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IoT, 5G and Cloud Infrastructure the main investment priorities for the telecoms industry

That’s according to the Telecoms.com Intelligence Annual Industry Survey 2018, which questioned 1,500 operators, integrators, service providers and vendors from around the world to discover how the industry was feeling about itself, and what lies ahead.

Sixty per cent of respondents thought that the telecom industry’s overall business performance so far in 2018 was excellent or good, with 75 per cent feeling positive or very positive about the outlook for 2019.

IoT (51 per cent), 5G (48 per cent), and cloud infrastructure/service (45 per cent) were identified as the industry’s greatest investment priorities. Surprisingly, Security was seen as the lowest priority, chosen by only 28 per cent of respondents.

When asked about the most overhyped technology, AI was the most popular response (22 per cent), followed by 5G (20 per cent) and IoT (17 per cent), suggesting that the industry is still unsure about the real revenue potential of each technology before they become mainstream.

Increased pressure on price and profit margins (34 per cent), and competition from ‘Webscale’ giants such as Google, Amazon, and Microsoft (14 per cent) were seen as biggest threats to the respondents’ long-term business success. Inability to adopt an agile service model was cited as the third biggest threat by 12 per cent of respondents. That’s a surprise, because the industry is hardly noted for its agility.

5G’s greatest commercial potential is apparently to be found in high-speed mobile broadband, according to 45 per cent of respondents, while lack of spectrum availability was identified as the biggest impediment to the success of 5G. Nearly half of the respondents believed consumers would pay more for 5G service, but not by too much.

That’s interesting, as we haven’t met a single telco executive at any 5G conference this year who really believes this. Of course, our results are anecdotal, but we can’t help wondering if this optimism came more from the vendor community pushing 5G solutions than the operators. Just 10 per cent cited URLLC as being the key opportunity for 5G – which suggests that operators may be looking in the wrong direction, at least as far as we can see.

Stronger 5G momentum was also considered to be a driver for Test & Monitoring (T&M), with two-thirds of survey respondents expecting to see T&M impact their company’s success in the coming years. More than half of the respondents saw improving the performance and reliability of networks or services as the biggest benefit of successful T&M implementation.

Unsurprisingly, IoT was seen as an important driver for expanding service portfolio (58 per cent), while 46 per cent saw it as significant channel to deliver new revenues. Application platform, access infrastructure, and security solutions were identified as key investment areas in the coming years. Security topped the industry’s list of concerns for IoT success – which you would expect, as massive deployment of IoT devices creates an equally massive attack surface for threats.

Once again, the Telecoms.com survey provides important insights into the current thinking within the telecoms industry. While it reveals no huge surprises, it does highlight the fact that the industry seems to be on the same path, which can only be a positive thing as it seeks to reap the full benefits of the seismic transitions we are currently navigating. But, there’s plenty to be sceptical about, given the vested interests covered. Such industry surveys are useful to take the pulse, but there are pitfalls in reading too much into them. It may be that the least popular responses are actually the most revealing.

Take the impediments to 5G, for example. While we can’t disagree with the barriers cited, it’s curious that cost was noted by 12 per cent of the respondents. Really? With a massive increase in coverage density required, that seems to be naïve, to say the least. So, the research is welcome, but there is plenty of dissonance to explore.