The Future of Telecom is delayering

I read the interview McKinsey did to the CEO of Telefonica. The key takeaways: telecom delayering, network APIs and charging over-the-top players for network capacity. In 2006 I was working on implementing services on top of Parley-X, a set of standard telecom APIs. Twilio some years later had a much simpler solution. No telecom invented API has any broad adoption beyond the telco industry, whereas Twilio has. Previous telecom CEOs have been talking for more than a decade about charging over-the-top players for maintaining their networks. Delayering telecom networks is a fancy name for separating the bit pipe business from the rest. An idea that telecom operators have been fighting for decades. Basically the telecom industry is starting to run out of ideas on what to do next. Guess 5G hasn't been the big money maker the industry wanted investors to believe?

Here is what will happen if the telecom industry does nothing.

Do nothing

Starlink will expand capacity globally till the point they can service all rural areas in the world and on the sea. SpaceX will be able offer services to anybody not living in a city or a suburb and anybody or thing navigating a vehicle on land or sea. By creating dual protocol mobile devices, a phone will both connect to 5G and Starlink. 5G in cities, Starlink in rural areas. Cars, trucks, trains and boats will by default connect to Starlink and offer WiFi to its passengers. The future of WiFi and broadband networks will include decentralised identity so we can stop needing to know WiFi keys and just transparently roam between third-party WiFi, 5G and Starlink.

Web3 is bringing the possibility for both individuals and companies to buy hardware and offer mobile broadband to others at a micro payment for usage based business model. Add the possibility to rent mobile broadband spectrum on demand and 5G networks can become completely decentralised.

By separating fibre to the home/building deployments and fibre network operations from the other telecom services, cities and suburbs can have a fast backbone on which mobile base stations and WiFi access points can be connected.

By adding a layer of AI and smart contracts to manage connectivity, spectrum, and so on, the future of telecom networks can become a decentralised ecosystem of companies and individuals which provide data connectivity services via WiFi, mobile and satellite.

What will not be included?

Having a mobile number. This never was a great and secure identifier to start with. A decentralised ID [DID] will do the job a lot better.

A SIM card. We do not need hardware to store keys and USSD apps. A Web3 set of public/private keys to access a crypto wallet type of address will do.

SMS and calls. WhatsApp, Messenger, Telegram, Signal,... are better.

A monthly invoice based on a data tariff with opaque roaming charges is also obsolete. Instead we spend tokens every time we use data and earn tokens every time somebody connects to any of our WiFi or mobile base stations. Most people would just pay to use data. Some will work hard on adding more base stations to optimise token earnings.

All of this can be orchestrated as soon as Elon Musk's SpaceX buys Helium or starts a similar venture.

Conclusion

Customers are likely going to get better mobile broadband if WiFi, 5G and Starlink are combined. SpaceX has the knowledge and skills to become the first decentralised global telecom operator. Fibre and backhaul companies as well as anybody willing to run a WiFi or 5G base station can generate revenues. The rest of the telecom industry will no longer be needed.

What do you think of this telecom delayering strategy? Did I just help McKinsey sell more projects? ??