Top Five Telecom Trends for 2023 – Revisited

Six months into the year, we return to our top industry trends for 2023 – as voted for by our social media followers – to see how the headline-making stories are changing the telecoms sector.

At the end of last year, we put 16 trends poised to shake up the telecoms industry to our social media followers to see what they thought would be the top telecom trends of 2023, in an attempt to anticipate the transformative forces shaping the industry.

As we now reach the mid-point of the year, it is time to revisit those trends and assess how accurately our predictions have stood the test of time.
 

Artificial Intelligence

You’re probably already sick of hearing about AI this year, but like it or not, we’re in “The Age of AI” according to Bill Gates.

Perhaps he’d reconsider if he’d seen this AI-generated conversation between “himself” and (a suspiciously English-sounding) Socrates which, if the latter had been around to witness, would have him reaching for the hemlock:

Yes, since the release of ChatGPT towards the end of 2022, the tech industry and many onlookers have been in an at-times hysterical dress rehearsal for the singularity.

There’s no doubt that AI can benefit many parts of day-to-day business operations, particularly in customer care and support, enhancing the level of service rather than erasing jobs, just as the creation of image editing software didn’t make graphic designers redundant.

However, that’ll be little comfort to the tens of thousands of staff BT are axing, many of whom will reportedly be replaced by AI, in a move closer to the replacement of switchboard operators with automated exchanges.

Right now, many firms are still reluctant to give the bot access to their inner workings; JPMorgan is just one of several major firms to ban staff from using ChatGPT. Nevertheless, others are embracing the potential of AI with open arms; Nokia Digital Assistant claims to be the industry’s first purpose-built chatbot, trained on a massive dataset of specialist telecoms technical knowledge.

ChatGPT is also now available in Azure OpenAI Service, its blog sidestepping gushing praise or cynical doomerism to offer possibly the most level-headed outline of its capabilities: “summarizing content, generating suggested email copy, and even helping with software programming questions.”

Meanwhile, Goldman Sachs has warned that AI could replace 300 million jobs worldwide, and not only in tech; the risk of AI has been directly cited by the Writer’s Guild of America as one of the catalysts for the union’s ongoing strike, bringing hundreds of productions to a halt as screenwriters battle to keep AI out of the writer’s room; Warner Bros. has already announced that AI will help decide which films to greenlight.

OpenAI CEO Sam Altman, in a quasi-manifesto posted on the company’s blog, stated that Artificial General Intelligence (AGI, something which ChatGPT is demonstrably not) can give “everyone incredible new capabilities… to help with almost any cognitive task,” but warned that it could also bring “serious risk of misuse, drastic accidents, and societal disruption.”

A separate open statement, signed by Altman, plus Gates and other leading AI scientists and public figures, simply states that “Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.”

It’s this fear that led Altman to, before the US Congress and a panel of fawning representatives, call for government regulation on AI – but not before touting the incredible powers of his product.

This year, he’s been on a world tour, oscillating between deflating the capabilities of the model, which he’s said are “still flawed, still limited” one moment, before saying the AI boom could end in “doom” or even “extinction” the next moment.

Governments across the world are certainly taking the latter seriously; the EU is already drawing up legislation forcing companies to disclose copyrighted material used to train their systems, and clamp down on AI that is a “clear threat to the safety, livelihoods and rights of people.” Italy went so far as to briefly ban ChatGPT altogether, bashing the bot with the GDPR hammer.

Meanwhile, UK Prime Minister Rishi Sunak has met with the CEOs of leading AI firms to discuss joint action to ensure oversight of AI development and governance, as the Treasury invests in a homespun “BritGPT” to take on other international efforts.

However, there are some signs that the hype cycle is plateauing, as more and more are coming to realise the limits of LLMs – or the drawbacks. Some of the models’ emergent behaviours have been branded largely a “mirage” according to research from Stanford University, no matter how outrageous they may seem – such as tricking a human into thinking it’s a blind person needing to solve a CAPTCHA.

A Terminator-style machine uprising is severely unlikely, but that isn’t to say that AI cannot be wielded by scammers and bad actors for unsavoury actions. Fraud, misinformation, intellectual property theft – LLMs are forcing us to address issues that have always existed, and that up until now haven’t been dealt with.
 

The cost-of-living crisis

Though there are signs that rampant price increases and runaway inflation are starting to slow, the cost of utilities, including connectivity, remains high, as Europe has skirted close to recession.

In the UK, many CSPs pushed through large price increases to mobile and broadband services of around 14% in April, in line with the consumer price index (CPI). And despite the availability of social tariffs, millions have yet to make the switch, with only 5% of eligible households having signed up so far. In fact, a survey by Citizen’s Advice of 6,000 UK broadband customers suggests that up to one million have already disconnected their broadband due to the cost pressures.

Meanwhile, Openreach’s new wholesale pricing arrangement for full-fibre services, Equinox 2, gives lower prices to retail providers if they commit to long-term contracts for Openreach’s fibre instead of copper, but has altnets warning that the scheme gives Openreach the ability to “set commercial terms that undermine new network build.”

ISPs would only qualify for discounts on wholesale pricing if they hit a certain proportion of new orders on Openreach fibre, thereby discouraging ISPs from considering other smaller wholesale providers.

