Trend Analysis: Key Telecoms Trends for 2020

From technology to geopolitics, 2019 was abuzz with headlines about 5G, buoyed by the first rollouts in major cities around the world. This is set to continue in 2020, and planned discussions at MWC certainly reflected this, as did the myriad of 5G-enabled handsets that were set to be unveiled. However, with far more installations still to come, and many of the technology’s most impressive features still some years away, 2020 will not be the dazzling year of 5G that some might be wishing for.

“The 5G hype train continues to roll on; service providers and a select few technology vendors have their bullhorns turned up to 11 and in continuous use. Back in reality, 5G sits with nearly no end devices and coverage maps that could only be generously called meagre,” said Steven Schuchart Jr, principal analyst for enterprise networking at GlobalData.

“We are at the beginning of a long path, in spite of a more rapid than expected set of 5G rollouts by US and European operators in 2019. In two or three years, enterprises should expect improvements in application latency, processing speed and the ability to use ‘massive’ amounts of data for real-time insight,” added John Marcus, principal analyst for enterprise cloud and security services at GlobalData.

Although quieter than 5G, 2020 is arguably going to be a bigger year for the latest WiFi standard, WiFi 6, which is also known as 802.11ax.

“WiFi provides ubiquitous access in every building and business, with support on virtually every device including IoT devices. WiFi 6 brings many of the technology advantages of 5G, without carriers, contracts, and the need to replace everything with 5G-enabled products. The first real shipments and serious installations happened in 2019,” said Schuchart.

“In 2020, we will see widespread installation of WiFi 6 as companies upgrade campus networking gear with not only WiFi 6, but also the idea of a new access model – that security and policy should be applied evenly regardless of how the user accesses the network on wired or wireless.

“Furthermore, we should see progress on the addition of 6 GHz for WiFi 6, which would be a huge boon in terms of spectrum congestion at 24 GHz and 5 GHz. There are still regulatory and industry issues that must be worked out, but a resolution should be seen in 2020.”

Edge technology has been a growing buzzword across technology, with organisations increasingly moving some processes back from the cloud to capitalise on increased speeds and lower latency. But in 2020, we’re likely to see more telcos and telecoms-related applications of edge technology begin to be realised. And this is likely to be the result of growing efforts by major cloud providers.

“Hyperscale cloud providers will play an even bigger role in emerging edge computing ecosystems in 2020, deepening their relationships with existing partners, while also forging and developing new partnerships,” said Chris Drake, principal analyst for data centre technologies at GlobalData.

“In 2020, hyperscale cloud companies will also promote existing solutions to new markets, while simultaneously investing in the development and promotion of new solutions. Towards the end of 2019, both Microsoft and AWS unveiled new partnerships with major telcos, with the aim of combining cloud resources (infrastructure and services) with newly deployed 5G network infrastructure and positioning those resources close to places where low-latency and high-performance apps will be developed and consumed.

“These initiatives are still at the pilot stage and are available to a limited number of select customers and within limited geographies. Going into 2020, the scope of the partnerships will be extended to new cities and will involve more enterprise customers.”

One key trend that analysts expect to continue to grow – albeit quietly – is digital mobile brands, which provide the traditional mobile phone subscription service in an entirely digital, app-based format. And while this was never going to be a major topic at MWC, it is very likely that there would have been discussion from key players and interested parties in this space.

“Last year, we reported on the launch of a number of new ‘100% digital brands’ appearing in the market, from Orange Flex in Poland, to SingTel’s GoMo, Win by Inwi in Morocco, and By.U in Indonesia,” said Emma Mohr-McClune, service director, and Natasha Rybak, principal analyst for consumer services Europe at GlobalData.

“For the most part, these brands are entirely carrier-owned and managed, created to investigate and better understand the challenges and opportunities implicit in a radically new and purely digital go-to-market provisioning model, in which everything – from registration to billing, SIM ordering, plan customisation and support – are self-managed from an app interface.

“None of these projects have been overwhelmingly successful to date, but they are proving valuable as a learning exercise for carriers challenged to meet aggressive digitalisation goals, and we’ll see more of them in 2020.”

Embedded digital SIM cards, known as eSIMs, have seen hesitant growth over the past year, and certainly some vendors would have been pushing the technology at MWC. However, while there is likely to be some increase in adoption and consumer recognition in 2020, it is unlikely to be the major surge some may have been hoping for.

“The prospect of reprogrammable embedded SIMs, capable of easily switching user profiles in wireless devices, has been around for some time,” said Mohr-McClune and Rybak.

“Even though Apple, like Google before it with the pioneering Pixel eSIM phone, has adopted the GSMA’s specifications, we’ve yet to see significant collaboration between OEMs and operators, and the industry is still largely unsure how remote provisioning might work in practice.

“This has caused operators to postpone product development, which in turn has caused other OEMs to de-prioritize eSIM device progress. We predict this trend will continue into 2020.”