get telecoms smart - mobile world congress 2017

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Mobile World Congress 2017

G E T T E L E C O M S S M A R T

Mobi le World Congress 2017

Mobile World Congress 2017 was as big as ever—with a record breaking 108,000

attendees1. It’s an event that garners enormous attention but this year the consensus was

that the content was underwhelming and fell far short.

MWC is arguably the telecoms industry’s CES, we all eagerly await the announcements of

new launches and industry developments but this year, many of the topics were nothing

new; 5G and virtual reality were key themes, but the same was true of last year’s event

and neither has been executed well since. In fact, there was no single announcement that

significantly impacted the way in which the industry functions; instead, the suggestion

was that there was a lot of conformity.2

Yet if you really look at the past year there has been a noticeable evolution and

advancements are being made to prepare the industry for greater changes to come. This

year we became increasingly aware of what could be possible at the intersection of

mobile with connection, content and technology. The slowing in technological

developments actually made way for an important but perhaps less sexy discussion

around what role telcos could potentially play in consumer’s lives in the future, if they

focus on creating genuine value for users beyond their core business.

“It’s the customer’s world, and we are just living in it. It’s a big

pivot and we need to get comfortable feeling

uncomfortable,” - John Stankey, AT&T3

For us this debate, whilst less headline grabbing, is incredibly significant and important, as

it shows that telcos have a real opportunity to cement their purpose in the value chain,

but they will need to find growth and progress from within their own organisations and

customer relationships rather than chasing new, shiny technology to lure consumers in.

Telcos will need to practice what they preach in embracing digitalisation in their own

practices, innovating with how data can be used to best serve the consumer and

exploring the extent to which users actually want to interact with them. There was some

evidence at MWC of this; telco brands such as Telefonica and Veon (previously

Vimpelcom) are experimenting with improvements to the customer experience; and other

telcos are looking to enhance their content-producing capabilities in order to enhance

their offerings.

1 Mobile World Congress (https://www.mobileworldcongress.com/start-here/2017-event-highlights/) 2 The Economist: https://www.economist.com/news/business/21718004-more-black-rectangles-made-their-debut-barcelona-conformity-nostalgia-and-5g-mobile 3 http://www.hollywoodreporter.com/news/at-t-entertainment-ceo-touts-rising-importance-content-980979



Here’s what you need to know about MWC 2017:

CONSUMER EXPERIENCE

While there is a lot of potential in the future development of technology, telco operators

must focus on what they can offer consumers now in order to build relationships. With the

agility and prevalence of OTT providers, telcos stand to lose business from consumers

who do not see the benefit in their service.

“The telco’s not on your mind. And nor should it be. But

there’s an opportunity to have a different relationship with

the people that are using your service to connect and talk.”4

One service provider taking this seriously is Veon. The telco is developing a consumer-

facing app in partnership with musical artist/tech entrepreneur Will.i.am. Veon hopes its

multi-purpose app, which gives consumers more control over their service, will move their

relationship beyond pure connectivity.

Telefonica has also made advancements in building the customer relationship, seeking to

be more transparent with consumers regarding data through the release of a new AI

digital personal assistant called Aura. This is an initiative that directly addresses a user

concern and enriches the overall experience from the provider, something that creates

differentiation and genuinely improves the customer experience. A very welcome move

from a telco.

HARDWARE

Devices were a focus, as always, but as the market matures, improvements were far from

noteworthy, we saw minor developments around display enhancements, camera

capabilities and design quality. Ovum analysts suggest that with the changes in hardware

being so incremental, the focus has now shifted to software, service and branding.

Nokia stole the show by re-launching its beloved Nokia 3310, the first phone of practically

an entire generation. The backlash from the ultra-connected world made this “digital

detox” device, which has no internet capabilities, the talk of the event, garnering more

attention than other smartphones which Nokia also, quietly, launched.

4 Campaign, Will.i.am



Other retro phones launched included the Blackberry KEYone, complete with the

recognizable physical QWERTY keyboard and also the Light Phone, a simple phone that

can only make and receive limited calls. The appeal of these is the simplicity and relief

from our hyper-virtual-connectivity, but we will be interested to see if the enthusiasm

translates to sales.

5G

5G continues to dominate the headlines: GSMA announced that 5G is expected a year

earlier than predicted, but this is still a few years away. The GSMA lobby group signed on

to an effort to get 5G ready for commercial deployment in 2019, a year ahead of schedule,

and predicts 1.1 billion 5G connections by 2025.5

Vendors have certainly been showing off their technological prowess but everything so

far is provisional as much still needs to be “invented” to make 5G a reality. “The 5G

standard is still emerging. Expect an evolution — not a big bang revolution” saysDan

Bieler, a telecoms analyst with Forrester. Mobile carriers will, for instance, have to rejig

their networks to make them more like a “computing cloud”.

Service providers seem to be up for the challenge, they know evolution is critical for

survival but Ovum Analyst Daryl Schoolar noted that as of now “progress is being made

with the advancement of 5G but the applications remain vague and lack original thought.”

Still much to do to live up to the promise.

PARTNERSHIPS

We continue to see many telcos creating partnerships as a way to provide exclusive value

for subscribers. Operators know that they need to stay relevant in regard to the services

delivered through their network. John Stankey, CEO of AT&T Entertainment Group,

shared his vision: “We just cannot envision a future where AT&T is relevant if we don’t

directly participate in some of the water flowing through our pipes.”

The big name partnerships are coming in the form of content. Vice media & Netflix are

both entering partnerships with telco operators and both gave keynote speeches at the

event this year. Though content producers have seen industry growth the past few years,

they also know that working with telco service providers offers a unique opportunity to

gain access to new users.

5 Bloomberg: https://www.bloomberg.com/news/articles/2017-02-27/deutsche-telekom-ceo-presses-regulators-on-m-a-5g-to-aid-growth



“Netflix is doing what it needs to do, solely focused on

content. But it needs scale, and this is where the telcos come

in, especially those that do not want to invest sums in

securing costly content rights.”6

Additionally, Netflix CEO, Reed Hastings encouraged operators to offer tariffs that allow

consumers to watch unlimited amounts of video without additional data charges.7

THE FUTURE IS BRIGHT…

Steps are being taken to pivot the mammoth industry, Operators know that there are

opportunities in content, connection and media, but in order to fully harness these, they

need to be open to new business models. Shane Smith, CEO of Vice Media proclaimed

“It’s probably the most exciting time to be a mobile carrier. The guys that used to lay

cables are now going to be creating the most exciting content in the world.”8 Ovum

predicts that the future does not lie with legacy telcos, broadband or even smartphones

but instead in the digital consumer and strategic enterprises.

The entire industry will continue to revolve around the consumer and their experience of a

network. Such a cutting edge industry may have to move quicker to bring about new

ideas to improve the customer relationship as well as bring revenue for the operators.

Telcos can learn a lot from the agile start-ups that they partner with: take risks, fail fast

and be open to truly transformative ideas.

6 Fortune, Netflix CEO Reed Hastings: http://fortune.com/2017/02/27/netflix-ceo-mwc/ 7 Ovum, MWC 2017 Highlights: Day Two 8 Marketing week: https://www.marketingweek.com/2017/03/01/vice-mobile-world-congress/



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Kelsey Gardner, Senior Strategic Planner, [email protected]

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