Analysis of global roaming traffic by Syniverse shows that 4G LTE roaming traffic from the Asia-Pacific region to other regions in the world grew a staggering 317% in the last year.
BICS has a similar upbeat message. Their research shows that “international LTE calls made between countries within the Asia-Pacific region accounted for 30% of international LTE traffic in the region in 2017”. Perhaps not surprisingly the top destination for outgoing roamers from Asia-Pacific was Western Europe.
These two companies, part of whose job it is to transport traffic and route that traffic between different networks are presumably breaking open the champagne, since they make their money out the networks themselves. And quite right too.
The challenge, of course, is not how companies like Syniverse and BICS make money – they are doing a fantastic job of that.
Indeed, they are partly responsible for roamers not switching off their data while travelling. In fact, according to Malcolm Chan, managing director for Asia-Pacific at BICS, “Contrary to established belief, Asian consumers no longer want to switch off their phones or buy local SIM cards when travelling overseas. This is because subscribers increasingly want to enjoy data services abroad as they would at home.”
This reflects a global trend, and as roaming charges become old-fashioned and a thing of the past, it will take 4G, 5G, IoT and every other G traffic to the levels that recent press releases hope it will go.
So, the challenge – actually two challenges … actually two major problems – is that not every network is 4G, and not every operator has a clue which business models make sense in the IoT and 4G/5G arenas.
Syniverse’s analysis might illustrate a strong growth rate for 4G LTE usage but it also reveals that “the majority (57%) of roaming traffic exported from Asia Pacific in 2018 is still traversing older network technologies, like 3G”.
This means there is an “urgent need for service providers to increasingly focus on enhanced network capability before Asia Pacific can move forward with global rollouts of new technologies, like 5G, that will fuel the future of smart cities and internet of things (IoT).”
And while the GSMA itself might be bullish about IoT and believe that Asia Pacific will be the largest region of IoT revenue, reaching $386 billion by 2025, it is still far from clear who will actually make that money.
That sinking feeling we’re experiencing is because we are increasingly realizing who will not.
The conclusion has to be that operators still have a long, eye wateringly expensive way to go before anything like ubiquitous 4G is achieved (let alone 5G). They are genuinely struggling with where the business will actually come from. And with OTT video fast becoming ubiquitous, the problem becomes very real and very present.
There are, of course, many ideas around as to how to monetize 5G but the reality still seems a long way off. Operators carry other people’s videos, stream your favorite World Cup games, enable kids to play multi-player games (that probably herald the next age of warfare), but only sporadically come out with some bundle or offering that makes sense.
Worse still, when roaming charges were the norm, companies like Expedia were prepared to pay the roaming charges so that, for instance, Vodafone’s customers could keep their data turned on and continue to use the full service while out and about on holiday or business.
As noted, there are ideas – many from the Asia Pacific region – and some examples out there (mainly in the enterprise space), of how operators will recoup some of the massive investment, but they are not enough. Not by a long shot.
We need, urgently, to gather people at the decision-making level of every part of the digital ecosystem and work this out. Otherwise, the only solution may be too radical for businesses to countenance.