Challenges that the telecoms industry will be facing
“After a decade of low inflation and low interest rates, the telecoms sector faces the uncertainty of how it will be affected by these cost increases and the degree to which it can increase its own prices in response. “Combined with high investment costs and questions about potential returns, the market outlook is challenging as the telecoms industry tries to steer its path through price rises, rolling out network availability and launching new services.”
Larry Goldman, Chief Analyst at Analysys Mason
Ongoing supply chain disruption
“Sourcing parts remains a challenge, delaying the timing of infrastructure deployment and fueling inflation. Talent remains in short supply and is expensive, especially for new skills that are required for digital transformation. In addition, the worsening geopolitical environment and continued COVID-19 lockdowns in China threaten to create new and persistent supply chain bottlenecks.”
Chris Antlitz, Principal Analyst at TBR
Virtual networking expanding
“All this application stuff swirling around the Internet and the cloud makes any fixed network strategy difficult. In fact, if you wanted to name a single trend to characterize 2023, you’d pick “virtual networking becomes networking” as far as users are concerned. In the cloud, in branch locations, and in the data center, the mission of connectivity will shift from the “physical network” to the virtual. Companies’ “networks” will be an overlay on multiple, diverse, physical networks. Applications will connect to virtual networks, and it’s virtual networks that will provide us security and that we’ll manage to assure information access and content delivery.”
Transformation of telcos
“The fourth trend in the coming year will be the accelerated evolution of telcos to “tech cos,” transforming telcos’ relationship with their customers and how they operate to unlock new revenue.”
Adolfo Hernandez, VP Of Amazon Web Services’ Global Telecom Business Unit
Emerging enterprise edge computing
“Deloitte Global predicts that the enterprise market for edge computing will grow at 22% in 2023, compared to 4% growth in spending on enterprise networking equipment and 6% on overall enterprise IT for the same year. Most of this growth will likely come from expenditures on hardware initially but should migrate toward software and services as the market matures.”
Telco and hyperscaler convergence growing
“In 2023, we can expect more operators to turn to the public over the expense of running their own data centre, and move workloads into the public cloud. Many will start with BSS/OSS, but we could also see some of the first network elements run in a public cloud on a live network, such as the 5G SA core or disaggregated RAN components, such as the centralised unit.”
Dario Talmesio, Research Director, Service Provider Strategies, Regulation, 5G at Omdia
The Year of NaaS?
“Organizations are increasingly looking to extend enterprise-class networks to remote and hybrid workers, a concept the IDC calls “the branch of one.” IDC reported that 69% of global respondents to a recent survey are planning to invest in network transformation over the next 12 months, highlighting network-as-a-service (NaaS) as a challenger to legacy network models that necessitate substantial upfront capital.”
IDC Analyst Brandon Butler told SDxCentral
What do you think 2023 will bring to telecom?
Looking ahead, broader economic concerns are driving service providers to re-evaluate their plans, focusing more on customer propositions and faster network transformation to ensure cost efficiency. So, expect to see service providers intensify their activities in these areas to weather today’s challenges and emerge fitter on the other side.
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