The digital future is unknown...and that's okay

Not a year goes by in the telecoms space where we don’t have a hype cycle around some technology trend. In 2016, it’s a combination of 5G, the IoT and the digital economy, which are actually geared towards the same general vision of the future in which economy will largely be driven by digital services (and the efficiency gains therein). The IoT will comprise a major chunk of those services, and 5G will make them available literally everywhere.

Which leads to things like flashy corporate videos at industry conferences showing us glossy, shiny scenes of that future. At one recent conference I saw one that was made (though not presented) by Corning. It’s called “A Day Made Of Glass”, and it shows a typical family uses glass displays (walls, mirrors, windshields, signage, devices, etc) to access various digital services that leverage GPS, big data, augmented reality and unlimited bandwidth to make their lives easier and more connected. And so on.

I used to be impressed with videos like that. Now I watch them with skepticism. It’s not the future, but one possible future of many - and one that not everyone will experience. The people in those videos are clearly affluent enough to afford a car (connected or otherwise) and a nice sized house, let alone the actual technology and gadgets. Yes, costs are coming down, but not to the extent that most people would be able to afford the lifestyle represented in the video. Also, people in the Philippines watching that video may chuckle wryly at the thought of having the required broadband speeds anywhere near that good.

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Telecom Asia May/June 2016

I’m not saying the digital economy won’t happen. I’m saying that, frankly, we’re rubbish at predicting the future, at least when it comes to consumer adoption and behavior, especially as consumers have become more empowered to decide for themselves how they want to use the technological tools being made available to them. The history of telecoms and ICT is littered with services that were supposed to be The Next Big Thing, which turned out to be something no one expected. Video calls were touted as “the future” of basic communication for over 50 years. It turned out to be text messaging with a social media twist.

Look at it this way: the reason everyone is experiencing “digital disruption” is because they didn’t see that disruption coming. At all. So the only thing we can be sure of about the future is that it will be full of things we’re not expecting. The digital economy will come, yes, but it will have all new surprises for us. Digital natives and postmillenials will take this in directions that will bewilder old folks like me but make perfect sense to them. And we won’t see most of it coming.

This is why when we talk about 5G, SDN, IoT etc, we talk about agility and flexibility and the ability of the network to handle whatever the digital natives decide to throw at it. Which is smart. But it’s not just the networks that have to be flexible - it’s also the business models. Telcos who are moving into digital services need to seriously think about new ways of bundling, pricing, partnering and - perhaps most importantly - failing.

Complicating things is the fact that there’s no template for these new digital business models - unless you count existing digital companies like Uber, AirBnB, Netflix, etc. Which you shouldn’t, because those companies make their business models work precisely because they’re not telcos.

Conversely, telcos are not OTTs. Nor should they be. At our recent Telco Strategies conference in May, a recurring question was whether telcos need to become OTT players. Professor Paul Morrissey, global ambassador for big data analytics and customer experience at TM Forum, responded: “If we try to be OTTs, we’ll be second in the queue. We need to start our own queue.”

However telcos brace and transform themselves for the digital economy, the main thing to remember is that you don’t have to know what the Next Big Thing is. You just have to be ready when it arrives.

This article was first published on Telecom Asia May/June 2016 edition

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