The era of telecom subservience is nearly over. It’s routine to hate on the telecom providers your operations depend on, but new technology finally makes our collective exodus from telecom providers possible. Their failure to adapt over the next 5 years will make them subject to your bidding. The deluge of telecom alternatives and the new technologies taking them on are here to stay.
Understanding Telecom Alternatives
The data paints a striking picture indicating the telecom carrier world as we know it is ending. The symptoms have intensified in the last few years, as layoffs have cascaded across Verizon, AT&T, and Centurylink. In March, millions of customers began looking for Windstream alternatives as the company announced their bankruptcy filing plans, and other telecom providers are selling their assets for pennies on the dollar to cloud-based companies.
It’s not just about dollars and cents however, the strain experienced by telecom companies is being felt directly by CTOs, CIOs, and consumers alike.
Large regional connectivity outages are occurring more and more as technical resources become scarce across low-margin assets. Carriers have become silent at worst, and at best sluggish, as they respond to outages while their clients sit in the dark. This leads us to all ask the question, in a market where businesses are crying for more connectivity and more bandwidth, why are telecoms suffering? Don’t most businesses thrive as demand increases?
There are three main drivers contributing to this significant downturn in the carrier world, all of which are tech-related. 5G, SD-WAN, and native cloud services. All are highly beneficial for tech leadership and stand to threaten telecom business (and relevance) around the world, leading of course, to better telecom alternatives.
5G Will Disrupt Telecom
Organizations have been using wireless networks inside their offices for years. Outside the office, they’ve been using spectrum for mobile connectivity. Those lines are blurring and will soon be gone entirely, however.
4G LTE was adopted heavily across the retail industry, but only as a backup solution. This has been the case for over 3-years now, but now spectrum’s backup designation is being questioned. As 5G arrives, especially during times of increased outages and lackadaisical customer service, CIOs and CTOs are looking at wireless 5G as a viable, large-bandwidth, low-latent and even primary data connection.
Tech leader’s desire to use 5G as a primary connection is likely to disrupt traditional carriers, but it’s not just about bandwidth accessibility. Wireless 5G offers speed to deployment in 7 to 10 days instead of 45+ days. Serviceability is also a draw because the main points of failure for a wireless connection are the cellular towers and the 5G wireless router.
A few telecoms and carriers have realized this disruption coming to the wireline carrier market, which is why carriers like AT&T, Comcast, and Verizon have doubled down on cellular investments. But it might not be enough to keep the padded market share they’re used to.
SD-WAN Will Disrupt Telecom
In addition to 5G capabilities cutting into telecom market share, Software-Defined Wide Area Network, or SD-WAN technology is providing customers with new unexpected connectivity choices, turning heads of CTOs and CIOs across the world.
Up until the last few years, organization networks could only rely on expensive, low-bandwidth MPLS networks or complicated, backhauled VPN tunnels in an effort to stay connected and keep the company’s data secure. Any CIO or CTO knows it’s expensive and complicated to manage and maintain. This tech, especially Gen 2 SD-WAN, is a clever way around these issues giving us a clear picture of tomorrow’s telecom alternatives.
SD-WAN technology gives customers the option to leverage multiple cheap network connections (broadband, DSL, dedicated internet, etc.) securely, alternating seamlessly and securely between all of them.
Businesses get secure connectivity, more bandwidth, better uptime as multiple circuits are present, and more options for connectivity—no more reliance on the carrier community. New technologies or connectivity options can be utilized immediately.
Cloud-Native Services Will Disrupt Telecom
The final cause for telecom disruption is the cloud. Cloud adoption has spiked over the last few years as productivity tools (Microsoft Office 365, G-Suite); ERP and CRM applications (Workday, Oracle, S4 HANA, Salesforce, Dynamics, etc.); and PBX/Phone Systems/Contact Center (Cisco HCS/Broadsoft, Microsoft Skype for Business/Teams, Avaya, Genesys, etc.).
You would think that this mass migration to the cloud would cause an increased need for carriers and telecoms. After all, how else would users and organizations be able to consume applications without carrier connectivity?
The companies in the background, such as Equinix, now housing these cloud-native applications, have subtly built data superhighways across the globe that companies are able to use at 1/10 of what it costs from the carriers. The only caveat (for now) is that customers need some type of cheap connection from their site to the closest Equinix POP (Point of Presence).
With critical product companies moving traditional on-premise applications to cloud consumption applications, the necessity for traditional telecoms and carriers networks becomes irrelevant as customers’ environments do not reside within their “four walls” anymore.
Telecom Alternatives and The Next Frontier
5G, Gen 2 SD-WAN, and Cloud-Native services will significantly speed up disruption. Better telecom alternatives will continue to change the landscape. Customers will realize they are no longer dependent on the expensive networks that carriers built out across the globe, at great expense.
As bandwidth and connectivity demands skyrocket, the only windfall traditional carriers will experience is the chill of being left in the cold. The environment has changed, and the customer’s needs have changed along with it.
Eric Skeens is the co-founder of 3 Tree Tech in Portland. He is a platform-agnostic tech researcher that transitions siloed organizations into automated DevOps centric businesses. Message him right here.