The telecom industry is undergoing dramatic changes. As 5G service starts to roll out in a serious way next year, important new applications for business and consumer use will follow behind.
Andew Morawski is President and Country Chairman for Vodafone in the Americas, so he presents an excellent overview of telecom. He joined Vodafone in 2012 to focus on the Internet of Things, so he brings an IoT perspective as well.
During our conversation, I was struck by the richness of 5G applications that will soon arrive. The changing role of telecom providers, from commodity transport pipes to core enablers of transformation, was another theme of interest.
The original concept for this episode was to focus on digital transformation in the telecom industry. However, once we started talking, it became clear that business and consumer implications of 5G technology were more interesting. That said, Vodafone, along with its customers, is rethinking customer relationships and business models for the coming IoT explosion that 5G will enable.
Part of this shift involves evolving business and competitive relationships between Vodafone and its enterprise customers. Historically, telecom providers offered "dumb pipes," meaning the wires through which data and voice traffic flows. Today, the boundaries between data transfer, aggregation, applications, and analytics have blurred. It's not a new story, but as IoT and other networked applications expand, enabled by 5G, the volume of sensors, devices, and data will grow even more.
This growth raises issues such as ownership of metadata and the value of aggregated data that is not attributable to individual customers. In other words, as data flows through the pipes, who gets to operate on and own that collected data? Does the telecom company own the data? How about the customers? And what about government demands for access? There are also a host of security and privacy issues that come into play.
It's an international set of issues. For example, an article about the Telecom Regulatory Authority of India (Trai) calls data ownership, privacy, and security "complex and multi-dimensional."
These matters affect Vodafone along with virtually all other telecom operators. Although this discussion barely scratches the surface, it is immediately apparent that telecom today is not what it once was. We've come a long way since telecom meant voice calls only.
This episode of CXOTalk presents a view into telecom by a top player. Watch the full conversation embedded above and check out the edited excerpts below. You can also read the complete transcript.
What are the key trends affecting telecom today?
Andrew Morawski: It's a really interesting time in telecom between all the technological advances, socio-economic changes in the world, and then tag onto that all the regulatory changes in the world. It's definitely an interesting time to be in my role.
A couple of trends that we're seeing. The first one is the new global landscape. I say the "new global landscape" instead of "globalization," because we're in a new era now. It's not just, "Hey, we've opened up new markets for our company to sell new products or to sell new devices to new countries that we weren't able to sell to before." I think we've passed that.
Now we're seeing the next generation of globalization with competitors emerging from those markets. If you're looking at Tata in India, no one ever thought there'd be a major global automotive player based in India, to give you an example.
Another trend is new business models being developed because the speed and pace of change is going so fast that you've got to be able to keep up. You've got to adapt your business models to make sure that you can deliver on what you need to deliver for your customers.
The next big trend is probably the intersection of man and machine. People don't realize how many interactions they're having as customers of a company. They're interfacing with artificial intelligence already. There are new artificial intelligence innovations and creations happening every day, and that's certainly going to make for a change.
I think the last one is around the changing work environment. We've moved to a digital workforce. We've moved to an environment where people don't need to be in an office or at a desk to do their jobs and deliver on their responsibilities.
What's happening with 5G networks?
Andrew Morawski: More devices, higher bandwidth, and lower latency. If you look at it from a capacity perspective, if I take the first one, there are only so many devices that can be connected at one time to a cell tower, let's just say. In 5G technology, the number of those devices is going to multiply by 10 or 50 fold, even. What that means is, if you think about the Internet of Things or connecting things to the Internet, the limits that we had before around how many things could be connected are going to go away, or the limits are going to rise considerably.
If you take the second one, the higher bandwidth or more capacity, think of how long it takes you to download a video on your phone. Picture those times being cut to a tenth of what they are now. Think of the applications that then opens up for live HD video streaming, especially in your part of the business.
Then the last one, which I think is probably the most interesting one and the most impactful is the lower latency. Right now, you have a sensor here on this side and connectivity or whatever you're connecting to back on this side. You've got a latency from when the sensor opens and shuts to when you can take action based on it. Latency with 5G is going to go down to one to two milliseconds, potentially. It opens up the world to do things like remote surgery, true virtual reality, things that can't work or can't happen with a delay.
Also: The race to 5G: Inside the fight for the future of mobile as we know it TechRepublic
5G also is going to bring resilience. 5G isn't just a new network. 5G is utilizing five different technologies to create a new network. There's going to be different types of technology that are broadcasting signals at different spectrums so that you'll get more of that resiliency because, as you get into those kinds of life-critical applications, the margin for error is zero.
What are your customers doing with 5G applications, such as autonomous vehicles and others?
Andrew Morawski: Our customers are knee deep in it, especially our automotive customers. Vodafone has opened a test track in Germany where we test autonomous driving technologies. It is at the forefront of everyone's mind because that's where the real transformative things are going to happen with 5G. Again, if you think about autonomous driving, you've got to think of the number of connections that you need to have and also, again, back to that latency point. There's no time, not more than a split second, to make a decision as a driver would to process information in an autonomous system. From that perspective, 5G is the real enabler of autonomous driving.
For different applications, different things are going to be more important. For small sensors that are just sending ten megabits of information, depending on the application, latency may not matter. It's just a matter of being able to receive those promptly, maybe even collect them once a day. But, in other applications where you've got something meaningful that has to be transmitted in real time, like driver information, vehicle information, or virtual reality information to deliver an experience to someone, that's where that latency is going to be key.
The bigger bandwidth is going to be key if you're watching, let's say, connected drones as another, another huge market segment. If you're watching high def video from drones, it's not necessarily about the latency. It's about the bandwidth that you've got and how much data you can send.
Where is innovation happening at Vodafone?
Andrew Morawski: Look at the intersection of 5G and IoT. 5G is a true enabler of IoT. When I say 5G, I'm including narrowband IoT, which is again using a very low part of the LTE spectrum.
If you look at where those two intersect and what we're going to be able to bring to the market because of that, our focus is going to be around several key vertical market sectors. I already spoke about the automotive sector. Healthcare is a major focus for us. Manufacturing is a major focus for us. Again, I mentioned automotive.
If you look across the board, there are plenty of opportunities for Vodafone to move above and beyond just that commodity, connectivity player. That's where our focus is going to be as we move forward throughout the next few years.
Also: How Vodafone hopes to spur IoT growth by expanding Narrowband-IoT network TechRepublic
Narrowband IoT, I mentioned. We're doubling our narrowband IoT network deployments in Europe, I think from four to eight, just in this year alone. We're looking to build that Pan European low bandwidth IoT only network.
What about security in the 5G world?
Andrew Morawski: Concerns about security are one of the things that hold back a lot of enterprises. Think about corporate IT, if you think about you have 20,000 mobile connections; 1,000 wide area network connections around the world. Those numbers seem massive when you think about them in isolation, and they are massive when you think about them from an enterprise management perspective.
Take a step into IoT, and you then deploy 100,000 devices, 100,000 endpoints a month out in the field or out in a different area of your business. The security concern is massive.
You need to go into it with an open mind. You need to go into it expecting breaches. The key is planning how you mitigate those breaches when they happen. Again, with the sheer number of connections and the vast differences in types of devices being deployed all around the world, you've got to be realistic, but you've also got to have a plan to handle something when it does happen.
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