Operators Optimistic of Bright Future as New IoT Revenue Opportunities Come to Fruition

February 28, 2019

Among the many show-stealing IoT breakthroughs and showcases at the world’s leading tech event, there is a central question: how do mobile network operators increase revenue and profit in the emerging IoT market? This was put forward yesterday by PwC’s APAC telecoms lead, Mohammed Chowdhury, at the GSMA’s ‘Beyond Connectivity’ industry seminar at MWC Barcelona 2019.

‘The price of voice and data services is flattening and profitability has slowed’, Chowdhury declared.  As such, they operators are at a crossroads – do they stay as the reliable connectivity providers they are known as or is there a future beyond their historically core service?

As IDC’s Research Director Jon Gole asserted, ‘telecom operators are only able to address small slivers of the pie if they stick with just connectivity’. And yet, Gole stressed, ‘operators sit in a very advantageous position to orchestrate the ecosystem.’ As put by the GSMA’s IoT Emerging Enablers Lead, Neill Young, ‘all over the globe operators are exploring and launching many new services and platforms to accelerated the growth of IoT.

This statement was supported by FarEasTone’s Director of IoT Solution Management, Luke Wang, who demonstrated a number of ways in which the East Asian operator had made inroads into IoT service provision. Addressing Gole’s predictions on revenue opportunity, Wang claimed that ‘our experience of that is more or less true, with just connectivity we can only expect 5 or 10 percent share of overall IoT revenue – applications are becoming as important to customers as connectivity’

Wang revealed an impressive number of vertical markets that the operator had broken into, including energy management, asset tracking, biking and healthcare. ‘There is still a long way to go, but as an operator we have a good starting position. We, as an operator own the most important part of the value chain – connectivity. Without connectivity the internet of anything does not exist.’

SingTel’s Senior Director of IoT and M2M Product Management, Sriram Venkataramani, observed that a common operator strategy had been to move into vertical markets or improve their horizontal offerings. ‘The horizontal way is the route we have taken’ asserted Venkataramani, who claimed that they had achieved market success through products such as their widely applicable NB-IoT- enabled Smart Lock.

In speculating what the future held for operators, China Mobile’s Senior Technical Director, Liu Yuan, expected that there would be a change in how consumers and business perceive them; ‘most of our customers will start to see us as an IoT provider than an operator of the best network’. Indeed, Yuan’s claims already seem to be coming to fruition with operators playing ever more active roles in IoT, digital identity, edge computing and Cloud XR. We for one, expect to report substantial progress in these markets in the coming months.

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