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With IoT Connectivity Becoming a Commodity, Telecommunications Operators Must Differentiate by Developing Ecosystems that Support Industry-specific Solutions
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Telecom operators across the world are challenged by commoditization of connectivity and continuous decrease in revenues from fixed and mobile telephony. The situation is no different in Europe. The market in Europe is characterized by high internet penetration and over the years as the cost of sensors has declined, the affordability and viability of IoT-enabled devices and services has increased steadily. The region needs an infrastructure that can meet these changes in demand. As 4G, 5G, NB-IoT, LTE-M roll-outs are prioritized, operators are looking to augment their current offerings with IoT-enabled products and services. Operators in addition to enhancing their infrastructure capabilities are also exploring new revenue streams as IoT adoption grows across consumers and enterprises. They are offering vertical specific solutions, partnering with other companies in the IoT ecosystem to augment their offerings with capabilities in advanced technologies such as Cloud, artificial intelligence (AI), machine learning (ML), big data analytics (BDA), and Blockchain. Their efforts are visible in their infrastructure development plans, partnerships with innovative technology companies and customers for pilots, and investments in enhancing their own capabilities. Many operators have set-up dedicated units for IoT which provide connectivity and also IoT-enabled products and services. Other initiatives include investment funds, accelerators, partnering with academia and governments to identify innovative solutions and explore new opportunities. While IoT offers a plethora of new business opportunities, it comes with its own set of challenges, such as data privacy and network security. Cybersecurity, data management and vertical specific solutions have emerged as opportunities where operators can differentiate themselves. Data from users is an extremely crucial to identify the right applications that are likely to grow in the market. Operators have access to consumers and they can use that to further their presence in IoT market. However they must meet the governing and regulatory standards that govern this data. This research will outline:• The key components in an IoT ecosystem• The strategies deployed by European telecom operators to develop their IoT ecosystems• European telecom operator profiles • Growth OpportunitiesThe study is illustrated with numerous examples of to indicate the approach of European telecom operators to developing IoT ecosystems. Some of the operators having recognized IoT as a rapidly growing segment and its significance in their future plans are reporting IoT revenues separately. The advent of IoT also means that operators can utilize the new capabilities to charter into other industries such as financial services with PayTech offerings, or logistics with asset tracking solutions. The promise of impact of IoT on verticals such as healthcare, finance, or agriculture creates opportunities for core companies in these industries to work closely with telecom operators. Future plans of European telecom operators indicate their confidence in the ability of IoT to add value to their portfolio of products and services.
Key Issues Addressed
Author: Deepali Sathe
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