Greg Mesch, CEO of CityFibre, points out that “while introducing price discounts to bind its wholesale customers and damage emerging competition, BT is… significantly increasing prices for millions of its retail consumers.”

Though inflation is falling, affordability will remain an issue; as noted by Ofcom, even back in 2020, nearly 20% of households were struggling with bills for connectivity services. Can telcos make their services more equitable while protecting their own falling revenues?
 

Smart cities

The worldwide smart city market is expected to grow to $301 billion by 2032, up from $121 billion in revenue this year.

Cities such as Helsinki, Zurich and New York are increasingly being recognised this year for their smart credentials, but it’s Shanghai that’s taken the crown as the leading smart city for 2023 according to Juniper Research, citing its “strong deployment of 5G, and its use of innovative technologies including digital twins.”

Meanwhile, representatives from South Korea are scheduled to visit Poland for discussions with Ukrainian officials regarding the implementation of smart city projects as part of Ukraine’s reconstruction following the war. Prior to Russia’s invasion, Ukraine had been pursuing smart city projects in Lviv and Zaporizhzhia to improve local transport and rejuvenate municipal infrastructure. These developments, if implemented, could prove vital to the regeneration of the war-torn nation in the coming years.

Beyond simply providing cables and connections, telcos can be key drivers of smart city research and development from data analytics to digital twins; in May, Telecom Italia signed an agreement with the National Research Council of Italy (CNR) to jointly develop digital tools for local authorities.

As more and more cities introduce smart functionalities, the risks of increasingly digital urban life are becoming apparent to governments and legislators. This month, a consortium of intelligence agencies published a Best Practices for Smart Cities guide to steer city planners through the inherent security risks of smart cities, ensure that residents’ data remains protected, and “unlock the benefits of smart, internet-connected infrastructure in a safe and secure way.”

Key to managing and monetising these smart city services is flexible and scalable BSS/OSS, supporting complex service orchestration, billing, and payments; in March, our Account Development Director revealed all in an insightful Q&A on the smart city project we are doing with Nokia for Egypt’s new Administrative Capital for Urban Development (ACUD), servicing millions of retail and wholesale customers in this new 700km² development located 60km east of Cairo.
 

Open APIs

CSPs and vendors from across the telecoms industry have been in a certification arms race to affirm their commitment to wider industry standards and verify that they remain compliant.

The GSMA, earlier this year, launched its GSMA Open Gateway scheme, in partnership with 21 major network operators, a framework of universal APIs for operators and developers promising “a paradigm shift in the way the telecoms industry designs and delivers services in an API economy world.”

Telus became the first North American CSP to obtain Running on ODA status from TM Forum, and the fourth worldwide following Axiata, Jio, and Vodafone.

While the telecoms industry is embracing open standards, the next step on this journey is monetising these APIs to better realise the value of investment in their network assets and open up new revenue streams. However, let’s hope they don’t follow the lead of Twitter and Reddit, who have sought to monetise their own APIs with disastrous results for other websites and their reputations among users.

Under Elon Musk’s regime and desperate to drum up some extra revenue, Twitter paywalled its previously-free API in April, which allowed users to create automated tweeting bots, or to extract and analyse data from the platform.

This decision cut off many long-standing third-party Twitter clients, and ended up breaking many parts of Twitter itself, eventually forcing the company to offer free access to some automated accounts, such as those providing transport and weather alerts.

Reddit, meanwhile, is pushing ahead with charging for access to its API, with one third-party developer warning it would cost them $20 million a year to continue using its API. As a result, many third-party apps have decided to shut down, and thousands of the site’s subreddits have “gone dark” in protest.

You can rest assured that Cerillion remains committed to open standards and responsible monetisation of services, having recently completed its first “real-world certifications” for TM Forum Open APIs, with its customer Neos Networks.
 

eSIMs

The global market for eSIMs is expected to increase to $16.3 billion by 2027, driven by strong sales of eSIM-enabled devices, such as the iPhone 14, which launched late last year in the US as the firm’s first eSIM-only handset.

Though not the first eSIM-only device on the market, as an industry trendsetter, Apple’s decision to ditch the tiny plastic card will have a knock-on effect for other manufacturers designing their upcoming devices.

The next iPhone in the UK and Europe could be eSIM-only in the not-too-distant future, but this isn’t stopping CSPs from already launching eSIM services. For example, Lyca Mobile has recently become one of the first MVNOs to launch an eSIM service for its UK customers, joining the four major mobile networks – EE, O2, Three, and Vodafone.

Beyond mobile handsets, the release of the GSMA’s new technical specification for eSIMs in May now provides enhanced management of IoT devices, simplifying the remote provisioning and management of low-power devices. By the end of compliance testing later this year, it will introduce a simpler and cheaper integration and management of millions and millions of devices.

Meanwhile, the return of roaming fees for UK customers has created an opening for eSIM providers, and Wizz Air has wasted no time in seizing the opportunity, partnering with eSIM Go to launch a data bundle for passengers travelling to destinations across the globe.

By the end of 2023, we’ll see further advancements in global eSIM interoperability, enabling travellers to connect to even more local networks and thereby sidestepping roaming charges.
 
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