Amdocs looks at the impact the digital transformation and millennials will have on telecom in 2016
Editor’s Note: With 2016 now upon us, RCR Wireless News has gathered predictions from leading industry analysts and executives on what they expect to see in the new year.
Millennials, Generation Y (18-34 year olds) and Generation Z (born after 1998) represent almost half of the U.S. population. These are digital natives who cannot recall a time without Internet, tablets or mobile phones. They rely heavily on mobile and broadband, preferably mobile broadband. They have grown up with an array of communications platforms literally at their fingertips to be used at their convenience. They have no qualms switching between them or adopting new ones, as whim or fashion dictates.
These millennials are emerging as the dominant source of income and wealth in the U.S. They are the No. 1 workforce demographic in the U.S., accounting for $1.3 trillion in direct annual consumer spend; and their annual income is expected to reach $8.3 trillion in the U.S. by 2025.
All consumers, not only millennials, have come to expect anywhere anytime seamless experiences, and 2016 will see continuing work to implement this digital vision, changing the way we do every day “stuff,” whether that’s communicating, learning, customer service, navigating, shopping, paying bills, banking, watching TV and even parking. This trend will continue as more industries incorporate automation and weave digital into their products and operations, either by partnering and/or incorporating virtualization technologies (e.g. cloud), embedded connectivity and analytics to create new “smarter” services.
Networks are the foundation of the unfolding digital order, underlying a seamless and seemingly effortless customer experience. Service providers will continue to invest in this key asset: instilling efficiency by making their hybrid networks work together smarter and faster, using new technologies (e.g. network functions virtualization/software-defined networking, self-optimizing networks, “5G,” automation and analytics) as well as deepening the capacity of these networks (via spectrum auctions, Wi-Fi rollout and small cells) to support increasing consumer and business usage. The investment will result in quicker time-to-market of new services, including new network services.
Creating, offering and monetizing new services continue to be high on service providers’ agendas. This includes bundling existing services or bundling partner services with existing offerings. Companies across verticals, both traditional and new players, including service providers, are in a race to offer new digital products and services, which capture attention and wallet share. Taking this diversification road means service providers need to be agile; they will partner with, or acquire companies that will help them build new digital offerings. They will experiment with new business models to contend with over-the-top players who offer “free” services (such as ad-funded).
Some examples of this are the new “Go90” video services launched by Verizon Wireless, based on two acquisitions: Verizon’s purchase of AOL and OnCue. Other similar new services include Comcast’s Watchable; and Cox, which plans to launch “Flare,” a free, streaming Web TV service. Other examples of new services from the financial services world include services such as peer-to-peer lending, and continued development of non-traditional payment methods, which are primarily mobile (e.g. ApplePay, SamsungPay).
So, I’m looking forward to an interesting year with new services and higher bandwidth.
