The first article in this series discussed why telco operators need to reinvent themselves. In short, there are significant opportunities in both consumer and enterprise domains, but operators need to transform their platforms to address these new opportunities in an increasingly competitive environment. Despite the entry of hyperscalers in the telco domain, telco operators have the experience, physical assets, and technology expertise that no other entity has in the market. For example, current 5G cell sites are set up to transfer more than 200 Terabytes (TB) per day, a monumental feat considering any network, let alone wireless. In the fixed broadband space, connections transfer TB worth of data every day for consumers, especially if we consider 4K content and immersive applications. These require significant expertise that only telco operators possess.
The following market trends came from ABI Research’s Smart Apartments and Multiple Dwelling Units research analysis report.
Smart home technolgies have traditionally been offered by providers to homeowners in the Business-to-Consumer (B2C) space. However, within the last 5 years, there has been a shift toward offering smart devices and software to apartment owners/managers, with a Business-to-Business (B2B) marketing angle. The age of smart apartment solutions is well underway.
While many industries felt the intense ramifications of the global chip shortage, the government issued ID space has been mostly spared because vendors recognize the importance of citizens obtaining proper IDs and because the market is contract-based. Plus, the demand for IDs hasn’t exactly been soaring given travel restrictions, which is the driving factor behind purchasing a passport. However, as restrictions lift and people begin to travel and go out more, demand for smart ID cards will increase, presenting an emerging challenge in a world where chip supply isn’t expected to fully recover until late 2023 at the earliest.
Although the world is gradually crawling closer to a full escape from the clasp of COVID-19, some of the effects of the pandemic are still being felt in supply chain logistics. As a result of lingering issues, such as labor shortages and port holdups, suppliers are still struggling to meet satisfactory delivery windows.
The market for consumer head-mounted displays (HMDs) will see 90.1 million shipments by 2027, growing at a Compound Annual Growth Rate (CAGR) of 36.1%.The development of Virtual Reality (VR) for consumer entertainment dates all the way back to the 1980s and 1990s, but adoption has never taken off in a meaningful way until now. ABI Research forecasts that the total VR industry, including hardware, software, and services will be worth US$95 billion in 2027. Some enterprise markets are also seeing significant growth, driven by value in training and simulation, but consumer makes up the majority of the VR market.
In 2021, the global cold chain track and monitor telematics technologies market size was US$286 billion, according to ABI Research. By 2027, the cold chain telematics industry will be valued at over US$700 billion and growing at a Compound Annual Growth Rate (CAGR) of 16.6%. As 20% of perishable goods are wasted during shipping, cold chain logistics managers are turning to technological solutions to monitor shipped goods.
By 2025, global spending on pharmaceutical (pharma) products will reach US$1.6 trillion, according to a report from IQVIA. And that doesn’t even include the current US$220 billion spent on chemicals, raw materials, excipients, and other Active Pharmaceutical Ingredients (APIs) that are needed to produce finished medicines. This demand, in tandem with a strict regulatory environment, necessitates the need for Internet of Things (IoT) technologies that provide rich data and analytical insight into logistical operations.
With climate change being at the forefront of the public’s conscience, telecommunications operators and vendors need to look for innovative ways to conserve energy. Although 5G is 90% more energy efficient per unit of traffic than 4G, it still requires substantially more overall energy consumption—from heavy traffic load, Massive Multiple-Input Multiple-Output (mMIMO), Radio Access Networks (RANs), and cell site capacity. For example, a 5G base station needs 3X more power than a 4G base station.
The telco market is experiencing a tremendous amount of activity with fierce competition within the traditional mobile network market from new entrants, open networks, and hyperscaler services. Meanwhile, the boundaries of the reach of each company are blurring. Telco network operators are at the center of this competition, but ABI Research believes their position is ideal to let them become much more than they are today. They have the technology and platforms to do so, but have yet to capitalize on them. They also have long-time excellence in customer experience management and are very familiar with direct, personable, and high-value contact with end users.
