In looking ahead to 2018, Syntonic, a mobile platform and services provider, anticipates tectonic industry shifts based on skyrocketing mobile data usage, evolving relationships between wireless carriers and content providers, an increasingly competitive unlimited data landscape, and new monetization trends in international roaming and the internet of things (IoT).
In developed economies, the always-connected consumer has embraced the mobile app ecosystem and is devoting more time than ever to the most data-heavy apps, such as music and video streaming. We now live in an app economy that is putting pressure on the entire mobile industry. According to eMarketer, apps accounted for nearly 85 percent of total mobile time and approximately 20 percent of total media time spent over the past year.
Driven by the growing demand for more mobile content, the 2017 mobile landscape witnessed an unprecedented, unlimited data price war between the major US mobile operators and ongoing M&A activity between telecom giants and content behemoths. While 2017 served as a turning point in the shift to a more content-centric industry landscape, 2018 will see that evolution come to a head as friction between consumer demand and carrier capabilities ignites the mobile ecosystem.
In 2018, Syntonic forecasts the following trends:
Unlimited data plans in the US will become even more prevalent, yet more limited
In 2018, unlimited data plans will continue to permeate the wireless market; however, consumers will find these plans becoming more limited than ever. As carriers grapple with increases in mobile network utilization and congestion, more fine print will be included in ‘unlimited’ plans to maintain quality of service and preserve profit margins.
As a result, consumers in 2018 will be faced with degraded video quality, diminished streaming speeds, and throttled content, causing frustration and confusion around the benefits of ‘unlimited’ data plans.
To mitigate the shortcomings, carriers will offer an increasing number of add-on options for access to the higher quality of service previously included under unlimited plans. For example, some plans in the US currently top out at 720p video resolution unless one pays $10 more a month per line to get the full HD experience. While the availability of unlimited plans will continue to prove popular in developed economies, expansion into emerging markets will be slow due to high costs and an upsurge of alternative models such as sponsored data, zero-rated apps, and content-first data plans.
International data roaming emerges as one of the largest growth segments
The international data roaming market is especially well positioned for disruption. Carriers will recognize the revenue opportunities of new roaming business models, such as sponsored offers, content-based plans, and micro data plans, which relieve the pain points that international travelers encounter while roaming.
Legislation, especially in the European Union, will force operators to lower tariffs, making the cost barrier more digestible for the general consumer traveler. Based on the evolving trends of content-hungry consumers, unlimited data plans, rampant mobile device adoption, and the growing demand for over-the-top services, carriers will embrace new international data roaming business models.
Sponsored data lights up consumer IoT devices
The IoT has shaken up mobile and telecom industries with the rapid introduction of internet-connected consumer devices, such as watches, glasses and automotive technologies. In an effort to adapt to the rise of this market, wireless carriers have been forced to incorporate special consumer data plans for IoT devices.
The coming year will see the broad scale use of sponsored data for entire classes of consumer device scenarios. For example, insurance companies will sponsor the telematics data for automobiles; fitness apps will sponsor wearable devices; and gaming platforms will sponsor AR and VR glasses. Sponsors will provide immediate benefits to consumers by offsetting IoT costs with ad- and brand-supported models.
A TM Forum Catalyst project is currently working on a fabric allowing providers to offer mobile sponsored data services to enterprises from various industries, so that these enterprises in turn can deliver free (sponsored) data to end users. At TM Forum Live! in Nice earlier this year, the project presented a number of use cases, while in TM Forum Live! Asia last month, participants introduced some new scenarios around location-based sponsored data and the roaming opportunities available with sponsored data.
Find out more about the project here, and get in contact if you’d like to be involved, particularly if you’re in the area of billing and can aid in filtering through usage information and generating bills.
Get involved in the discussion on the TM Forum Community site.