Due to the surge
in network demand during the ongoing pandemic, the pressure to maintain
infrastructure resilience has topped the world telecom risk radar. At the
initial stage of the lockdowns, global Internet traffic has spiked to 70%;
thus, telcos are now being elevated to a societal role as connectivity
providers.
This is
according to Ernst & Young (EY) report, Top 10 Risks in Telecommunications
2020, which combines EY industry
insights and consumer survey data to shortlist the most urgent threats facing
today’s telcos.
Tom Loozen, EY
Global Telecommunications Leader, says: “Overall, networks have withstood a
sharp increase in home working, entertainment and schooling during the pandemic
and telcos have commanded favourable customer opinion as a result.
“However,
revenues are set to decline across most product categories and telcos must not
become complacent.
“The journey to
recovery will require new thinking and competencies, shifting the customer
promise from speed to reliability, so telcos can thrive in the ‘new normal’.”
Failure to
mitigate escalating geopolitical and competitive disruptions was listed ninth
in the ranking, but it underpinned all of the top 10 risks.
With network
equipment supply chains increasingly being disrupted by global trade forces,
there are concerns that 5G roll-outs could be delayed, although telcos in South-east
Asia have actually begun accelerating their launch of commercial 5G services.
Thailand’s
telcos were the first to offer 5G services in ASEAN in May 2020, followed by
Singapore’s telcos in August.
Sam Wong,
Managing Partner, Asean Markets, Ernst & Young Solutions, concludes: “A key
issue telcos in South-east Asia face is the lack of monetisable use cases
beyond enhanced mobile broadband, which limits the return on investment.
“Other
challenges to tackle include business transformation, Capex and Opex optimisation,
and regulatory issues.
“Telcos will
need to fundamentally evaluate their role in the context of the IoT value chain
and ask how they can transform from ‘telecom service provider’ to ‘digital
service providers’.”