SPECIAL REPORT 2017 TRENDS

2017:

OPPORTUNITIES
UNLIMITED

The year 2017 has the potential to be a game changer for telcos and technology providers
who take advantage of the opportunities in hand and collaborate
for a connected, and secure world

s operators and internet service

providers make great headway in
giving subscribers the ultimate
user experience with faster, more
qualitative and cost-effective voice
and data services, Daniel Kurgan, CEO of BICS,
believes that 2017 despite its imminent challenges could prove to be a turning point for the
industry as a whole, with new revenue opportuni-

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ties and partnerships to be reaped for those who

have readied themselves to take advantage.
Looking back at the year 2016, it was good for
telecoms. While operators struggled with nding
newer sources of revenue generation, technology vendors made sure to maintain the spark of
innovation to drive digital transformation. While
voice remains one of the biggest revenue streams
for MNOs, the digital revolution has sparked a

CommsMEA January 2017

new age for communication. New digital experiences like messaging apps, chat bots and even the
Internet of Things have pervaded mobile devices
globally, as consumers expect instant connectivity and seamless services, wherever they are in
the world. As we enter the new year, CommsMEA
spoke to several industry experts to forecast the
trends for communications technology for the
year that lies ahead of us.

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SPECIAL REPORT 2017 TRENDS

5G technology guarantees more speed, reliability and eciency which are essential requirements
for Smart Cities built around Internet of Things,
self-driving cars and other innovative use cases
that might not have been even thought of yet.

TRENDS THAT ARE

GOING TO RULE 2017
INCREASING SMARTPHONE
ADOPTION
This has led to a tremendous increase in the data
traffic. This trend will continue through 2017. Operators will need to make the network infrastructure ready for such traffic growth. Operators in
MEA have already launched LTE-Advanced 4.5G
networks in the last couple of years to cater to the
tremendously increasing data traffic. Further, Aji
Ed, head of technology, MEA, Nokia believes that
operators will look to launch the ultra-fast LTE
4.5G Pro and 4.9G networks in 2017 and beyond
and carry out 5G tests to prepare themselves for
the data deluge in the coming years.
Rainer Schnepeitner, regulation affairs and
competition department manager, CRA Qatar
says: Currently the industry is faced with a mega
trend fast data everywhere. This trend has enabled completely different life styles and new business models, where international players provide
excellent services to the end customer. I see this
trend continuing and accelerating in 2017.
Fuelled by streaming applications like Netix,
bigger smartphone screens, and a drive by social
media to integrate video, accompanied by the
sheer speed of 4G, consumers clearly cant get

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enough of mobile video content. Ericsson said in

its most recent Mobility Report that video will account for two thirds of all mobile data traffic and
will grow by around 55 per cent annually through
to 2021, with social networking forecast to grow
41 per cent.

DIGITISATION
The need and pressure for digital transformation
is denitely going to be a dening trend of 2017.
Digital will continue to expose both new opportunities and risks. The pressure to eradicate
costs, standardise processes, reduce variables
and reshape the business to run more efficiently

SECURITY

CLOUD

BIG
DATA

$243
billion

ICT spend
in the META in 2017
(Source: IDC)
MEDIA

CommsMEA January 2017

make digitisation even more urgent, says Wael El

Kabbany, vice president for the Middle East and
North Africa at BT.
He further adds that more organisations have
started to fully embrace cloud services, recognising the cost-cutting and agility-improving
benets that they provide. We expect to see an
increase in the uptake of such services in the
coming year, with the cloud becoming the universally accepted new normal. In a bid to differentiate, cloud providers have recognised that they
must have the right partners embedded in their
cloud. Were going to see more cloud providers
take steps to attract new partners to their communities.

SOCIAL

Security will continue to remain a prime threat,

especially given the increasing exposure induced
by digitisation. El Kabbany says: Looking ahead,
well benet from more intelligent networks that
are literally security aware, able to independently detect and deal with vulnerabilities, and alert
adjacent networks.
Hackers are motivated by various factors these
days and securing an organisations vital data
assets will continue to be a major issue in the
years to come. A robust cyber strategy, centred
on threat intelligence and penetration testing, to
check for weak points in the IT ecosystem, will

39

SPECIAL REPORT 2017 TRENDS

undoubtedly help in combating the latest generation of cyberthreats, says El Kabbany.

