It's that festive time of year when the soothsayers and prognosticators peer into their virtual reality glasses and summon up visions of the near future.
With predictions popping up like streamers at a Christmas party, Light Reading here lists some of the most eye-catching end-of-year forecasts from our own editors and analysts as well as other organizations.
Let's start with the big picture on the economy from a respected authority on economics. Despite growth in subscriptions, "the telecom sector's finances will come under increasing strain in 2018," predicts the Economist Intelligence Unit, prompting "a rethink of strategy and investment priorities." In the mobile market, average revenue per user (ARPU) will fall by 2.3% across 60 markets The Economist Intelligence Unit Ltd. (EIU) examines. The ARPU decline in the fixed-line sector will be as much as 11.5%, it reckons. SDN and NFV get a call-out from the market research business as technologies that might give telcos more "flexibility." But the EIU also reckons that operators may be vulnerable to a takeover by one of the web giants. It's a view shared by Light Reading International Group Editor Ray Le Maistre. "Tier 2/3 mobile operators will become financially distressed and Google will acquire at least one at a rock-bottom price," he says.
Will NFV Make Me Rich?
Telecom executives are peering nervously into the near future.
Ray has come up with a slew of other forecasts for 2018. "Major telcos and mobile tower companies will turn their M&A attentions to companies that hold significant urban real-estate assets as edge computing/small cell planning becomes more strategic," is one of his headline predictions. Automation will also gather pace, says Ray, with ramifications for sector employees. "Job cuts at telcos will accelerate as automated processes are introduced, with only a minor percentage of staff impacted by automation retrained or offered other roles by their employers." Stay tuned for his other thoughts on telecom in 2018… (See Efficiency Drive by Major Telcos Has Claimed 74K Jobs Since 2015.)
M&A mega-deals will continue in 2018, with more consolidation in the semiconductor and IoT markets in particular, says Daniel Kurgan, the CEO of the BICS international carrier business owned by Belgian incumbent Proximus. "We should expect more deals involving chipset and semiconductor manufacturers, as those in the wider telco industry look to capitalize on IoT growth," says Kurgan. "Continued hype around driverless cars will also drive M&A activity between the telco and automotive industries." (See Intel Bets Chips on Network Platforms Consolidation, Broadcom Offers $130B for Hostile Takeover of Qualcomm and Marvell Confirms $6B Deal to Buy Cavium.)
Sticking with the M&A subject, Heavy Reading head Dennis Mendyk predicts that AT&T's $85 billion takeover of Time Warner will go ahead, despite opposition to the deal from some quarters. "AT&T will win its case against the US Department of Justice and will wrap up its acquisition of Time Warner," says Dennis. "The first reason is that there's not significant difference between this deal and the Comcast/NBC merger. The second is that AT&T has better lawyers than the DoJ under the current administration." (See AT&T Shakes Industry With $85B TW Bid.)
The security market is a pretty safe (arf) bet for growth in spending next year, according to Gartner Inc. The crystal-ball gazer (whose magic quadrant is the necromancy of technology soothsaying, as far as some are concerned) reckons enterprise spending on security products will rise 8% this year, to around $96.3 billion. Various factors are driving the increase, says Gartner, including new regulations (such as Europe's General Data Protection Regulation, or GDPR), a shifting buyer mindset, growing awareness of emerging threats and the evolution to a digital business strategy.
Another expert weighing in on GDPR is Heavy Reading's Steve Bell, who thinks the legislation could pay off handsomely for its sponsors. "GDPR will prove to be a real revenue earner for Europe as multiple US companies wake up to the reality they are breaching the regulation and are subject to a fine of up to 10% of their revenues," he says.
There has already been a wave of hype -- and by no means a millimetric one -- about the very high frequency bands that operators could use to support 5G services. In 2018, though, the industry will get over its fascination with so-called millimeter wave (mmWave) spectrum and start to focus its efforts on the far more useful 3.5GHz band, says the Northstream consulting business based in Sweden. "Given the limitations of mmWave and low bands, mid-band spectrum such as the 3.5GHz band -- although less exotic -- brings more practical and realistic benefits," says the company. "A considerable amount of 3.5GHz spectrum is available and can be directly deployed onto existing grids while still taking advantage of massive MIMO technology." While US operators have talked up mmWave, and spent heavily on it, several European incumbents have suggested that 5G services will be launched initially over 3.5GHz airwaves.
Similarly downplaying the usefulness of mmWave technology, Dan Jones, Light Reading's mobile editor, notes that 5G technology will see its first service launches next year, but says these will be "small and limited." Commenting further on 5G in 2018, Jones says: "It may happen in a few neighborhoods in US cities and South Korea. But it will still be an underwhelming debut, with (sometimes) gigabit alt-fiber service over the air. If there aren't too many trees!" Dan also predicts a backlash by city residents and mayors to large-scale tests of self-driving cars in their communities. (See Verizon Says 'Up to 5' Fixed 5G Markets Will Go Live in 2H18 and FCC Wants to Open More High-Band Spectrum for 5G.)
Next page: Flying cars and smart home rage
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