Adrian Dominic Ho, principal analyst at IDC Asia/Pacific, presenting the top 10 predictions for the telecommunications industry for 2014. Credit to IDC Asia/Pacific.
The rise of the 3rd platform — consisting of social, mobile, analytics/big data and cloud technologies — is pressurising telcos in Asia Pacific to move beyond their traditional connectivity business in order to stay competitive.
According to IDC, the traditional connectivity business will account for less than half of the overall business for telcos from 2014 onwards.
Moving forward, telcos will need to "rebrand themselves as the connected service provider build upon the foundations of cloud, analytics and mobility technologies," said Adrian Dominic Ho, principal analyst at IDC Asia/Pacific.
"However, telcos start from a position of strength because of their installed base of customers and the intelligence they derived from that relationship, which they can leverage and monetise via building that connected marketplace that will be worth more than a trillion dollars by 2020," Ho added.
Following are the top 10 predictions for the telecommunications industry for 2014 based on the latest IDC research and internal brainstorming sessions amongst IDC's regional and country analysts. These predictions represent major trends with either the most significant financial impact or long-term market impact across the Asia/Pacific region.
1. Cloud channels redesigned. New channel models that will allow telcos to scale faster are expected to emerge in 2014. This will include cloud brokerage, leveraging the enterprise channels to bundle both Infrastructure-as-a-Service (IaaS)/Software-as-a-Service (SaaS) with their enterprise customers core offerings and monetisation of the consumer cloud opportunity. IDC forecasts this market to be worth US$65 billion by 2020.
2. Value creation with B2B2C solutions. This model allows telcos to monetise each solution twice by working with their enterprise customer and the consumer who would consume solution through an "as a service model". This includes content and applications. IDC expects the retail, hospitality, tourist attractions, airlines and healthcare industries to be early targets for this model.
3. New frontiers with role based selling. Around 23 percent of Chief Marketing Officers (CMOs) in the region hold an IT budget, and this proportion is expected to increase in future. Telcos should thus consider extending their touch points beyond CIOs and network managers to CMOs and Line-of-Business (LOBs) by providing solutions to their interest. These offerings include IaaS, Business process as a Service, marketing applications and analytics.
4. Software-based IT to support innovation. IDC foresees telcos to focus on software-defined network (SDN) from 2014 onwards as they leverage SDN to launch cloud services, since networks can now be provision "as a service" and this can dramatically lower cost. For enterprises, the networks will become their competitive advantage as they can now launch new services more quickly.
5. Big data is monetisation's best friend. IDC predicts 2014 to be the year that telcos start monetising big data. Big data can be used as the depository for both structured and unstructured data. Telcos can also offer big data "as a service", implementing it for their enterprise customers, leveraging it for xCommerce/M2M services and possibly selling customer data to enterprises with laws permitting.
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