PUBLIC SAFETY

Gartner predicts that digital

experience and engagement will
continue to draw people into
nonstop virtual interactions.

Operators have started realising the importance

of public safety solution in MEA, and some leading operators and government agencies have already deployed the LTE for public safety system.

SMART CITY TECHNOLOGY

Smart city concept has been gaining momentum
in MEA especially in countries like the UAE,
Saudi, Qatar, and South Africa.

INTERNET OF THINGS (IOT)

GSMA estimates that there will be nearly 20
billion M2M connections needed for IoT by 2020.
Developments toward 5G commercialisation
are paving the way for IoT. Eid expects to see IoT
deployments picking up in the region from 2017.
2017 will witness more convergence across
the telecoms space as service providers develop
cross-platform propositions to support content
services, and also look to diversify in order to
target vertical markets, according to Daniel Kurgan, CEO of BICS. The IoT will be a key driver of
this transformation, as an increasing number of
industries become reliant on mobile to provide
the connectivity and infrastructure needed to
support IoT implementations.

CUSTOMER IS KING
Customer experience management is a crucial
area among operators in this year and coming
years as customer experience decides customer
loyalty. CEM came to the fore as the highest
priority for operators going forward, according to
Mahindra Comvivas The business of tomorrows
report. 27 per cent of respondents putting this
ahead of other key metrics like big data, cloud
computing, network function virtualisation and
BSS/OSS transformation.

EMPOWERING EMPLOYEES
IT Trends for the coming years, including 2017,
will be focused on how to further empower
employees to use the tools they nd best and
most convenient at work, according to Charbel
Khneisser, regional pre-sales consultant manager, Middle East, Turkey & Africa at Riverbed
Technology. As technology has become an integral part of our personal lives, peoples mindsets

40

and demands have shifted drastically and their

expectations from ICT infrastructures is that
they need to be application driven.

CHALLENGES OR
OPPORTUNITIES?
Many countries in MEA have started to deploy
LTE. However, according to Eid of Nokia, lowcost LTE capable smart phones are quite crucial
for the success of LTE in emerging markets.
Indoor coverage is an issue that is faced by all
operators in the region. This is where Nokia can
support with best-in-class Nokia Flexi Zone
small cells for solving indoor coverage issues.
Spectrum scarcity is another topic that telcos
need to take care of together with regulatory
authorities. In order to meet the capacity needs
of the future, additional spectrum is mandatory.
Especially, while looking at 5G, more spectrum is
needed to be made available in cmwave bands like

CommsMEA January 2017

24.5GHz 27.5GHz.
The surge in the demand for mobile internet
will create remarkable opportunities for telecom
operators. The challenge that telcos will face however is in behaviour shift of customer base centred
around end-user experience. Customers loyalty to
their telco provider will be strongly tied in to the
quality of service for their mobile data access.
Khneisser says: Carriers will have to rethink
their network architecture for better coverage,
quality, and capacity. This can only be achieved
via the adoption of technologies such as Software
Dened Networking (SDN) and Network Function Virtualization (NFV).
The Business
of Tomorrows survey
by Mahindra
Comviva found
of operators believe CRM
that one-third
is the biggest priority
of the operators
Source: The business of
tomorrows survey (2016)
are concerned

27%

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SPECIAL REPORT 2017 TRENDS

about future CAPEX and OPEX related issues,

associated with new technology investments and
network upgrades. According to a recent report by
PwC, telcos could be wasting up to 20 per cent (the
equivalent of $65 billion) a year in capex, with the
process internally deeply awed. Customer retention (31 per cent) was cited as the second major
concern, ahead of spectrum availability, issues
related to backhaul and fronthaul networks, and
network availability.

