In 2022, major telecoms around the world will face tighter regulatory policies and broadband prices are expected to rise as operators struggle to create value for their shareholders.
These are some of the telecom predictions for 2022 by independent consultancy Strand Consult, which analyzes the ups and downs of the mobile telecom industry in 2021 and makes predictions for 2022.
According to the consultancy, the past year developed very differently from other years, but it was not so different from 2020.
In 2020, it was an understatement to say that COVID-19 was a game changer for the telecom industry. As a result of the pandemic, communications networks built and operated by operators around the world have become more important than ever, according to Strand Consult.
Mobile phone and broadband prices have dropped over time, but 2022 is set to be the year when prices rise across the world. Just look at Denmark, which in 2021 found the telecoms regulator colluding with energy companies to fix the wholesale price of fiber access at levels above what the market offers.
As such, prices are guaranteed to rise in Denmark and other European countries due to the efforts of regulators. As the regulated price of fiber will rise, broadband prices on private networks will follow.
Strand Consult expects that many of the operators that are struggling to create shareholder value through organic growth will raise prices in 2022. That's the law of demand and without price increases it will be difficult to invest in network upgrades.
BUT: Minister of Telecommunications says that 2022 will be a better year in the sector he directs
China and Huawei will face a tough year
When Joe Biden became US President in January 2020, many wondered how US policy would change towards China and Huawei. Strand Consult said the policy was unlikely to change and, if it did, could be tightened.
Strand Consult believes that this year Huawei will continue to face significant financial pressure, and public opinion about Huawei is not expected to change any time soon.
Many countries consider the use of Huawei equipment in telecommunications networks to be unsafe and unsustainable. Some carriers faced increased reputational and regulatory risk when using Huawei, and corporate customers don't want their confidential and valuable data vulnerable to the Chinese government.
It will be difficult for Huawei to convince public sector buyers in the US and Europe to buy its solution of putting data into Chinese IT systems and the Chinese cloud.
The cloud explodes in 2022
Policy makers will turn their attention to privacy issues related to the public cloud – which contains an ever-increasing amount of data from citizens and businesses. In 2022, cloud services from Amazon, Microsoft and Google will rise into the public consciousness as mobile operators store parts of their networks in their data centers.
As mobile networks are increasingly integrated into the clouds, this means that individuals and businesses are increasingly integrated into big technology. There is no turning off great technology or choosing not to use it.
This increases the complexity and difficulty of porting data from one cloud to another – thus, companies may find it impossible to migrate from one cloud to another.
This will continue to raise alarm bells in the antitrust world, and raise more questions about protecting consumer data.
Market for private 5G networks
In 2021, much has been written about private 5G networks: Who will build them and who will run them? It's a market that many want to enter; everyone from mobile operators to IT companies, systems integrators and infrastructure providers. OpenRAN players want in too, although it remains to be seen whether they can meet the high demands of a classic mobile network.
In 2022, Strand Consult expects fierce competition, very low margins and an inevitable shake-up in the private 5G market.
