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What Lies Ahead for CSPs

Stephane Bourque
1/22/2018
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It's an exciting time in telecommunications. Over the past year, we have seen unprecedented acceleration in almost every area of high-speed data. Operators are realizing the benefits of deploying next-generation infrastructure, such as deeper fiber builds and DOCSIS 3.1 technology. Automated BSS/OSS processes are cutting costs and reducing operational risks. Wireless connectivity over 4G LTE is reaching ubiquity in major markets.

At the same time, consumer habits are rapidly evolving while competition for subscribers is fierce. With the focus now on customer experience more than ever, that theme will remain for years to come.

But one thing stays consistent: The diversity of telecom growth keeps exceeding expectations. Service providers across the globe now have a buffet of technology options at their fingertips that is constantly stocked and updated with disruptive innovations. Popular choices in 2017 included big data applications that automate processes and enhance service assurance.

What trends are likely to shape 2018, and what solutions can address the most pressing challenges for service providers? Here are my top predictions for the year ahead:

1. Artificial intelligence will go mainstream
I recently installed a WiFi-optimization solution in my home and configuring it was as simple as plugging in some devices and pressing a button. The artificial intelligence (AI) within the devices did all the work -- within moments I had a full WiFi signal in every corner of my house. This example shows that plug-and-play devices are no longer just a buzzword, they're a reality.

The various AI applications have been conceptualized and we are seeing them come to fruition. E-commerce chatbots are leading us down a path where less human intervention is required in customer call centers. If you have a problem with your sale or service, these programs simulate conversation over the Internet to resolve your issue. Simulated CSRs will quickly find their way into the telecom industry, replacing traditional human roles with sophisticated AI that can analyze, diagnose and resolve customer service issues within seconds.

Does this mean call center personnel should worry? Not necessarily. In 2017, we saw the deployment of highly automated call center solutions. But, instead of letting employees go, operators changed the CSR role to include a sales function that helped unlock new monetization opportunities. The CSR role will evolve from troubleshooting problems to providing customer consultation with a greater emphasis on people (rather than technical) skills.

The application of big data collection and deep learning algorithms and their use in the Internet of Things (IoT) can't be stressed enough when we discuss smart homes and smart cities. The sheer volume of data received from IoT markets is too much for manual human processes, and manual proactive management of IoT is even tougher. For operators to ensure ongoing service quality in this emerging market, as well as accurately predict network capacity needs, automated analytic gathering and normalization solutions will be required.

2. Network upgrades will accelerate
There is more choice than ever for service providers looking at upgrades, and the costs of deployment and management are becoming more comparable as we move to all-IP networks. Cord-cutting, the reliance on OTT and the gradual decline of linear programming are pushing operators to deliver more bandwidth than ever. The growth of 4K TV, virtual and augmented reality (VR and AR), smart homes and cities and video streaming are raising the stakes for service providers. Network quality has become a key component of the customer experience because high-speed data and reliable service quality are among the most important features an operator can offer, especially as some providers begin to deploy proprietary OTT platforms. Network upgrades will occur rapidly due to these rising bandwidth demands.

Fiber deployment costs are lower than ever and this is pushing fiber into the last mile, creating fiber-deep networks. In its latest report on the global market, OECD found that fiber accounted for only 21.2% of subscriptions, meaning plenty of opportunity remains for service providers entering the space. The acceleration of fiber is complemented in part by the increasing adoption of Remote PHY, which distributes and decentralizes the network while simplifying operations with digital transport. Full Duplex DOCSIS 3.1, offering symmetrical gigabit service for upstream and downstream data, is set for initial trials in 2018 and will further boost network capabilities. These types of deployments are particularly more attractive and less expensive for greenfield system operators because they do not have to replace existing, legacy infrastructure and equipment. We can expect to see more deployments of fiber, DOCSIS 3.1, G.Fast, LTE and 5G in the next few years.

3. Mergers and acquisitions will rise
Cross-industry mergers and acquisitions are repositioning service provider organizations. Service providers are realizing the advantages of content ownership, and content providers are realizing the advantages of distribution partnerships. That's why we've seen such an incredible amount of power moves and partnerships by major organizations, such as Charter, Comcast and AT&T. Legislators around the world are trying to grasp the effects of the planned mega-mergers on content generation and distribution engines. Are these events going to benefit or harm the consumer? Visions vary.

We've all formed opinions about the plans for loosened Net Neutrality regulations, which are going to ease the process of acquisitions and mergers. But what remains to be seen is how responsibly large service providers will act under the new rules. Last year I wrote about how these changes could not only affect service providers, but also subscribers. One big question remains: will other nations follow the US down the path of repealing Net Neutrality? If so, mergers and acquisitions might reshape the entire landscape of the communication industry.

Bonus prediction: cloud computing will shape the future
It would be remiss if I didn't mention the increasing adoption of cloud computing enabling the future of network services. Forbes recently projected this market to reach $411 billion by the year 2020, and it's easy to see why. The more network operators can virtualize their infrastructures, the less they will spend on hardware upgrades and maintenance. Infrastructure-as-a-service (IaaS) was already projected to be worth $34.7 billion at the end of 2017, making it one of the fastest growing cloud services today.

On the service enablement side, cloud computing is making BYOD (bring your own device) an attractive option for consumers. By hosting network functions in the cloud, operators are accelerating the rollout of cutting-edge services while simplifying device management throughout the network. Expect to see a lot more adoption of cloud-hosted technologies in the year ahead.

— Stephane Bourque, CEO Incognito Software Systems

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