Over the last two decades, the telecommunications industry has grown significantly, driven by the adoption of new technologies. According to one Colorado-based research firm, the sector, which is expected to generate $2.4 trillion in revenue by 2019, currently services a market of around 4.7 billion mobile users.
However, some industry experts suggest that companies within this sector may find that the telecom industry is reaching a tipping point in the near future, with many firms losing ground to competitors who offer simpler, streamlined services that overtake more traditional telecommunications options. In order to avoid becoming a victim of digital transformation, experts suggest that one thing telecommunications executives should be doing is looking for ways to modernize their operations, such as through the implementation of blockchain technology.
Blockchain is a secure digital ledger technology that allows for the distribution of information without replication. It can carry out transactions quickly and efficiently while protecting the sensitive information contained therein, allowing individuals and organizations to interact anonymously through a system that relies on collective transparency in order to keep business dealings honest. With regard to the telecommunications sector, blockchain technology can offer three solutions that will help modernize the industry and allow companies to develop in the digital age rather than fall victim to it.
1. Simplify and streamline internal processes
The telecommunications industry hinges on cooperation between a complex web of customers, vendors, distributors, and providers. The use of blockchain technology could allow firms to develop a more efficient business model by streamlining Operation Support System (OSS) and Business Support System (BSS) operations. In the digital age, efficiency is crucial, and blockchain is a tool that can facilitate quick dealings between a large number of parties within a single transaction, which includes accurate and efficient billing. Blockchain could also create faster on-boarding processes for new customers when a client’s new telecommunications provider operates within the same blockchain as the previous provider.
2. Reduce the incidence of roaming fraud
Each year the telecommunications industry loses revenue to fraud, approximately $6 billion of which stems from roaming fraud, which occurs when a mobile user automatically connects to the services of another network provider in the event that his home network is unavailable. The use of a telecommunications service while roaming incurs a greater expense for customers and is a major source of revenue for telecommunications companies. However, call data often does not appear on the user’s home network for days or weeks, providing a window of opportunity for fraudsters to attack. Many subscribers who commit roaming fraud have used a visiting network and then feigned ignorance about using roaming services. They deny requesting roaming services or insist that they were not educated on the charges that roaming services can incur. Industry experts suggest that the best way to curtail the incidence of roaming fraud is to reduce the time that it takes for the two networks to exchange data, and blockchain is the perfect tool to make this happen. Blockchain can serve as a platform for systems that provide subscribers with a pathway to use roaming services after authenticating their identity, and can track the data usage in real time so that the window of opportunity that allows people to make fraud claims is greatly reduced.
3. Help telecom companies reduce costs
Apart from the money saved from streamlining operations, blockchain can help telecom companies cut costs in many ways, which includes using smart transactions to allow customers to purchase digital products, including music, gift cards, and mobile games. Blockchain can facilitate the purchase of these types of products through cryptocurrency, which incurs a much lower cost to companies than transactions undertaken with credit or debit cards.
Mikhail Golomb 