How the IoT will Transform Telecommunications with the Magic of Connectivity
1. THE MAGIC TELECOMMUNICATIONS ROUNDABOUT
How the Internet of Things will be the driving force behind every interaction, and
what you need to do now to plan your journey.
INTRODUCTION
The Magic Roundabout(1)
is a complex junction in the city of Swindon in the UK. It is a series of small
roundabouts feeding a larger roundabout guiding drivers to multiple locations on a daily basis. This
metaphor is a perfect visual reference to the complex interactions that will be created in
Telecommunications by the Internet of Things (IoT), and how this emerging technology (2)
will transform
the industry as we know it. Communication continues to be at the heart of the continued growth,
innovation and development of the human race. As of today GSMA’s(3)
live tracker estimates that there
are 7.8 billion mobile phones globally and there are now more gadgets than people. At present a
significant number of these devices only communicate with other devices, over the next few years this will
change.
The days are gone when communication was linear, devices now act as a conduit and applications allow
us to communicate with each other in a variety of ways. With an increasing number of devices
connected to the internet IoT(4)
was born and we can now not only communicate with each other but
also with physical things and they can in turn communicate with us. We outline how the evolution of
telecommunications has led to the internet of things, creating a new route map for businesses. Helping
them to understand customer behaviour and build more meaningful relationships with customers and
how focussing on them rather than technology solutions will help you navigate this magic roundabout
effectively. In turn helping you create new and exciting growth opportunities for your business.
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2. A BRIEF HISTORY OF TELECOMMUNICATIONS
To understand where are going we need to understand how telecommunications has evolved, this
timeline does just that. Looking at the various inventions, innovations and milestones that have led us to
where we are now and will influence where we are going.(5,6,7,8 & 9)
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MOBILE CELLULAR TECHNOLOGY
1973 Motorola test first mobile phone
1979 First commercial 1G network in
Japan
1991 2G launched on GSM in Finland
1998 Launch of first 3G network
2001 First GPS phone
2008 First 4G network launched
2015 Verizon make IoT core to strategy
2020 Expected date of 5G network
TELEGRAPH
1838 - Samuel Morse publicly
demonstrates electric telegraph
1862 Railroad aides expansion with the
coast-to-coast telegraph line
1866 Trans-Atlantic cable successfully
connects US to UK
TELEPHONE
1878 Alexander Graham Bell invents
first telephone
1915 First transcontinental call
1956 First transatlantic telephone
cable
1838
RADIO
1901 First radio
transmission by Marconi
1923 First mobile two-
way radio in Australian
police cars
1937 Hindenburg disaster
broadcast live on radio
1937 Hings creates the
first walkie-talkie
MOVING IMAGES
1896 First movie created by Lumiere Brothers
1920 First moving image transmitted by John
Logie Baird
1929 BBC begin to experiment with TV
broadcasts
1936 NBC run first TV broadcast
1954 First colour broadcast in US
1955 Gibbs toothpaste First ever TV advert in
UK
SATELLITE
1957 Sputnik becomes first
satellite with a radio transmitter
1958 US Project SCORE
transmits Christmas message
1960 TIROS 1 transmits first
TV images from space
1989 Motorola satellite
communications launched
NETWORKS
1962 MIT conceive “galactic
network” ARPAnet is born
1973 Xerox develop ethernet
technology device to device
communication
1974 Transmission Control
Protocol the forerunner to
Internet Protocol is conceived
1989 Tim Berners Lee invents
the World Wide Web
1995 First internet phone
2015 Bosch remakes company
around IoT
1900
1930
1960
1990
2020
1860
3. LAYING THE GROUNDWORK
Telecommunications is arguably at the hub of the IoT. The challenge is to meld older communications
technologies with new whilst also planning for the future. Making the transition as seamless as possible is
essential as the demand over the next few years is expected to explode. According to Business
Information Intelligence (BII) by 2019 revenues from devices, services and software will be $600
billion(10)
. The old business model of just supplying a phone system is a thing of the past. Businesses and
consumers expect excellent customer service, to be solutions focussed with the latest technology at an
affordable price(11)
. The potential growth opportunities for businesses are only limited by their
imagination. Whatever the application here are two big areas, out of many, where this disruptive force
of the IoT will impact the telecommunications industry.
1. Big Data Business Opportunities
Big data, a term used frequently but rarely understood.
Essentially it is the process behind big data that drives business
opportunity. Only 8% of businesses are using more than 25% of
their IoT data(12)
. In fact some only use 1% the data they have
access to when 34% is actually relevant to the business(13)
. By
collecting the right structured and unstructured data, both internal
and external, the IoT will generate new business opportunities for
Telecom companies in understanding customer behaviour and
helping deliver more effective campaign marketing and fraud
prevention. Data-driven product development also offers lucrative
opportunities ahead, as demonstrated by Google and
Facebook(14)
. To take this further, Telecom companies can also
help other businesses innovate and deliver disruptive solutions as
part of their value added networks. An example is how a large
wireless company worked with Deloitte to gather data from a
number of sources to achieve real time marketing effectiveness(15)
.
2. Customer Service
With smarter technology Customer Service will become more
efficient through online digital experiences, service automation
and processing of financial transactions. Companies will have
clear insight through the data gathered from the connected devices
and technology, providing more tailored and proactive customer service. Systems are being developed
that can monitor and manage connected devices and provide the user with the ability to troubleshoot
problems directly. Eliminating a layer of human intervention to save time and cost(20)
. Through self-
diagnostic devices contact centres will start to deliver more proactive outbound service as opposed to
reactive inbound service. The integrated system will automatically trigger outbound calls to the customer
that can alert issues often before the customer even realises(21)
. As such, Telecommunication companies
have a significant role to play as leaders in Customer Service: from sales, implementing solutions, and
providing a full 360-degree perspective of the customer journey and micro moments.
