The big trends shaping telecoms in 2017

2016 was an eventful year for the telecommunications industry. UK residential and small business fixed broadband traffic grew by 40% in 2016, and mobile data traffic rose by 64%. As we enter the second quarter of 2017, here are four telecom trends that are shaping up to be big:

1. Consolidation of IT and telco

Vendors should keep an eye on the relationship between IT and telecommunications, which – given the rapid growth of cloud services and system integration – may soon be one and the same. International software giants have already begun to expand into telecommunications: Microsoft has done so with Skype for Business, and HP Enterprise has also made several forays into telecoms.

In 2017 onwards, the telecoms sector should expect this trend to continue – and for telecoms vendors to do the same, expanding and acquiring IT companies that can add value to their portfolios. An integrated ICT market will force vendors to continue to look beyond their comfort zone of selling for telecoms operators.

2. Wider fibre and 5G rollouts

One of the more predictable telecoms trends will be the introduction of higher-speed internet. The Chancellor of the Exchequer has committed to invest more than £1bn into fibre and 5G networks over the next four years, with the ambitious aim of rolling out 5G networks across the country by 2020.

Indeed, 5G will be the focal point for much of the telecoms industry’s interest – and this will manifest in further research and development, both within the industry and outside of it. Energy, transportation, and many other markets are also acutely aware of the promise that 5G networks hold for their businesses, and – in their relentless quest to deliver process and service improvements – will actively invest in developing this technology further.

3. The Internet of Things becomes profitable

While the benefits of faster internet are obvious, any investment in 5G will also speed up the advent of the IoT – and we should expect to see additional developments in this area over the course of 2017.

According to Gartner, we are likely to see some 21 billion devices connected to the IoT by 2020. This could potentially translate into significant gains for telecoms vendors – if they expand beyond their core products and focus on cloud technology, security, and the myriad other IT technologies that will only grow in importance over the next year.

4. Increased emphasis on security

Finally, it’s wise to expect further interest and investment in security – which has always been an important consideration. In the wake of several high-profile data breaches – with the 2015 Talk Talk hack perhaps being the ultimate example – it’s become more important than ever for telco customers to shore up their systems.

Last year, BT hired more than a thousand additional cyber security staff members, and Vodafone set up its own security department, which now sells technology developed in collaboration with BAE systems. Telecoms vendors should seize the opportunity: with communications and IT becoming ever more integrated they’ll be ideally positioned to offer superior security services.

These are only a few of the telecoms trends that are high on the agenda this year, but they’re suggestive of the industry’s future – one where it becomes faster, smarter, and ever closer to IT. The best vendors will capitalise on these trends – before the competition does.