The evolution of the SIM.
CommsMEA: What are the biggest challenges being faced by operators in the present market conditions?
Brad Taylor: Mobile network operators are challenged to find their rightful position in today's internet society driven by data, and OTT platforms; traditional revenues are flat, and growth is slow. MNOs' data offerings are no longer a USP and digital businesses know more about their customers' buying behaviour than the operators themselves. It's not that the new telecoms landscape excludes MNOs, but operators need to make bold decisions to move in new directions. To do so, they must understand how to monetise their network, what competitive services to provide and who to partner with. Currently, their subscribers require increased data speed, and channel capacity, but the gains are driven by OTT players who earn the lion's share of the available revenue streams. The age-old question that remains is what changes are required by telecom operators to monetise the internet and which partners should they choose? One would expect that these IoT investment strategies would convert the current MNOs from being pipe providers to IoT hubs in the near future.
CommsMEA: How can telcos and telco vendors maximise ROI in such a scenario?
Taylor: Agility of technology is the way to go. Over the next two years, operators should learn to use technology to better serve their subscribers. They should look to deliver services where the MNO is the hub of activities. However, initially, to get more out of their current business model, operators are using optimisation to become more efficient through better purchasing, planning of resources, and processes. This includes enhanced supply chain optimisation, meticulous demand planning, BI services, and the virtualisation of services to online SaaS systems to deliver customised solutions quicker, easier, and more efficiently. Soon, MNOs and manufacturers will start providing disruptive services in several areas. The mind-set should be positive and entrepreneurial with the focus on new partnerships and long-term opportunities rather than short-term tactics.
CommsMEA: What's your opinion on the transition from UICC to eSIM?
Taylor: The eSIM is an enabling technology, it will provide greater connectivity and be a key driver of IoT. However, there are two key areas of development, M2M and consumer business, which are developing at different speeds. It's envisaged that the M2M sector will deploy services faster and sooner than the consumer market. With remote provisioning, the eSIM can constantly be updated to change the subscription, applications, and services. Of course, the flexibility to easily switch between networks will provide the subscriber with a more seamless experience and greater freedom. Perhaps some operators are looking at this technology as a threat and are thinking how they can make it more restrictive but, equally, there are telecom operators looking at the potential in terms of business opportunities. We're already seeing the partnership between operators and car manufacturers, and this is just the beginning. From a vendor perspective, Workz is well-placed as a trusted services manager to securely manage the eSIM profile and the subscription lifecycle.
CommsMEA: How do you see the IoT and M2M market shaping up in this region?
Taylor: Digital transformations are leveraged by the combination of mobility, cloud storage and applications, social networks and big data/telemetry. The increasing role of mobile devices in our lives as well as, the residual data trail presents profound opportunities for those able to capture this critical information about customers and their activities. MNOs are part of these opportunities because much of the information sent by customers originated from their mobile phones or the mobile internet. Organisations, like those in banking, utility and transportation are looking at various ways of monetising this valuable information with the use of IoT solutions. In this transitionary stage, MNOs are most likely looking to transform their role from the pipes transporting data to the hubs supporting IoT activity.
Countries like Saudi Arabia and the UAE are well positioned to offer the first smart cities in the region. These regional governments recognise the importance of this market and see it as an essential path to economic development. As such their visions reflect the desire to make their respective countries the most advanced in the world. Initial reports appear to indicate manufacturing, transportation, utilities, and government are the sectors driving IoT investment in the region. Here in the UAE, which was one of the first countries in the region to embrace IoT and M2M, the industry is estimated to grow from $10 billion to $35 billion by 2019. The Dubai government has committed to launching 1,000 smart city initiatives by next year in its drive to be the world's smartest city. UAE operators are very much involved with these smart city initiatives too. Etisalat launched the first IoT application in the MENA region in 2015, and Du launched its Smart Dubai Platform earlier this year.
CommsMEA: What kind of value is Workz bringing into the VAS space?
Taylor: For Workz, currently around 30-40% of operators use over-the-air services to manage their SIM value-added-services, but within the next couple of years we expect this to increase significantly as there will be a requirement to make multiple remote SIM updates in a short period of time. In terms of deployment, the principles remain the same, however, the means will soon change from physical SIM card swap out to a digital remote provisioning of an embedded smart element in the mobile device. We provide a range of Over-The-Air (OTA) applications that allow the remote management of value-added services on the SIM. As a trusted services manager we provide the secure data provisioning and routing to enable/disable, add/remove or update the SIM for the operator or device manufacturer during the lifecycle of its subscription. This type of service is something we see growing significantly with the explosion of eUICC and M2M connected devices and the demand for innovation around such things as geo-location, smart-metering, and telemetry, AR/MR, & VR etc. All of this will bring a great deal of opportunity for remotely managed SIM VAS applications.
CommsMEA: How do you visualise the telco market shaping up in the coming years?
Taylor: The future of MNOs is likely to see consolidation in markets where there are more than two players. The MNO's current business model is also evolving and should move from connectivity, speed and capacity to becoming the hub of big data solutions. The operator's challenge will be to partner with OTT companies that will help them deliver end-user solutions by offering open platforms and shared data with minimal regulation. It would not be difficult to see a future where your mobile device is a combination of communication, data, IOT tracking devices, government ID, health, wallet, and travel functions.
CommsMEA: How has business been in 2016 so far? What's next on the radar?
Taylor: Workz has been fortunate not to have been hit hard by falling oil prices or the latest recession. Our success has been due to preparation, timing, and a bit of luck. For the past three years we consolidated our operations and have been driving cost out of our business through innovation. We've reinvested in our core business increasing our manufacturing capabilities. This year we will produce over 1 billion scratch cards which we believe puts Workz in the top three largest scratch card manufacturers in the world. We've also invested in SIM card manufacturing facilities, our own SIM operating system and OTA platforms that provide a highly cost-efficient, full solution capability from product development to manufacturing, packaging, and fulfilment all from under one roof. These investments set the stage for our next transition to eUICC solutions and big data management. Our aim is to be the regional telecoms subscription manager for operators in the Middle East and Africa. From our Dubai position, we can offer them both high-quality and low costs as well as a fast time-to-market.
CommsMEA: What's been the most successful launch/project/partnership for Workz this year?
Taylor: Overall our biggest achievement has been the successful completion of our business to a full-service telecoms subscriber products provider. As a local supplier, our aim is to provide telcos with a full, end-to-end solution from product development, production, packaging, fulfilment to logistics from one central location. We believe that being a full-service provider that is close to market is of greater importance to operators now than ever as they seek faster, more integrated and more efficient solutions.
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