TAKING THE ROUGH WITH THE SMOOTH
Whilst the opportunities the IoT provides are wide and varied from increased connectivity to commercial
benefits there are a number of risks and threats associated with it. The rapid expansion brings with it
opportunities for increased fraudulent behaviour and puts customers and the devices connected to the
IoT at risk(22)
. However, by understanding the risks below you can create new opportunities.
• Security Cyber crime is on the rise and any device can be hacked
• Privacy , data and CSR Businesses have a duty of care to protect customer info and do the right thing
• Equality and fairness Not all countries have the same regulations and high speed access
• Digital Divide Certain content, apps and services are limited in certain countries(23)
• Piracy Intercepting user information without consent such as surveillance or monitoring phone
conversations and messages(24)
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$11 TRILLION
IMPACT OF IoT ON GLOBAL
ECONOMY BY 2020
75%
OF COMPANIES
WILL ADOPT IoT
BY 2020
$4.1 BILLION
SMART HOME
MARKET BY 2017
ANALYTICS
NO.1 TECHNOLOGY
PRIORITY FOR CIOs
ACCORDING TO GARTNER
(16,17,18,19)
4. PLANNING YOUR JOURNEY
To navigate the magic roundabout and understand which part of the IoT is right for your business you
need to have a strategy. Outlined below are five common issues faced by businesses with an overview
of strategies to to answer the problem.
Having a strategy is one thing but you need a plan to successfully implement one. It helps you
understand why, how and what you need to do. The plan needs to include a scheduled set of actions
over a defined period of time. Defining who your customers helps bring focus to every activity, and
identifying the security measures to protect them is essential. Using data insights tools to understand
what your customers do will increase advocacy and improve engagement with them and ultimately
increase sales. PwC have recently stated that telecommunications companies need to monetise and
digitise their infrastructure. This can be achieved by identifying ways to understand customer trends and
reduce over-the-top (OTT) players piggybacking on platforms for free (25)
. Whilst creating an action plan
is essential constant review and stress testing the plan helps create a more agile business model, using
risk to improve business performance (26)
.
CONCLUSION
The IoT is changing the way businesses
interact with its customers and driving
significant growth in revenue. The US telco
company Verizon puts the value at $495
million in the past year(27)
. The pace of
change means businesses are playing catch
up. By using big data they can make
informed data driven decisions, radically
changing the types of conversations and
relationships you have with customers.
Understanding the risks and applying an
agile plan businesses will be able to drive
forward rather than trying to catch up.
WHERE NOW?
If you want your business to move up a gear
and understand how to adopt the internet of
things we can help. Working with you and
your teams to create your own route map
and help put your strategy into action. To
find out how visit G42.COM.
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REFERENCES
1. https://en.wikipedia.org/wiki/Magic_Roundabout_(Swindon)
2. http://forbes.com/simple-explanation-internet-things-that-anyone-can-understand
3. https://gsmaintelligence.com/
4. http://statista.com/iot-number-of-connected-devices-worldwide/
5. http://tcomou.blogspot.fr/
6. http://m-stat.gr/the-evolution-of-telecommunications/
7. http://adweek.com/socialtimes/history-of-internet-milestones/491279
8. http://wsj.com/articles/bosch-ceo-remakes-company-around-internet-of-things
9. http://verizon.com/state-of-the-internet-of-things-market-report-2016.pdf
10. http://uk.businessinsider.com/four-elements-driving-iot-2014-10?r=US&IR=T
11. https://storage.googleapis.com/think/docs/forrester-moments-that-matter-
research-study.pdf
12. http://mediapost.com/8-of-businesses-tapping-internet-of-things-data.html
13. http://blog.wigzo.com/predictive-analytics-101
14. http://deloitte.com-realtimedata
15. https://storage.googleapis.com/think/docs/forrester-moments-that-matter-
research-study.pdf
16. http://businessinsider.com/iot-ecosystem-internet-of-things-forecasts-and-business-
opportunities-2016
17. http://techtimes.com/11-trillion-potential-economic-impact-of-internet-of-things-
by-2025.htm
18. http://siemens.com/innovation/en/home/internet-of-things-facts-and-forecasts.html
19. http://solutionsreview.com/gartner-bi-analytics-top-priority-for-cios-in-2016/
20. http://businessnewsdaily.com/4858-internet-of-things-will-change-work.html
21. http://strategyand.pwc.com/perspectives/2015-telecommunications-trends
22. http://internet-of-things-research.eu/pdf/
23. http://internetworldstats.com/links10.htm
24. http://www.crime.hku.hk/cybercrime.htm
25. http://strategyand.pwc.com/media/file/Strategyand_Benefiting-from-Big-Data_A-
New-Approach-for-the-Telecom-Industry.pdf
26. http://ey.com//Turning_risk_into_results/
27. http://www.prnewswire.com/news-releases/verizon-simplifies-internet-of-things-to-
accelerate-adoption-300167701.html
ICONS www.freepik.com; www.flaticon.com
CURRENT PROBLEM STRATEGY TO FILL THE GAP
Who are our customers? Define your customer profiles
How secure are we as a business? Are our customers
at risk?
Understand the security threats, and implement
processes and procedures to prevent them
Do we have the right processes and systems to support
staff and delight our customers?
Establish a business ecosystem to meet and exceed
customer expectations
Do we understand or know our customers that well? Implement the right tools to track and analyse
customer insights
Have we defined the goals, KPIs and targets that will
help achieve our objective?
Use big data insights to understand customer
behaviour and help inform business decisions
We created a strategy and focussed on a fixed 3-5
year plan - is it still relevant?
Develop an agile approach to business planning
using foresight to fail fast, learn and growGAP