Telcos in the M-ICT Era
Abstract: We have already stepped over the threshold of the M-ICT era. This era is more people-oriented, and is the era of the mobile Internet of everything. In the M-ICT era, the customers and markets for telcos will change, and this will impact telecom networks, maintenance, and services. This article briefly describes how to seize the opportunities coexisting with the challenges in the M-ICT era, and how to provide better service and experience for customers.
M-ICT Era Is Developing Vigorously
We have already crossed the threshold of the M-ICT era.
This era has four important features: 1) Users can connect to the Internet anytime and anywhere; 2) Services are available everywhere, making it difficult to distinguish between work and life; 3) Virtuality is combined with reality; and 4) Great importance is attached to security and privacy.
The above features attach "M" era labels to ICT industry development, and allow the ICT industry to enter the M-ICT era, an era of mobile Internet of everything. "M" introduces "people" into the ICT industry as its main body of services. "Being people-oriented" is an ideal choice and also a realistic choice. The basic elements of an M-ICT information society consist of network connections existing everywhere and providing high quality and high speed at low price, and information services more close to individual, home, and enterprise needs. The keys to success are to ensure that "service are available everywhere" and that "user experience comes first". Cloud-based Internet services become available by using intelligent terminals at hand. The continuous growth of Internet of Things (IoT) terminals increases the needs for network connections. The data traffic becomes one of the basic consumable goods like water and electricity.
Great changes in the M-ICT era drive traditional telcos to change. Data traffic consumption is replacing voice/SMS message consumption, becoming the most important basic service provided by telcos and a major source of revenue. With the development of global LTE in 2014, the scale of traffic consumption rapidly grows. Based on data traffic operation and TCO control, mainstream telcos achieve an operating revenue increase with the growth of traffic consumption, change the situation where the operating profits keep falling in the past years, and reach the profit turning point.
In the M-ICT era, the following development pattern for telcos is gradually taking shape: ensuring that compared to the investments in data traffic operation activities, the revenues from these activities are favorable, providing information services for both home and enterprise customers, and highlighting the value of big data.
Markets and Customers in the M-ICT Era Become More Diversified
In the M-ICT era, customers and markets for telcos will become increasingly diversified. As the operating revenues in global telecommunications grow steadily, the sources of revenues and their proportions keep changing. In the next few years, the traffic expense will exceed the voice/SMS message expense, and become telcos' main source of revenue. At the same time, with the long-term development of home, government, and enterprise customers, the proportion of revenue from such customers will take a bigger part in the total revenues. The cross-industry application of the IoT and big data will arise, further driving the transformation of telecom operation.
How to select customers and markets is a key issue for telcos in the M-ICT era. For different customers, different market strategies must be made. The key tasks of telcos are described as follows.
Consolidating individual customers by providing data traffic and upgrading converged communication services
Developing home customers by focusing on home theatre & entertainment and smart home
Developing government and enterprise customers with mobile enterprise networks, and actively participating in smart city construction
Developing cross-industry innovative services, such as Internet of Things and Big Data
Infrastructure Networks in the M-ICT Era Develop Towards the Direction of Being Mobile, IP/Optical Fiber-Based and Smart/Virtual
To deal with the market and customer changes in the M-ICT era, telcos must develop or upgrade their infrastructure networks accordingly.
The infrastructure network evolution includes access network evolution, backbone network evolution, and network architecture evolution, which respectively correspond to the evolution trends towards being mobile, IP/optical fiber-based, and smart/virtual.
Evolution towards being mobile: This evolution trend is the main direction for telcos at the access network layer. In the M-ICT era, this trend becomes increasingly obvious with the popularity of mobile Internet services and smart terminals, vigorous development of the Internet of Things, and high dependence of users on mobile equipment. The challenges brought by the evolution towards a mobile network drive the changes and evolution of wireless network technology. LTE is the focus of current wireless market growth, and achieves the convergence of FDD and TDD. However, the following problems need to be solved: cell interference caused by the large deployment of base stations at the same frequency used in regions, spectrum sharing under the convergence of multiple networks, and FDD and TDD operation. In the M-ICT era, mobile smart terminals, cloud applications, and the Internet of Things will promote the explosive growth of data traffic expenses, and drive 5G technologies to achieve 1000 times the current system capacity, 10 G access speed, "50 billion connections", and drive the application to a variety of scenarios.
Evolution towards being IP/optical fiber-based: In the fixed access field, IP access devices offering large capacity and combining fiber and copper become the trend. At the transport and bearer layer, IP bearers are the effective choices for implementing network flatness and cutting operation and maintenance costs. While improving mobile network performance and transmission efficiency, IP-based mobile access also helps telcos greatly cut the transmission costs. IP-based core networks become the basis of cloud computing, implementing the centralized computing and processing of information. The rapid development of the optical fiber technology enables the backbone and convergence networks to bear a higher transmission rate over the original optical network architecture, and the 100G/400G/1T technology researches become mature and can be put into commercial use. At the access side, the development of home multi-media and enterprise converged ICT services requires a higher access speed, driving the development of the FTTx technology. In the future, the development of wireless broadband will continuously promote the application of the optical fiber backhaul technology.
Evolution towards being smart/virtual: In traditional telecom networks, there are a great number of closed and private systems, especially multiple incompatible hardware devices. In Software-Defined Networking (SDN) architecture, the control plane is decoupled from the data forwarding plane. This makes network control programmable. The Network Function Virtualization (NFV) technology decouples the hardware from software and encapsulates the hardware devices at the bottom layer of the network, such as computing and storage devices, switches, and routers into a resources pool, implementing the flexible scheduling and effectively cutting network cost. Virtualization innovations, such as ElasticNet-series solutions, can be applied to data centers, government and enterprise networks, and telcos' access, bearer, and core networks. The key value of ElasticNet is the integration of SDN and NFV technologies into a layered architecture. With the cloud computing concept, ElasticNet improves network elasticity and virtualization capability. It enables elastic network configuration based on actual requirements. Therefore, it helps telcos meet the changing demands of customers and quickly adapt to new business models.
IT Systems, Security, Maintenance, and Services in the M-ICT Era Need Upgrading
As the number of high-tech crimes around the world increases rapidly, especially after the exposure of the "PRISM" plan, telcos must continuously upgrade communications networks, to ensure communication security. In addition, telcos should provide different security solutions for different application scenarios, such as mobile network, virtualized network, end-to-end network security monitoring and centralized control, and IP network transparency.
Telcos should also transform their network operation and maintenance services, to improve operation and maintenance efficiency, cut operation and maintenance costs, and increase operating revenues. The evolution of operation and maintenance services in the M-ICT era covers the implementation of intensive operation and maintenance management system and user experience-centered service operation and maintenance system, and the capability to analyze big operation and maintenance service data with comprehensive ICT services.
To conclude, the customers and markets of telcos, the evolution of telecom networks, and operation and maintenance services will have features of M-ICT era. While facing unprecedented challenges, telcos will also have a lot of opportunities with a brighter future if they can grab the opportunities, keep up with changes, and provide better communication services for customers while being people-oriented.