The Future of Telecom: A Dual Transformation

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The future of the telecommunications industry is becoming increasingly unstable and uncertain due to the increased customer demand changes, rapid innovation of technology and regulatory. For those prime players in the industry who support and embrace disruption, reimagining network service capabilities are offered better opportunities than never before. This includes every major and significant player of the telecommunications industry in the United States like AT&T, Verizon, Sprint, T-Mobile, Charter, and Comcast.

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American telecommunication players like CenturyLink and Dish have begun to initiate and embrace a customer-oriented dual transformation. The first transformation of this initiative involves redesigning the core network business to a more customer trust network. In doing so, it maximizes its resilience accompanied by simultaneous ability to offer value career grade services. The second stage of transformation involves creating specially designed search engines that leverage the reconstructed core business services to deliver tailored network services to meet the needs of the emerging public, consumer, wholesale customer needs and private enterprises.

The Future of Telecom or FoT is based on the endless capabilities that could be offered by innovative and not so far away technology of 5G. The Fifth Generation or 5G possess potential abilities of wireless technologies and plan to build the FirstNet carrier-grade public safety network alongside with rapidly evolving customer needs of IoT or Internet of Things services and service models.

The peculiar aspect observed in the industry is the fact that instead of focusing on this potential growth, a majority of the industry analysts are concentrated on attaining market equilibrium through industry consolidation. Industry consolidation can be done through horizontal consolidation by Sprint and T-Mobile, cross-network platform consolidation by Verizon and Charter, Sprint and Charter or Sprint/TMUS/Comcast/Charter and vertical acquisitions by AT&T and Time Warner. Most financial analysts focus on the sustainability of dividend payments along with its ability to refinance debt on favorable terms as two of the main important aspects of support mechanisms for the current valuations of telecom companies.

There is significant economic pressure to drive and lure the cash flow generated to cover dividend obligations, debt payments, and pension obligations and focuses on investment in real growth is more vital. Carriers have an immediate but not definite opportunity to improve growth through the development of carrier-grade and virtual network services that can be made available to emerging customer needs. This service based system can pave the way for U.S telecom giants to grow beyond their physical platform constraints to a more narrow geographic focus. This impeccable strategy offers growth opportunities for incumbents in other markets to grow and thrive.