The major disruptions expected in the telecoms industry in 2017
As a new leadership team moves into Washington in January, big changes appear to be in store for the telecom industry in 2017. At the top of the list will be the outcome of the AT&T-Time Warner mega-merger, which now looks more likely to sail past possible anti-trust and net neutrality concerns.
We see the following topics and trends as important for business customers of the telecom industry in the coming year:
Merger activity on the rise
Expect to see the AT&T/Time Warner merger get approved and more M&A activity in the telecom space. Who will be next? Possibly Sprint and T-Mobile, a combination that was nixed by regulators in 2011. The Verizon-Yahoo deal, however, looks iffier following Yahoo’s revelation of more than 1 billion account being hacked.
All global carriers need to accelerate M&A activity if they want to stay competitive. With the pending Trump administration, US global carriers are anticipating a more lenient regulatory environment and will start to act on mergers that they have been waiting on. The US has actually been somewhat behind in this area.
M&A activity is also rampant in the cloud space and we’ll continue to see cloud provider consolidation. Are we going to see Google expand beyond Project Fi, and others grow more into the carrier space?
More subsidies on the way
First it was the growth of subsidized devices, then subsidized data. Given the impact that AT&T Direct TV has had on the industry, many expect to see this same trend impacting the enterprise. Consider if Amazon or Microsoft strikes a deal with a carrier so that enterprise data can be subsidized?
However, we will continue to see the opposite where devices are concerned. The leading carriers continue to move from subsidizing mobile devices to a more financing or out-right purchase structure. The carriers no longer want to focus on device procurement. They want to focus on their key-value add, which is providing broader and more reliable networks.
It’s all about the cloud - and will continue to be in 2017
As more companies move to the cloud, the quality of service, security and reliability will have an impact on how enterprises look at vendor contracts. How will this impact the relationship?
As power shifts from cloud providers to the business consuming cloud services, expect more competitive pricing and expect businesses to demand more robust contracts from cloud providers.
As Microsoft aggressively pursues owning all the enterprise endpoints through Office 365 and Windows 10, how will this impact enterprise mobile device management?
With Office 365 native apps becoming more present in the mobile workforce, MAM (mobile application management) providers are scrambling to create workarounds. Microsoft is making it very difficult for third parties to monitor their apps due to closed APIs, so enterprises looking to manage the content and data on these apps (think “save as” from Word or Powerpoint) will need to either go with Microsoft for enterprise mobility management (EMM), or use two EMM providers - one for the general enterprise, and then Microsoft Intune for management of Office apps.
The Internet of Things will continue to expand
Technology has now shifted to the point that it makes more of a business case for enterprises to look at IoT applications. Take for example low energy Bluetooth technology. When the costs of Bluetooth tech gets this low, with increased battery life and the ability to update all at once remotely, it becomes a key technology for industries like logistics, manufacturing, healthcare and retail.
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