In 2017, operators will realize the benefits of utilizing NFV to serve specific purposes in their networks.
Editor’s Note: With 2017 virtually upon us, RCR Wireless News has gathered predictions from leading industry analysts and executives on what they expect to see in the new year.
2017 will be a year of new merger and acquisition activity as operators look to acquire content providers, following the trend set by AT&T’s purchase of Time Warner this year. TV and streaming services are no longer just the remit of broadcasters and over-the-top players. Mobile operators will offer unique content packages as they make the shift to become multiplay businesses able to provide content services at any time, to subscribers anywhere.
Operators will not create their own content, but through strategic partnerships and acquisitions they can acquire a range of exclusive content, offering it to subscribers as a way to differentiate their propositions. Subscribers will start selecting operators based on the content that they provide (for example, choosing sports, TV or film packages). This will help to attract and retain customers, and provide an additional revenue source for multiplay operators.
Network functions virtualization becomes network functions ‘verticalization’
Throughout 2016, operators continued to progress their infrastructure development towards network functions virtualization. However, this trend has been dominated by operators choosing to work with network equipment vendors developing virtualized functions that are designed to run exclusively on their own NFV platforms to serve a specific vertical function, such as billing or firewalling. We expect this to continue in 2017, with the need for robust network functionality being the primary driver. This approach could perhaps be described as network functions “verticalization.”
Meanwhile, at the service layer where new real-time voice and video services are developed, we will see operators seeking to avoid vendor-locked NFV solutions. This is because such solutions engender service dependency on a single vendor, limit flexibility and tend to stifle further innovation. Therefore at the service layer at least, there will be a more open approach to NFV, with operators selecting best-in-class solutions. With this approach we are likely to see a host of new voice and video services developed by operators.
VoLTE and VoWi-Fi uptake increases with device compatibility
In 2017, there will be more affordable handsets available that straight out-of-the-box are voice-over-LTE and voice-over-Wi-Fi enabled. These handsets will support services from any native operator in the region without the need to download a firmware update or activate the service. As a result, the mobile network will automatically direct users to the most applicable access network for their voice and video calls, whether it’s Wi-Fi or LTE, with this process remaining transparent to the user. Subscribers will become accustomed to such ready access to rich voice and video services, which will increase service adoption through.
IoT/operator partnerships accelerate the advent of IoT vertical applications
Home security, self-regulating supply chains and autonomous vehicles – these are the kinds of vertical applications that are going to drive the development of the “internet of things” in 2017. Consequently, we can expect to see an increasing number of partnerships between operators and industry specific IoT suppliers to address the requirements of these vertical sectors.
In 2017, we will see software applications for these verticals running over a virtualized service layer. Interoperability building blocks and geographic coverage will be the key drivers for these IoT/operator technology partnerships.
Service agility moves from the lab to the boardroom
During 2016, we began to hear the word “agile” being used more often as a buzzword in the context of service development within telecoms operators. In 2017, we can expect conversations about “agile service development” to move from the research and development departments to the boardroom. Operators will be seriously considering how they can adopt new business models that enable them to rapidly develop and monetize their service innovations.
In 2017, operators will introduce virtualized service development environments that are more flexible and open than traditional approaches, which were predicated on fixed hardware. These new environments will allow operators to gain the agility typified by internet players, enabling them to empower their customers in new ways. This is especially important given the impact of internet services on operator revenue streams. We can expect more “agile mobile network operators” challenging the traditional way operators have offered services to customers, with a wider range of differentiation.
Death of the dumb phone
In 2017, we could finally see the death of the dumb phone as the market is flooded by entry level smartphones that support a variety of rich applications and services. These include built-in native operator services, available to the subscriber, straight “out-of-the-box.” We can expect to see more low-cost smartphones on the market, supported by services specific to demographics; for example, phones that support device-to-device money transactions in Africa. Such services will become key differentiators. Subscribers will make their entry level smartphone purchase decisions based on the unique set of operator services that come with them.