Research Notes

2019 predictions for the mobile telecommunications industry from Strand Consult

2018 was another exiting year. We wish you a Merry Christmas and a Happy New Year. This note reviews the highs and lows in the telecom industry in 2018. Strand Consult’s annual predictions which we’ve done for the last 18 years will follow shortly. 

Strand Consult’s 6 priorities for 2018 – important knowledge in 2019.
In 2018 Strand Consult focused on six areas to ensure that its customers have the knowledge in reports, training, and workshops to navigate in a complex world. The priorities in 2018 were:

1. How to deploy 5G: Best practices for infrastructure, regulation and business models: Strand Consult’s research provide best practices for infrastructure, regulation, and business models. Based Strand Consult’s success to reduce cost and improve regulation for mobile infrastructure in Denmark, this research describes the proven 10-step process to get results. Strand Consult offers knowledge, training, and tools provided to help operators save time and money.

 Four to three mobile mergers and why they fail: Strand Consult’s research provides powerful facts about mobile industry consolidation in USA, EU, and around the world. Strand Consult’s goal is to lift the level of merger review in quantitative analysis, improve the credibility and transparency of antitrust decisions, and protect agencies from regulatory capture. Companies need to be smarter in their consolidation strategies; antitrust authorities need to improve their toolsets and measurement techniques; and policymakers need to modernize the standard of review.

  Data protection: Many European politicians have touted the General Data Protection Regulation (GDPR), saying it would “level the playing field” against the American internet companies, but the largest American firms have gained market share while thousands of small and medium sized firms have exited the market. It has depressed venture capital investment in Europe, which was already low compared to the US. Despite a decade of increasing regulation in the EU, European consumers do not report a greater sense of trust online. This research explains the geopolitics behind the GDPR and why smart nations will pursue a different course that focuses on consumer education and innovation.

 Net Neutrality regulation around the world: This research documents to what degree net neutrality rules achieve their stated goals and the unintended consequences for operators, content providers, and consumers. The EU’s net neutrality law will enter its fourth year in 2019, but European policymakers cannot point to an increase in innovation and end user rights, as was promised.  Europe still lags behind on innovation and investment when compared to East Asia and the US, which reversed its heavy-handed regulatory approach in 2017. Meanwhile the Body of European Regulators for Electronic Communications (BEREC) doubles-down on regulation.

Local government and its impact to competition in the mobile telecom market: Strand Consult’s research has documented how municipalities have interfered in a competitive market by unfairly favoring government-owned infrastructure. Strand Consult has revealed the tactics deployed by city leaders, whether using public money to reward cronies to disadvantaging private competitors. This research has been used to stop many projects which were found to be illegal and to prosecute financial crime.

Mobile network distribution models. The mobile telecom market continues to diversify in its distribution, with operators across a variety of networks offering a range of value added services for  voice, message, content, data, and so on. The prepaid and postpaid markets are becoming increasingly sophisticated and diverse in the use of mobile virtual network operators (MVNOs). Companies around the world tap Strand Consult’s center of excellent for MVNOs.

Strand Consult’s knowledge based upon ongoing research around the world is important for those who want to create value for consumers and shareholders. The mobile telecommunications industry and many of its outstanding leaders and professionals have a greater commitment to social responsibility than many of the politicians and regulators who are responsible for regulating the industry.’

2018 proved that the internet works well without heavy handed net neutrality regulation.
Strand Consult is proud of our research accomplishments in 2018 which has contributed to many academic and industry conferences around the world.  Strand Consult is honored to be invited to share its knowledge with an array of global stakeholders, including telecom regulators, boards of directors, financial analysts, journalists, industry professionals, professors, students, and the public at large. Strand Consult expert visit many countries to contribute to the evolution of the industry and its regulatory modernization.

Looking back at 2018, many claimed that the restoration of a light touch regulator framework with the Federal Trade Commission at the helm would break the internet. In spite of these prophesies of doom from the media, regulatory advocates, and elected leaders, the Internet is alive and well. Many claimed that heavy-handed preemptory rules by the Federal Communication Commission were required to ensure that internet companies would innovate. Strand Consult’s research has documented that a variety of policy instruments have worked to support innovation, including ex post antitrust enforcement, codes of conduct, multi-stakeholder models, and self regulation.

