These six forces will disrupt the telecommunications industry by 2020
In preparing for this forecast for the next five years in telecommunications, I reviewed literally hundreds of predictions made by other industry observers. Many of these predictions were deeply technical; one needed an engineering PhD and an acronym encyclopedia in order to follow the conversation.
Written By: mchamberlainqz
March 6, 2015
In coming up with this list of predictions for telecommunications, I instead wanted to focus upon external factors that will drive the industry.
The six major disruptions that will drive the most change in telecommunications by 2020 are:
1. Integration: The content contest
Being connected continues to become cheaper and cheaper, adhering rather slavishly to Moore’s Law of diminishing costs. The cost of providing such a service keeps falling, and competition means that the price keeps getting smaller and smaller in a strong, negative feedback loop. Connectivity is capturing an ever-smaller proportion of the information value chain, while content, service, and product deliverers capture ever-more. By 2020, it is likely that one or more major telecom companies will be acquired by a content company.
2. IoT: The traffic explosion
The next major trend that will impact telecommunications is the explosion of connected devices. This internet of things, or Thingification, will add billions if not trillions of new connected data sources globally by 2020.
3. Mobility: The great wireless migration
Global growth of mobile connectivity is far outpacing hardline connectivity. This makes sense, as most growth is occurring in the developing world and amongst poorer populations. Such consumers may not even own a home, let alone a FiOS connection. For these people, mobile is cheaper, more convenient, and more useful, even when landline connectivity is an option.
4. Saturation: The search for growth
As they retire, boomers will enter retirement communities and assisted living facilities which are fully digitized in order to be as efficient as possible. Older Americans will be forced into using these technologies by the world around them and will likely consume vastly more bandwidth than they, or their carriers, ever imagined. As this occurs, the last remaining percentages of market penetration will be achieved, and the market will be thoroughly saturated.
5. Security: The network is the threat
As custodians of the networks, carriers play a pivotal role in fighting the new threats that are emerging. Customers will begin to expect, then demand, more proactive protection from the entire internet value chain, and carriers will be expected to support these expectations with a range of technical and operational innovations. The desire for greater security may be a boon for carriers, if they embrace the need.
6. Ascension: Skynet finally gets real
I’m predicting that Skynet 2.0 is about to reappear. These space-, balloon-, or drone-based systems will provide high-quality broadband access to anywhere and everywhere in the world, they’ll do it affordably, and they’ll likely start arriving around 2020. And this time, they’ll be wildly successful.
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This article was produced by HP and not by the Quartz editorial staff.