Comm. Smart Cities and IoT Supplement

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s m a r t v i e w s
IoT offers the telco industry a
new lease of life
Timesarechanginginthetelecomindustry.Overthecourseofthepastfewyears,wehave
witnessedthe transformation of the business modelof telcosfromausage-basedmodel
thatgeneratesrevenuesinexchangefortheusageofminutesandtextmessages,towards a
more diversified business model forwhichdataisanimportantpillar
Theemergenceofthisdata-centric
modelhashadanegativeimpact
ontheindustry.Operatorsare
sufferingfromthedownwardpressurethat
over-the-top(OTT)applicationsareimpos-
ingoninternationalcallingandmessaging
revenues;twoofthemajorcontributors
ofcashforoperators.TheseOTTapplica-
tions,inadditiontothefiercecompetition
inmanytelecommarketshavecreatedthe
needforalifelineforoperators.
Thislifelineappearstohavecomein
theformoftheInternetofThings(IoT).The
emergenceofIoThastransformedtelcos
frommereprovidersoftelecommunication
servicestoprovidersofaninfrastructure
thatconnectsamassivenumberof
devicesacrosseveryimaginableplatform.
WhatfurtherpositionsIoTasagolden
opportunityfortelcosisthenatureofthese
services,whichaffectsthedailylivesof
regularcustomers,thehugepotentialIoT
serviceshave,andthefactthefutureout-
lookshowsclearlythatconnecteddevices
willbecomethenewnorm;renderingtra-
ditionalnon-connecteddevicesobsoletein
yearstocome.
WhatdrivesIoTevenfurtherandboosts
itsadoptionrateistheapplicationofsuch
technologiesinsmartcityinitiatives.Such
initiativesarepickingupinourregion,
thelatestoftheseintroductionsbeingin
Jordan,wheretheMinistryofCommunica-
tionsandInformationTechnology(MoICT)
andtheGreaterAmmanMunicipality
(GAM)signedanagreementinAugustto
collaborateinformingatransformational
strategyforthecapital,andlaunching
initiativesandprojectsthatseektoturn
Ammanintoasmartcity.
Regionaltelecomoperatorshave
notonlyrecognisedthistrend,buthave
takenitastepfurther,andhaveactually
startedtotakestepstowardsexpanding
theirrolefrombeingjusttheprovidersof
infrastructure,tobeingdirectprovidersof
IoTservicesencompassingsurveillance
andsecurity,tracking,nearfieldcommu-
nications(NFC),andotherapplications.
Operators’introductionoftheseservices
hasbeendrivenbyslowingratesofgrowth
insubscriptions,duetothemajorityofthe
region’smarketsapproachingtelecom
servicesaturation.
Bymid-2014,14operatorsintheregion
hadbegunofferingtrackingservicesas
partoftheirportfolio,whilethreehad
startedprovidingsurveillanceandsecurity
services.Additionally,therewere19op-
eratorsthatoffereddedicatedM2MSIM
cardstotheircustomers.Thesenumbers
showthatthetrendisgainingtractionin
theregion,andindicatesthatoperators
areacknowledgingtheimportanceofIoT.
ArabAdvisorsGroupexpectthatthese
offeringswillincreaseinthefuture,and
moreoperatorswillstarttointroducesuch
services.
MohammedAlShawwaisresearch
manageratArabAdvisorsGroup

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s m a r t v i e w s
However,anumberofchallengesstop
thisfrombeingacompletelysmooth
ridefortelcos.Animportantissueinthe
Arabworldisthenatureofthemind-set
ofcustomers.Customersintheregion,
especiallyinlessdevelopedcountries,
haveconsumptionhabitsthatmightprove
difficulttochange,andoperatorsmay
needtoplaceextraemphasisontryingto
incorporatenewusagepatternsintothe
“comfortzone”stylethathasbeenwidely
adoptedacrosstheregion.
InanumberofcountriesintheArab
world,e-services,betheye-government,
e-banking,ore-commercesolutions,have
hadlittleeffectonthegroundinshortening
queuesandprovidingaseamlessexperi-
enceforpeople.Thisismainlyduetothe
factthatalargepercentageofpeople,
especiallyintheagegroupover45years,
finditmoreconvenientandmorereliable
toaccomplishtheirtasksthetraditional
way,evenifthismeansqueuingorgoing
allthewaytotheofficesoftheentityin
question.
Anotherchallengesharedbythetelcos
istheawarenessofsuchIoTorsmartcity
solutions.Whiletheresponsibilitytoraise
publicawarenessoftheavailableservices
lieswithboththeIoT/smartcityproviders
andtelcos,operatorsneedtorecognise
thatthepublic’scomingtoknowofsuch
solutionswouldactuallytranslateinto
additionalrevenuesfortheecosystem,
addingvaluetoservicesthatarealready
beingoffered.
Inanutshell,IoTisatidethatwill
changethewaypeoplegoabouttheir
dailylives,anditwon’tbelongbeforecon-
necteddevicesbecomethenewstandard,
whiletraditionaldevicesbecomeobsolete.
Theopportunitypresentedtotelcosisfor
themtogenerateanewincomestream
andbenefitfromtheexponentialgrowthof
amyriadofconnecteddevices.
Bymid-2014,14operatorsinthe
regionhadbegunofferingtracking
servicesaspartoftheirportfolio,while
threehadstartedprovidingsurveillance
andsecurityservices.Additionally,there
were19operatorsthatoffereddedicated
M2MSIMcardstotheircustomers
Insomecountries,e-services,betheye-government,
e-banking,ore-commercesolutions,havehadlittleeffecton
thegroundinshorteningqueuesandprovidingaseamless
experienceforpeople