be disruptive and bring substantial value to operators, as we are starting to see with IoT – one of the key capabilities to play this role. If we believe that IoT can generate material productivity and efficiency gains across industries, then operators will – at a minimum – collect the thin slice of that value which relates to connectivity. While these connections will always be very low revenue on a per unit basis, the sheer number of devices should make this a sizable revenue stream for operators in the medium to long-term. This will increase the enterprise segment’s relative importance for operators, and those better positioned to serve large businesses and equipped to provide services beyond connectivity will naturally capture a bigger share of this pie.

There are material challenges in execution and ability to monetise, but early signs from companies like Verizon and Vodafone show great potential.

CommsMEA: MWC is known for driving several entrepreneurial activities and competitions- how do you see the MEA market in this field? Is there sufficient drive to encourage entrepreneurship and convert projects into implementable realities?

Driving entrepreneurship is a broader ecosystem challenge which goes beyond an event, competition or even industry. While the MEA region has great opportunities in this area, there are some challenges with raising venture capital funding. This in turn directly translates into less appetite for young entrepreneurs.

Fortunately, a growing number of business-minded youths are venturing that way nonetheless, as examples of successful MEA start-ups (e.g. Careem, Souq.com) spur them on.

The region’s governments are moving to address these hurdles, and companies are increasingly doing their part – a good example is STC’s recent Saudi Technology Ventures, a technology venture capital fund equipped with $500m and headed by a former Google executive.

CommsMEA: As analysts/consultants, what’s the significance of MWC for you?

Most importantly it is a chance for us to connect with our clients outside of their typical work environment.

The less rigid schedules and ‘out of office’ atmosphere make for a pleasant change in the way we interact, which often results in the discussion of new, valuable ideas.

It is also an opportunity for us to facilitate the sharing of experiences and know-how between industry executives from different regions as they congregate on Barcelona. Bringing together executives who are facing or have faced similar challenges is highly valued by our clients but typically cumbersome to achieve outside of a global event such as MWC.

Finally, it is an opportunity for us to see first-hand the latest trends we have been researching, reading on and developing ideas about, which makes it also gratifying from a personal perspective.

It is much more fun to talk about VR when you have actually gotten dizzy from shooting aliens!

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