For 20
years, continuous technical transformation and information waves have driven
high growth in the telecom industry. However, an age with saturated telecom
penetration is coming, and telecoms industry is facing a brand new situation.
Looking to the next decade, how can the telecoms industry adapt itself to the
requirements of the new age in the changed environment? Through "Four
Surpasses", the telecoms industry will continue to achieve high growth in
the next decade.
Surpassing
population and developing new subscribers: The Internet of Things opens a door
to new opportunities
The
rapid development of mobile communication and the Internet facilitates the
approaching of a "global village". In some developed countries and
regions, mobile communication penetration rate has already reached or surpassed
100%. In the coming two years, the number of mobile subscribers will be up to 5
billion, and the network will cover over 80% of the global population.
However,
it is far from enough to achieve the connection of "human beings" and
utilize the intelligence of "human beings". Today, we are faced with
many common problems. For example, energy shortages coexist with massive wastes
of energy. According to research from United States Department of Energy,
electrical energy loss accounts for 67% of the total electrical energy
produced. Science and technology improves our lives, yet on the other side it
results in serious environmental pollution. Statistics from the Asian
Development Bank shows 20% of the global population lacks access to safe
drinking water, 50% of the population does not have adequate health care...
The
Internet of Things emerges under this background. The essence of the Internet
of Things is to apply information and communication technology (ICT) to
different industries, thus realizing "Intelligent Perception and
Intelligent Control" via the adoption of ICT and achieving the objective
of "efficiency improvement, scientific decision making, energy saving and
environmental protection, and cost savings" to promote the upgrade and
development of human society from an electronic society (E society) to a
ubiquitous society (U society).
The
Internet of Things describes an unprecedented blueprint for industries such as
telecom and IT. It is predicted that by 2020, the ratio between machine type
communications to human type communications will reach 30:1, which will allow
operators to extend their subscriber base from 6 billion people to 50 billion
or even over a trillion machines and objects, and thus opens a new door and
serves as the basis for "surpass population and developing new subscribers"
for the telecoms industry.
Surpassing
voice communications and developing new services: Mobile broadband contributes
to the industry's rapid development
The
revenue for voice services has saturated or even gradually declined with the
developments of mobile communication in the past decade. In the past five
years, the revenue for fixed voice services was reduced by 15%, and the growth
rate of mobile voice services decreased from 17.5% in 2004 to 1% in 2009 in
Spain. Even in emerging markets represented by India, the revenue per minute
(RPM) of mobile operators in 2008 fell 50% compared with the same period in
2007.
At the
same time, mobile broadband is entering a golden age of development, bringing
human society to a new height of ubiquity. The number of mobile broadband
subscribers will increase tenfold, reaching 3 billion in the next 5 years.
However, we still have not fully utilized mobile broadband, which depends on
the joint efforts of the entire industry chain, including "terminal,
network, and service". Although new network technologies such as HSPA/LTE are capable of supporting the cost
effectiveness of mobile broadband development, there are many challenges ahead
in facing the thousandfold traffic increase of mobile broadband for the next
decade. New types of smart terminals such as iPhone bring convenient
man-machine interactions, yet the high price of smart terminals is the biggest
bottleneck that restricts the popularity of mobile broadband. WOA technology,
represented by "Widget", can move Internet services and industry
services to mobile phones, greatly enriching the services and applications for
mobile broadband.
Currently,
an open ecological environment that includes "terminal, network, and
service" which centered on broadband experience is in an early form. With
the challenges of traffic and cost being overcome, it is predictable that
mobile broadband will become the most significant force to promote industry
development. Operators can achieve sustainable growth if they focus on
developing mobile broadband services rather than voice communications.
Surpassing
the pipeline, and exploring new business model: Cloud computing brings new
opportunities
The
popularity of broadband provides a basis for cloud computing. Cloud computing
appears in the form of an "information power plant", and is
overturning the traditional business mode of software, hardware, and media.
That is, users are moving from "buying products" to "buying
services".
The
change in the business mode is redefining the industry structure. By changing
the distribution mode of software to "terminal (iPod/iPhone) + application
(iTunes/Appstore)", Apple has surpassed Wal-Mart and become the largest
music distribution channel; Google is incubating a larger revolution to achieve
development, deployment, and operation of software and services through its APP
engine, with flexible expansion based on traffic through the cloud computing
platform and cloud storage platform at the bottom layer. In this case, there is
no need for software vendors and users to buy any hardware equipment or
platform software. This technology will overturn the sales modes of hardware
and software for companies such as IBM, HP, Microsoft, and Oracle.
The
development of cloud computing also brings opportunities for operators. On the
one hand, cloud computing has shown the significance of networks and thus
promotes network development. On the other hand, cloud computing services rely
on "secure and reliable" service providers, and "secure and
reliable" are exactly advantages of operators. Conversely, we always see
Internet service providers, no matter large or small, shut down Internet services
or even go bankrupt. If operators enter the cloud computing market, they can
form new services and experiences based on secure and reliable mass computing
storage by integrating industry contents and applications in the digital
supermarket mode, provide customers with new values, and give full play to
operators' networks and subscriber advantages. In addition, by utilizing
reliable and enormous user assets obtained through customer locations and user
experience, operators can employ new business models and cultivate new revenue
streams through building data mining and advertisement platforms.
The
market for cloud computing will move into a rapid development phase, with the
market size exceeding 200 billion USD in the next five years. Cloud computing
will be the key for business development for operators, to realize
"extending network value by surpassing the pipeline".
Surpassing
telecom and extending to other industries: The revolutionary experience of home
networking creates new markets
It is
well known that the new experience of "digital music" and music modes
like MP3 overturned the CD and music distribution industry; that is, the
revolution of the user experience overturned an industry. With the increase in
broadband penetration, what kind of revolution of user experience will home
networking bring? Which industries will be overturned?
Let's
look at the composition of home networking. The first is an audiovisual
entertainment network dominated by a "TV screen". The second is a
communication network dominated by PCs and mobile phones. The third is a sensor
network. The fourth is a video surveillance network. The fifth is a home
network. The sixth is an interconnection and control network. Among the six
components, the TV screen is the first to experience revolutionary change.
"On-line and On-demand" will bring consumers a brand
new service experience. Consumers can freely select contents, releasing
themselves from a rigid schedule. The brand new service experience will
overturn the video industry dominated by "broadcast and DVD".
Microsoft
CEO Steve Ballmer said in June 2009 that traditional media would disappear
within 10 years, being replaced by Internet-based content. EU pointed out in
"Internet of 2020" that by then, TV channels are distributed as other
Internet services, and do not need terrestrial or satellite broadcasting
anymore, except in isolated areas. If the past decade witnessed the convergence
of telecom and the Internet, the next decade will witness the convergence of
broadcast, TV, and the Internet.
Home
networking is the major battlefield for "network convergence of telecoms,
TV and the Internet". The "bi-direction and high bandwidth"
features of the telecom network have an advantage in network convergence, and
provide unprecedented strategic opportunities for operators to "surpass
telecom, and enter into new industries".
Looking
forward to the next decade, "four surpasses" will help operators
break the ceiling of "population, voice, pipeline, and industry", and
bring the telecom industry to a new height. However, it takes a long, hard time
to achieve "four surpasses", especially faced by the hundredfold
increase in network traffic brought by mass terminals and mass digital contents.
The
traffic of mobile networks will increase a thousandfold, bringing unprecedented
challenges to bandwidth and cost. Huawei will innovate products, services,
architectures, and technologies as always, develop a future-oriented single
network strategy to support growth of future services, and promote sustainable
development for the entire industry.
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