Next-generation Roaming and the Changing Face of the Telecom Industry

As pressure on consistent data services grows with LTE, operators need to look at better integration within local circles and overseas travel.

By: HT Brand Studio

Source: Pixabay

In today's digital age, the mobile phone has practically become ubiquitous to modern existence. Consumer habits have evolved over the years, and the introduction of LTE networks, more commonly known as 4G connectivity, has meant instant access to high speed data, even while on the go.

A recent survey by Informa Telecoms & Media looks at the opportunities and the challenges faced by the operators in the industry, particularly with regards to mobile data roaming. The survey, which was executed in conjunction with extensive research in this space done by Informa, received responses from mobile operators, mobile virtual network operators (MNVOs), telecom equipment vendors, and wholesale carriers. It tackles challenges surrounding LTE and next-generation roaming. The increasing importance of digital media and social networking, according to the respondents – over 400 in number, spread all over the globe - has led to the growth of mobile data roaming being embraced as a necessity, and not merely a luxury.

A major deterrent for consumers, especially when it comes to data roaming, is the idea of the "bill shock", where the disparity between local rates for data consumption and rates for roaming data acts as an obstacle to regular usage of data while travelling. A strong degree of uncertainty surrounds this space for users. However, regulations addressing this specific matter do help alleviate the situation somewhat, but there is a strong need for operators to strategise in a way that encourages users to approach data roaming with less trepidation. This could be in the form of a better overall experience, personalised packs targeting individual preferences, as well as attractive roaming plans.

Traditionally, data roaming has revolved around a per-minute or per-MB model. But, given the evolving needs of the consumers, it's essential to move toward a model that allows for innovative data bundles based on the users' needs. 'Leisure travellers', for instance, tend to use apps such as Facebook or WhatsApp on their travels. One way of alleviating the concept of bill shock is to provide such bundles that will cater to the needs of the consumers. 3 Hong Kong, for example, provided a $6 a day package with 5 MB of inclusive data to use WhatsApp on a roaming service. The same applies to business travellers as well, who would be willing to purchase application-specific bundles while abroad. Further innovations, such as allowing consumers to use their "home allowance", their local rates, while roaming, can also be useful. In fact, according to the survey, 50% of the respondents feel there is a need to bring down roaming rates to a level comparable to home rates. That said, major roaming agreements are usually based on a per-MB model, limiting the scope for tariff innovations.

In India, too, these factors play a role. With the launch of LTE and, subsequently, the increasing pressure on data services, it remains to be seen how operators here approach next-generation roaming. It becomes imperative to ensure better integration within local circles and overseas travel, where rates need to be comparable. Competition in the market is at an all-time high with the entrance of competitively priced players and there's a greater burden on incumbents to adapt to changing market trends. Already established companies, with considerable investments pumped into the infrastructure, now have to battle against predatory pricing to ensure they are not freezed out of the market.

However, while price is no doubt an important factor, there are considerable other avenues that operators can venture into to ensure success. A way of enhancing the user experience is to enable Wi-Fi connectivity, an aspect which AT&T employs to great effect, tying up with Boingo Wireless for Wi-Fi roaming. A chunk of the respondents do believe this will cannibalise roaming revenues, but that could potentially be counteracted by investing in global Wi-Fi networks, and it may also help in capitalising on devices functioning a "Wi-Fi Only" setting.

Social media, like in most walks of life, again plays a significant role here. The research shows that globally, the average daily volume of over-the-top messages (OTT messages, or messaging conducted through third-party applications such as WhatsApp) is now 19.1 billion, compared to 17.6 billion for SMS messages. By the end of this year, OTT messaging volume is expected to be double that of SMSes. Even with businesses, LTE services allow far greater efficiency given their obvious upgrade on 3G networks, which means enterprises are now moving on to newer digital services such as conferencing, enterprise cloud, and machine-to-machine (M2M).

Operators believe that the driving factor, in terms of generating business opportunities for them, is social networking, followed by Rich Communication Services (RCS), video services, and M2M. This means that there's a need to create roaming service portfolios and business models to support these services.

Operators will also need to remain clued in to consumer trends. For example, there has been a steady shift in terms of voice, which is now migrating to IP, through Voice over Long-Term Evolution (VoLTE). It's still in its early stages, but it is expected to grow significantly in the next few years.

Need of the hour

Price is a major factor, but focussing on elements such as interoperability or transparency to eliminate the uncertainty and the potential for bill shock is essential as well. Innovative and forward-thinking moves, like application-specific plans, embracing M2M, and the challenges surrounding leveraged buyouts (LBOs) are all factors that play a role. It's an exciting time in the telecom industry, and the need of the hour is for operators to make sure they evolve with the developing technological and regulatory changes to ensure engagement with the consumers.

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