Telco survival skills for the digital multiverse

01 Jun 2016

Here we are again at CommunicAsia 2016. This week you are going to be hearing the word “digital” a lot: digital disruption, digital transformation, digital services, digital economies, etc.

And it all points to the same basic concept: digital companies and OTTs are disrupting the traditional paradigms of just about every industry in the world, and telecoms is no exception. Telecoms operators must transform their business into one of those disruptors. They cannot keep doing what they’ve been doing for the past 50 or 100 years. Telcos have to change their infrastructure, business models, corporate culture and mindset to play a role in the new digital economy that doesn’t just involve providing the pipe.

You know this, of course. You’ve been hearing it at industry conferences and the trade press for the past few years. You’ll be hearing it again at the CommunicAsia Summit, and very likely on the exhibition floor, the coffee stations, networking cocktails and possibly the casino. You’ll hear lots of predictions about the future. You’ll hear lots of proposed solutions to enable that transformation, and business opportunities to pursue on that transformation journey. Some of it will be accurate, some otherwise. Always in motion is the future, as they say.

One thing I hope you’ll be hearing about is how digital transformation is not just about what happens within the telecoms space, but outside of it.

Tomorrow morning, Gerd Leonhard, noted futurist and CEO of The Futures Agency, will be speaking about the next five years on global digital transformation. I don’t know exactly what his talk contains outside of the bullet points in the conference program, but if it’s anything like past talks I’ve seen him deliver, he will cover a lot of bases that may go outside the usual boundaries of telecoms planning.

For example, in previous talks Mr Leonard has pointed out that the lines between industries are blurring to the point where they are no longer self-contained - so telcos end up competing in “service arenas” against broadcasters, software developers, etc. He’s also talked about how big data is more than a tool for engaging customers - it’s a stark example of how the power of technology now exceeds the scope of our ethics (see: the NSA, loss of privacy, flawed security, abusive marketing, etc).

It’s not hard to extrapolate from this to imagine what other factors are going to be shaping the digital economy in the next ten years besides empowered post-millennial digital natives for whom smart devices, multiple screens, Netflix, Spotify and ubiquitous connectivity are the default environment. Think of the impact of, say, climate change on food supply chains and economic trade, the impact of robots with artificial intelligence on the workforce, or the political ramifications of a big-data arms race, and you get the idea.

Obviously there’s little operators can do about these kinds of external factors, and there’s no way to know for sure how they’ll play out. But it doesn’t hurt to be aware of them.

The digital economy is nothing to be afraid of, but it’s unlikely to be the digital utopia we see in visionary corporate videos. In fact, it’s unlikely to be anything we can imagine. We are stuck in the present looking at possible futures, not the future.

One prediction we can feel fairly confident about is that telcos will be key to the whole digital paradigm. They have the networks, the customer relationships and the ability to bill them. But again, that alone is no guarantee of survival. Telcos must transform themselves into businesses that can function in that paradigm as digital service providers armed with networks and business models that can handle whatever the future is going to hurl at them. Flexibility and agility aren’t just buzzwords for XaaS, network virtualization and service creation - they are survival skills for all possible

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