As year-end approaches, analyst and consultancy firms, industry players and assorted commentators are once again posting their predictions for telecoms in 2024. However diverse their research interests or business focus, almost all of these forecasts share a common theme this time around - namely the expected impact of artificial intelligence (AI) on the industry as a whole in the year ahead.
The message is that AI’s influence will pervade all areas, ranging from networks, data centres, internet-of-things (IoT), devices and semiconductors, to network operations, customer service and experience management, data security, marketing and business transformation.
The promised benefits of AI will be tempered by its challenging and potentially hugely disruptive implications, and observers hope that 2024 will see further clarification as to how and where it can be usefully and productively employed.
In the broader picture, analysts at PwC expect to see a declining growth rate in both fixed and mobile broadband network investment in 2024 and beyond. Equipment vendors too are cautious, with Nokia anticipating a challenging mobile broadband market in 2024, particularly in the wake of India’s rapid 5G deployment in 2023.
In the fixed broadband market, the majority view is that fibre broadband deployments providing 10Gb connectivity will continue expanding in most developed and developing markets, with hoped for improvements flowing from government funding in the year ahead.
5G still underperforms, but satellite services will take off
As in 2023, the performance of 5G is a focus of predictions for the year ahead. Networks continue to fall short on their promise to deliver new value-added services that exploit 5G’s additional bandwidth, says network data and performance analyst firm Ookla, with service providers struggling to recover their investments in the technology. The industry needs to find ways to monetize 5G beyond fixed wireless access use cases, and to support future investment into standalone (SA) 5G and 5G Advanced, Ookla adds.
However, the anticipated commercialization of key technologies and features of 3GPP Release-17 during 2024 may improve the prospects for monetization of 5G. These include reduced capability (RedCap) IoT technology, which is already being trialled by the likes of Huawei and Ericsson and is expected to progress towards wider commercial deployment in the coming year.
Release 17 will also introduce new radio (NR) support for non-terrestrial network (NTN) technology, primarily satellite communications. The economic downturn in 2023 had the effect of holding back the development of satellite-based 5G says Juniper Research, but the rapid growth in 5G subscriptions worldwide (reaching 1.6 billion by end-2023) has significantly improved the value proposition for satellite-based services.
Commentators broadly agree that as well as having the potential to play a critical role in the development of 5G networks in areas such as private networks, IoT and mobile broadband, satellite 5G will also support improved 5G service coverage in underserved areas by delivering more economical, high-speed Internet connections.
Consulting firm Deloitte reports growing interest in satellite’s capabilities to extend connectivity, and expects to see an expanding ecosystem of satellite and mobile network operators, handset manufacturers and semiconductor companies, with over 220 million smartphones capable of connecting with satellite services to be sold in 2024.
Equipment vendor Ericsson believes that the fully integrated system-on-chip (SoC) solutions expected in 2024 will help to drive NTN, providing the necessary economies of scale needed for global adoption of satellite services in cellular devices. In its annual Mobility Report, the company says that services can be expected to initially focus on text messaging and low-data-rate services.
According to Juniper Research, an increased number of satellite launches will cause a surge in the development of services in 2024, driven by the activities of satellite network operators such as Starlink, Intelsat, Inmarsat and Sateliot.
The Economist Intelligence Unit (EIU) expects satellite internet providers such as Starlink and UK-based OneWeb to continue expanding their partnerships with telcos in Asia in 2024, while in India, there will be strong competition from domestic providers Jio and Tata, as well as Canada’s Telesat, in receiving licences to offer satellite services.
Fibre broadband will be expanded, and supported by home WiFi
In the fixed broadband market, the continued expansion of fibre deployments in both developed and developing markets is, in turn, creating a need for upgrades to home Wi-Fi networks in order to pass on the increased bandwidth to devices in the home, says the Wireless Broadband Alliance.
Key trends such as the proliferation of cloud gaming services, which will stimulate the demand for high-speed and low-latency connectivity, will drive demand for more bandwidth in the home. One result of which will be the rapid adoption of Wi-Fi 6E and Wi-Fi 7, which also have the advantage of being able to access additional spectrum in the 6GHz band as more countries open the band, according to the WBA.
At the same time, WBA expects to see pilot projects and trials of TIP Open Wi-Fi - the Telecom Infra Project’s open source, multi-vendor Wi-Fi architecture - proliferating in developing countries and price-sensitive markets where its cost-effectiveness and open disaggregated model are expected to prove attractive.
Geopolitical issues will continue to impact technologies and markets
According to the EIU, geopolitics will continue to affect technology in 2024 as the tech battle between the US and China in areas including AI, chips and quantum technologies rumbles on. The EIU says it is unclear how far either side wants to go in terms of restricting investment in markets such as the US and Europe by Chinese companies, or how access to key markets such as China might put a limit on further measures.
“Other countries will continue to play the two leaders off, in line with their own strategic interests and their budgets,” notes the EIU.
Climate concerns and sustainability will be drivers for change
According to Deloitte, the telecoms sector’s drive to further reduce its carbon footprint in 2024 will add impetus to the transition from copper wire networks to energy-efficient fibre optics, the decommissioning of power-intensive 3G networks, and the use of power-saving technologies in 5G radio gear.
Deloitte predicts that telcos worldwide may be able to reduce their carbon footprint by 2%, or 15 million tons of carbon dioxide equivalent (CO2e) in 2024, and do the same again in 2025.
Juniper Research also expects operators to focus on new initiatives intended to reduce the environmental impact of telecoms in the year ahead. While increased network automation through measures such as AI and machine learning will generate efficiency gains, the need for more base stations and wider geographical coverage, coupled with the introduction of higher frequency bands, will mean a greater focus for base stations and other network equipment to use less energy.
The inevitable deployment of 6G networks will likely require ever-higher frequency bands, which will exacerbate this need for more energy-efficient equipment, says Juniper Research.
Similarly, in data centres, AI is accelerating increases in density while at the same time doubling or tripling power consumption levels, says networking and data centre equipment vendor NTT. This is “playing havoc with enterprises net zero targets” and necessitating a closer working partnership with energy providers to explore more sustainable options with techniques such as liquid immersion cooling, district heating projects, and solar panels in space.
First steps towards 6G
While 5G services strive to deliver on performance and ROI, 2024 will also mark the official start of the 6G race according to research company Omdia. The ITU’s World Radiocommunication Conference (WRC23), taking place during November and December, is seeking to identify the spectrum frequency bands that will support 6G services.
The WRC23 agenda addresses questions including the allocation of spectrum in the upper 6GHz band to radiocommunication services, and potential conflicts with existing fixed-link and satellite services.
New solutions bring new challenges
Commentators are broadly agreed that the depressed state of the global economy coupled with geopolitical uncertainty will continue to impact the telecoms sector in 2024. At the same time, technologies such as satellite 5G and enhanced WiFi promise to expand connectivity and provide a richer service experience for businesses and consumers, with emerging markets expected to see many of the benefits.
These new technologies will also bring new challenges, however, and expectations are riding on AI to help in the ongoing drive for reduced costs, increased efficiencies and greater sustainability, Early in 2024, Developing Telecoms will be publishing a more in-depth overview of predictions for AI and its likely impact on telecoms in the coming year.