The effects of the COVID-19 pandemic will continue but the telecoms sector, which has proved its resilience to the overall economy in 2020, will return to growth in 2021. Telecoms operators have been well-placed to support consumers and businesses during the crisis.
Stephen Sale, research director at Analysys Mason, noted that “fixed broadband has helped to offset declines in mobile revenue for many operators and will support growth in 2021.”
He adds that “while revenue from roaming has been particularly badly hit, operators will begin to report growth again from the second quarter of 2021.”
Enterprise revenue, however, is likely to be subject to a second dip as many firms cease trading in 2021.
Analysys Mason predictions:
Industry growth: We expect that the telecoms industry will return to growth in 2021 with total revenue up 1% in 2020 (USD13 billion). This follows a difficult year – industry revenue will fall by 2.7% (USD43 billion) in 2020. However, global telecoms revenue will not exceed 2019 levels again until 2023.
Telecoms vendors: Many operators will take their first steps in opening up the mobile network to more vendors. This will disrupt the vendor landscape, putting pressure on traditional suppliers. Cloud vendors will acquire more telecoms-specific capabilities along the lines of Microsoft’s recent purchases of Affirmed Networks and Metaswitch.
5G – consumers: In 2021 and beyond, operators will rely on the development of content and services that push performance requirements and stimulate demand for 5G. However, we do not expect 5G to provide any meaningful ARPU increase in 2021.
5G – businesses: The B2B market is commonly cited by operators and vendors as being central to the 5G business case, and yet offers built on 5G capabilities are still rare. This should start to change in 2021 as more 5G products for enterprises are launched.
IoT: Operators have so far failed to provide an answer to new entrant IoT MVNOs, like 1NCE, EMnify and Twilio. At least one major operator will respond to this threat in 2021 by buying one of these players.
Automation: Operators’ automation efforts are already eliminating staff from routine work. We expect them to increase their spending on fully automated orchestration from USD4 billion in 2020 to USD20 billion in 2025.
New opportunities: Trends accelerated or disrupted by the pandemic will provide new opportunities for operators at the intersection of cloud and connectivity, for example in cloud gaming, healthcare, education and business cloud services. Several operators will provide edge cloud capabilities for cloud gaming services.
