As fireworks fill the skies tonight and 2013 comes to a close, it seems a good time to reflect on the current state of the telecoms and ICT industries, and what has changed in the last five years. Having just participated in the 2013 ITU Telecom World Conference in Bangkok, this gave me the opportunity to assess whether the Digital Renaissance that we at KeySo Global have being predicting has in fact transpired.
In 2009 the world was reeling from 12 months of global financial turbulence and anxiety levels were high. WiMAX was causing angst for U.S. carriers and the iPhone was forcing the rethinking of how Wi-Fi and cellular could effectively inter-operate. Data congestion on overloaded 3G networks designed for voice was reaching critical levels as operators adjusted to the realities of YouTube video upload and downloads. The European markets and technology suppliers were firmly in control of the industry, with Nokia the dominant handset supplier controlling 38% of the 1.1 billion phones sold that year. Apple, on the other hand, was gaining credibility and achieved a respectable 2%. ICT was the main theme of the conference as cellular held center stage with 67% market penetration, having enabled 4.6 billion people globally to have access to personal communication capability. In 2009 the prime discussion, therefore, was around internet connection and the role that mobile could play here.
Fast forward to the 2013 conference in Asia and the global economy, having experienced five years of unprecedented instability, is still in a volatile state where virtually every treasured economic rulebook has been proven ineffective in controlling a 24/7 interconnected digital world. This has been facilitated in part due to cellular penetration reaching 96% and 6.8 billon people having access to cellular – 3.5 billion of whom are in the Asia Pacific region. More significantly, the number of people now online has increased from 26% to 39%. The single biggest contributor to this has been mobile broadband access which has grown from below 10% in 2009 to 30% penetration this year. This growth is closely tied to smartphone growth as well as the availability of lower cost data packages. In 2009 smartphones accounted for approximately 10% of handset shipments, whereas in the 3rd quarter of 2013 smartphones totaled 250 million units, over 55% of total phone shipments that quarter. The biggest loser in this dramatic shift in emphasis towards smartphones and operating systems has been Nokia, but others such as Sony Ericsson, Kyocera, Sharp, Rim, HTC and Motorola have been damaged along the way, to greater or lesser degrees, by the shift to an Android world.
In conclusion, we are living in a far more connected world than we were five years ago. However, the extent to which the interconnection of this increasingly complex human digital and physical world is understood is limited and the ripple effects of these technologies on industry structures have only just started to appear. Telecoms and ICT are certainly not immune to these, as we have seen, but within the next five years we will see the boundary industries of automotive, medical, retail, utilities and manufacturing become increasingly subject to the transformative effects of the mobile internet.
Of greater interest will be the unanticipated consequences that will undoubtedly emerge from the mobile internet and Internet of Things blending with big data analytics, and the unavoidable impact this will have on digital life and behaviors. As an increasingly urbanized planet adopts these technologies to facilitate ever smarter cities, the opportunities for ICT to make a difference to societies are colossal – but the question is how to bring the people along with these changes, and instill trust in them that technology will be used for good and that ethical government will prevail? Clearly, the recent Snowden revelations on the NSA and other agencies have given everyone pause for thought.
As we enter 2014, it is clear that the Digital Renaissance is technically well underway but the structural and behavioral implications are only just beginning to emerge and, when they do surface, I suspect that the predominant challenges we face will be societal. In shaping the future of this brave new world we need to engage its citizens, understand their needs and manage the “Faustian bargain” that will be a fine balance between a surveillance state and the right to privacy. None of these challenges are unsurmountable but they are ones that will need careful monitoring, open conversations and perseverance on the part of governments, industry and citizens around the globe.
Steve Bell, President, KeySo Global