With CSPs’ revenues and business models under growing pressure, blockchain’s ability to improve critical processes such as roaming and identity management, while facilitating new business models, means interest in the technology is growing fast.
17 Jun 2019
The value in blockchain: The big picture
Download the related report Blockchain: Where’s the value for telecoms? for further details guidance on how, when and where to deploy this exciting new capability.
With communications service providers’ (CSPs’) revenues and business models under growing pressure, blockchain’s ability to improve critical processes such as roaming and identity management, while facilitating new business models, means interest in the technology is growing fast.
Blockchain establishes a shared, immutable record of transactions within a network. Each digital transaction is agreed by consensus and the transaction is then time-stamped, becoming a block in a chain o f blocks. In this way, a blockchain represents a true, accurate and – perhaps most importantly – trusted record of each transaction made. So, what is the value for telecommunications companies?
For a start, the technology is especially well placed to facilitate settlement. Telefónica and Colt, for example, participated in a blockchain proof of concept (POC) led by PCCW to settle voice transactions between multiple operators. Telefónica is also focusing on call detail records to ensure settlement runs more smoothly. Deutsche Telekom is deploying blockchain to simplify roaming agreements, and its Telekom Innovation Laboratories subsidiary has developed its own approach based on Hyperledger Fabric, which is being developed in a Linux Foundation project.
Blockchain can also add value to identity management as it can cut out intermediaries through smart contracts. This means an ID number is all that is needed to authenticate an individual, resulting in far fewer processes and happier customers. Deutsche Telekom and SK Telecom are using blockchain to establish a real-name authentication program designed to streamline verification and subscription processing.
Meanwhile, SoftBank is working on a secure identification system that can cross borders, and AT&T has collaborated on a blockchain-based mobile authentication initiative. Vodafone, too, is honing its blockchain strategy and expects identity and supply chain management solutions to be launched within one to two years.
Inherent security
Given blockchain’s origins in cryptocurrency, it is highly relevant when it comes to e-commerce and payment systems. Its inherent security means the technology can both protect transaction data and prevent the theft of financial information. Globe Telecom has used the technology to launch a cross-border money transfer service, while SoftBank has worked with partners to demonstrate a blockchain-based payment platform.
Carriers are evaluating more left-field use cases too, including Telefónica’s trial of a blockchain-based platform enabling individuals to sell validated private information for a profit, and Deutsche Telekom’s use of the technology to enable the anonymization and distribution of blocked IMEI numbers, a topic covered in TM Forum’s recent Blockchain Unleashed Catalyst.
Download the related report Blockchain: Where’s the value for telecoms?