GROWTH FORECAST FOR 2017

Many operators in Middle East have already
deployed LTE. Aji Ed, head of technology, MEA,
Nokia believes this will evolve further with 4.5G
which will improve the throughput to around
600mbps with carrier aggregation of up to 3 LTE
carriers. In 2017, the major growth will be driven
by data and further, operators need to increase

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In order to meet the

capacity needs of the
future, additional spectrum is mandatory. Especially, while looking at 5G,
more spectrum is needed
to be made available in
cmwave bands like
24.5GHz 27.5GHz.
Aji Ed, head of technology, MEA, Nokia

the throughput more by deploying 4.5G Pro with

up to 3 carrier aggregation with 4X4 MIMO. This
will enable the speed of 1Gbps per base station.
Nokias 5G ready AirScale base station is the most
efficient platform to deploy 4.5G network. In 2018
and beyond, we expect to see 4.9G picking up with
a speed of 2.5Gbps and above. 4.9G will have upto
5 carriers aggregated with massive MIMO. Nokias
AirScale platform is designed to support 4.9G.
Though, 5G commercial availability is expected
around 2020, telcos have already started 5G planning and tests. In 2018, Korea winter Olympics
will see the rst
mobility use cases
of 5G implemented
using pre-standard
IoT revenue
systems. 5G comopportunity by 2025
mercial systems

$3 trillion

CommsMEA January 2017

We are helping telcos

move away from proprietary hardware-based
network equipment to
software-based network
functions leading to
much more ecient and
effective networks.
Charbel Khneisser, regional pre-sales
consultant manager, Middle East, Turkey
& Africa, Riverbed Technology
are expected to be operational by 2020 Tokyo
Olympics. In the Middle East, telcos are making
plans for 5G deployments in 2020 and beyond.
First deployments of 5G in the region are expected
to be around major events like Expo 2020 in UAE
and world cup event in Doha in 2022. Vendors like
Nokia, Ericsson and Huawei are already collaborating with all the major operators in the Middle
East to help them getting ready for 5G.

WINNING STRATEGY
Needless to say, as the popularity and usage of
internet communication tools such as WhatsApp, Viber, Skype, keep rising, will dramatically
impact the traditional voice and SMS revenue
streams of telecom operators. In order to main-

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SPECIAL REPORT 2017 TRENDS

tain their protability in such a market, telcos wil

need to redene their approach.
Khneisser of Riverbed Technology explains
with an analogy. This is reminiscent of what
happened to the banking sector in the 1970s when
their revenue generating income was mostly from
various types of loans. They managed to adapt to
new spending models through innovation. Credit
cards are still a form of loan but packaged to
meet 21st century users demand. Telcos need to
replicate such innovation as currently, they have
failed to repackage their legacy services.
The driving strategy for telcos should be
around data usage and cloud adoption. They need
to package services and products around these

Communications solutions going forward will

increasingly be a hybrid
solution combining bre,
wireless networks and
satellite, as no single
technology or company
can reach all the possible
markets and customers
that will be available in
the future.
Jean-Philippe Gillet, VP EMEA, Intelsat

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to meet the needs of their customers. Telecom

providers are ideally positioned to enable communication and collaboration and they need to
leverage this to their advantage.
Khneisser further adds that telcos should promote more cloud adoption and help their install
base take the route of Software Dened WAN
(SDWAN) through a managed services contract.
Moreover, telcos need to start building a more
granular charging function mechanism that supports billing users by type of data usage such as
VoIP apps, social apps, instant messaging apps, or
business apps. This approach will help telcos shift
from being only a simple data channel provider to
charging based on service usage.
In the midst of the prevalent economic climate
in the region, organisations are under pressure to
increase their bottom line and nd new avenues
of growth. This is where big data and data analytics come into play. Only by leveraging the opportunities afforded by big data will telecom rms
be able to tap into new customer groups, provide
best-in-class services to their existing customer
base and stay ahead, El Kabbany says. He further
emphasises the need to maintain a lean and
efficient organisation that not only knows how
to respond to its customers in real-time, but also
facilitates seamless interaction within its workforce is the key to success. Thus, digital transformation and opting for a digital rst strategy
can make all the difference between success and
failure. Making this anything else than a top
priority is a sure way to get left behind.
The fear of the traditional telcos is to be
degraded to a dumb pipe, providing connectivity only and losing the customer connection.
Countering this, Schnepeitner says there is
nothing wrong in providing a superior connectivity service. Firstly, economic theory suggests
that focus will lead to more efficient production
and cost saving. Secondly, experience from other
commoditised utilities shows that the business
model of a pipe can protably work. Thirdly
none of the diversication endeavors of telcos
have ever worked. I recall a myriad of very expensive and failed WAP portals, content creation
platforms, dabbling in the movie business, music
platforms and the like. Its simply not in the DNA
of the telcos, not they have the relevant resources
or possibility to roll these services out worldwide, which would provide economies of scale.
Fourthly, connectivity and last mile will not be

