Disruption, innovation & connectivity at MWC

Insights and reflections from Paul Clayson, RP International’s Head of Executive Search, APAC, and Dominic da Costa, RP International’s Head of Project Solutions & Services, APAC.

Last week, Paul and Dominic attended MWC in Barcelona to see the latest developments occurring in the tech and telecoms industry, and to listen to what industry leaders are forecasting for the future of the sector. Of all of the discussions taking place across the four-day event, there were three recurring subjects that were on everyone’s agenda: Industry 4.0, Disruptive Innovation and Connectivity. Here, Paul and Dominic share some of the key points covered on these three topics, as well as one less-discussed area of innovation that will be vitally important to the industry’s future.

Industry 4.0

The general consensus within the telecoms industry is that Industry 4.0 holds immense opportunity for the sector, but seizing these opportunities will require more than an adaptation of product and service offering. To succeed, businesses need to initiate a dramatic shift in their thinking: this is, after all, a stage of technological development that will, as Naveed Suitan, Global Head, Treasury and Trade Solutions, Citi, explained, “blur the lines between the physical, digital and biological.”

Suitan went on to add, “historically, the winners of one industrial revolution have been the losers of the next. To survive and thrive in the era of Industry 4.0, companies will need to change…to be a winner, corporations need to transform their mindset and culture.”

One of the biggest developments in this area is AI. At last year’s event, people were talking about Artificial Intelligence, but it was very much theoretical. This year, there were working, tested AI products available, utilising AI for some surprising purposes, such as accountancy and taxation. In this instance, the products’ ability to learn and evolve means that they can adapt as laws and regulations change: a valuable, but less publicised, use of the technology.

There were also, of course, a lot of discussions around Industry 4.0 and the speed at which it is driving globalisation. “Aside from our core clients being the Telco Operators, we are seeing more and more companies based in the US and Europe looking to expand their operations to Asia and emerging markets,” says Dominic, “as well as an increase in the number of start-up companies looking to disrupt the market with newer technologies and more agile ways of working and hiring.”

The opportunities are seemingly endless, but one advantage that needs to be explored is the closer links it gives operators to their customers, opening a dialogue that should lead to the development of more valuable innovations.

Disruptive innovation

Is disruptive innovation an existential threat or an opportunity for telecommunications? According to Jose Maria Alvarez-Pallete, CEO of Telefonica, the answer to this question rests on how the industry adapts its model to reflect the value of what is being delivered.

In his keynote session on Monday, Alvarez-Pallete warned of the deflationary trend facing telecoms, stating that “there is no other sector where demand is growing at this level every year. However, it is massively deflationary.”

Organisations across the telecoms sector are investing heavily in new products, services and delivery. Yet there is a divide between the value of these services and the charges levied against them – a divide that needs to be addressed in order for the industry to survive and drive further innovation.

In many of the big telco transformations that are happening at the moment, especially in APAC, a key aspect is ensuring that they are in a better position to compete in the long to medium term with digital products. “At the moment,” explains Paul, “they are behind the curve and digital natives are able to bring in-demand products to the market more swiftly, but this is changing. At many of the stands this year, it was clear that telcos are waking up to what’s important to customers and developing technology to suit.”

Connectivity

According to Chua Sock Koong, CEO of Singtel, one of the key technologies that will help drive value creation and revenue is 5G. However, she added, to benefit from “the new era of intelligent connectivity” operators must rethink their approach and their products.

In high-density urban areas, the greatest challenge is in bringing 5G connection to interiors, where people have the most connectivity problems. This is going to be a challenge for CTOs and network planners as they work to roll out 5G successfully, but the answer lies in building solutions – a topic that was frequently discussed at the event.

It was clear that 5G will become commercially available in many more locations this year, and that operators are looking at innovative ways to overcome the obstacles. Ericsson CEO Borje Ekholm detailed the new 5G antenna technology that the company are currently working on in response to these challenges.

“We believe the next step is to distribute antennas everywhere and we’re already pushing antenna development into the size of a matchbox,” Ekholm explained. The next stage, he added, is to create antennas “so small and flexible that we can stick them with adhesive tape.” These ‘radio stripes’ would revolutionise connectivity in densely populated areas.

Hardware

One topic that hasn’t been so widely covered is the importance of hardware in this next phase of technological development. “The spotlight is very much on software: it’s the hot topic that everyone is interested in,” Paul comments. “However, it’s important to remember that hardware will still be needed to run these exciting new platforms – one individual spoke about the processing power necessary to support these innovations, and how this will become an increasingly important aspect of development.”