Policymakers around the world have grown increasingly weary of Google, not only for concerns around antitrust and data protection, but in its role to fund groups which advocate for net neutrality regulation and the loosening of copyright standards. In spite of the European Comission’s attempt to address Google’s anticompetitive behavior in the EU, BEREC continues to prioritize Google-funded advocacy groups in its net neutrality rulemaking. Indeed the vast majority of BEREC’s net neutrlaity proceedings are conducted in secret and behind closed doors. In 2018 Strand Consult has lead the way to demand that BEREC live up the EU’s transparency requirements. Strand Consult has made multiple requests for freedom of information and has had a dialogue with the office of European Commission President Jean Claude Juncker about the issue. Others have joined Strand Consult’s efforts. BEREC has promised to be more transparent in 2019, and Strand Consult is watching to see if promises are kept.

In 2018 Strand Consult published many research notes detailing how the EU continues to fall behind in the mobile telecom industry. There is an investment gap of €150 billion and the region is 2 years behind the US, South Korea and China on deploying next generation mobile networks. Instead of making policy that works, European politicians try to change the script, saying that instead of being ”first” in 5G that the EU will be ”best.” These delusions of grandeur remind us of the film “Monty Python and the Holy Grail” in which each of The Black Knight’s limbs are cut off and yet he still believes he can still fight. Watch

Looking at investments in Europe versus United States, it is clear that the right framework conditions can stimulate investment and innovation. The question is how long European politicians continue to promise dreams of 5G while they became a reality in the US and parts of Asia in 2018.

Strand Consult’s predictions proved right again in 2018
This year was Strand Consult’s 18th year in making predictions, and 2018 proved us right again. While many of our predictions are dark, we tell the truth. You can find the research notes we made in 2018.

It is unfortunate that many of our predictions of lost investment are negative for industry and society. At the same time many of these outcomes could be avoided if operators were better communicators.  On the positive side, our expectation is that the US will continue to be an environment that supports investment. The new leadership of the Federal Communications Commission (FCC) keep on focusing on closing the digital divide. We hope that regulators and around the world acknowledges the wisdom of the USA and not copy overregulated Europe.

Strand Consult’s review of the 2018 Mobile World Congress (MWC) created a lot of attention. We are pleased that we could focus on both the good and the less good things we experienced at MWC in Barcelona. We look forward to an exciting conference in 2019.

2018 will also be remembered for the increasing attention to network security and resilience. Strand Consult’s published a major research note ”The story behind the Huawei story”with the purpose of killing many of the myths that have animated the media about Chinese network equipment providers.

Conclusion – 2018 was a challenging year for telecom operators, creative people and innovative companies.
The year 2018 was interesting. The price of technology and traffic fell, and digital interfaces became even more user friendly. Many entrepreneurs try to innovate solutions that add value and spur adoption, but regulation continues to limit innovation, experimentation, and new business models.

The media’s coverage of the Huawei story looks like a politically-orchestrated car accident in slow motion. The media bills the story as a front in a US-China trade war, but this is wrong. The fear that Chinese information technology will be abused to put more regulation and regulatory cost on operators in 2019. The story of Huawei will have a huge effect on the global telecom industry and the rollout of 5G.

The Consumer Electronics Show (CES) in Las Vegas and MWC in Barcelona Mobile will set the tone for 2019. Strand Consult expects another exciting year and looks forward to contributing with compelling research and analysis to help its customers to navigate in a complex world. We also look forward to educating policymakers with a more realistic view of the industry.

We hope that our research note inspires you over the year. 2018 was Strand Consult’s 24 year in business and its 18th year in making predictions in which we try to inform, delight, and challenge our audience. We invite you two see for yourself whether we were right over the years.

Thank you for another great year. Merry Christmas and all the best for 2019. 


John Strand, CEO

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