CommsMEA January 2017

By

Maintaining a lean and

ecient organisation that
not only knows how to
respond to its customers
in real-time, but also facilitates seamless interaction
within its workforce is the
key to success.
Wael El Kabbany, vice president, Middle
East and North Africa, BT

provided by OTTs, therefore telcos will have a

steady stream of revenue and prot. Finally, its
already reality and one can only try to defy gravity. He recommends that the way forward is to
accept this reality, form alliances and implement
revenue sharing models.
Niranj Sangal, CEO, OMA Group believes
that telecom operators along with banking and
nancial services sector together can play a major
role in enabling citizens to adapt the government initiatives which are focused on digital
transformation and furthering mobile payments
economies. Companies that have the expertise
and are able to provide innovative solutions such
as e-KYC, peer to peer cross border remittance
using blockchain technology, Mobile Point of Sale
acquiring will stand to gain tremendously. These
companies partnering with telecom operators

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SPECIAL REPORT 2017 TRENDS

2020, 95 percent of all workloads in Middle East and Africa will be processed in the cloud, compared to 78% in 2015 (Source: Cisco Global Cloud Index)

In Africa, the biggest

challenge for the telecom
sector is to be able to
cover the population and
geographical areas with
both Internet and mobility thereby connecting
people. Payment solutions can then use a
mobile infrastructure to
provide services.
Niranj Sangal, CEO, OMA Group

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will enable the banking sector to move towards

digital and mobile transformation especially in a
fast pace growth market such as Africa.
He recommends telcos to invest in mobile payment systems to reap the advantage of tremendous opportunities in the sector. However, the
industry must also work towards covering larger
populations with Internet and mobile networks
and coordinate them to facilitate and guarantee
interoperability for such solutions.
The importance of ongoing training and
development cannot be stressed enough. At the
moment, the Middle East is facing a signicant
shortage of highly skilled technology professionals.
Providing continuous training and development is
the only way to pre-empt this issue and ensure that
the IT operations of the future, be it data analytics
or cybersecurity, will be in good hands.
Jean-Philippe Gillet, Intelsats VP EMEA says
the telcos should focus on making their networks future-proof so they can react quickly to
changing end-user demand. Our move toward
managed-service models will expand hybrid
network solutions. This approach will allow our
customers to reduce their capital expenditures
and redirect resources and manpower toward application development that will bring new traffic
on their networks.

NO LOOKING BACK
Going forward, its recommended that the
telcos continue their technology investments
and increasingly go for strategic collaborations

CommsMEA January 2017

Connectivity and last

mile will not be provided
by OTTs, therefore telcos
will have a steady stream
of revenue and prot.
Finally, its already reality
and one can only try to
defy gravity. The way
forward is to accept this
reality, form alliances and
implement revenue
sharing models.
Rainer Schnepeitner, regulation affairs &
competition department manager ,
CRA Qatar

and partnerships with content and other value

added service providers to provide a rich digital
experience to customers. Customer experience should continue to be the prime driver of
projects and telcos should make best utilisation of big data analytics to deliver personalised experiences, reduce churn and enhance
protability. Any kind of change is tough; but
then the ones who face the challenge have the
potential to emerge victorious and grab a giant
share of the digital pie.

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