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The future of mobile data post-Brexit

Lorrin White, managing director of Bamboo Technology Group, wonders if price rises will be the silver lining for UK telcos hungry to invest in their networks?

If I were to tell you that the rise in mobile connections is set to continue, I very much doubt you would be surprised.  In fact, you might even stop reading any further.  But please bear with me a little longer.

As mobile users, we all want to do more on the move, wherever and whenever.  I know I do – and as for our children, our own very special digital natives, forget SMS or call bundles, data allowances are everything! 

The number of 4G subscriptions is rapidly increasing all the time.  We expect (or even demand) the same speed and ease of use from our phones, tablets, wearables and other devices as we would at home or in the office. 

The M2M market is also going through exponential growth, and we are only seeing the very beginning of this technology in our everyday lives.

These trends are being reflected in both the consumer and business markets, but the long term implications of this growth and change in behaviour have their own technological advancement barriers.

In short, mobile networks MUST continue on their path of investment and development.

Data costs affect everyone.  And we all want more for less.  Whilst we may want to take comfort in the fact that EU regulation has held controls on charges since 2007 - and is still following the route of completely abolishing roaming costs by 15th June 2017 (albeit with some hiccups along the way) - we should also remember that EU regulations do not work in the same way as EU directives. They are not specifically incorporated into UK Law.

If, or when, Article 50 is invoked and the conscious uncoupling begins, we must take leave to consider which directives may be retained and which might be culled. The question of UK or EU policy control remains at the forefront of the outcome.

But the bigger question is this; Post Brexit, will EU regulations on costs be upheld?

Currently at least, the one certainty of Brexit seems to be uncertainty, so let’s imagine for a moment that two years on, Britain has left the EU and opted out of roaming regulation.

A backdrop to all this that cannot be overlooked is the declining rate of investment among European MNOs in their infrastructure in light of ever-declining revenues. An IDATE study for Ericsson and Qualcomm on Mobile Operators’ Investments tells us ‘EU MNOs are investing as much as they can, but their declining revenues simply prevent them from keeping up in the innovation and investment race with other regions.’

Could this therefore provide UK operators with an opportunity to invest in their networks and become global leaders?

It is likely that the first network to increase their prices could be very exposed in a resolved market.  Until the others follow at least.  Yet we have to remember that they are operating in an industry that needs significant ongoing investment to meet demand, availability and behaviour. So a domino effect seems likely.

Could investment in UK mobile infrastructure be the overlooked silver lining?  Freed from their EU obligations to eliminate roaming charges, UK operators would be free to increase their prices and invest more significantly in their networks. Where will this investment otherwise come from if the industry continues to reduce its mobile pricing - or moves towards hybrid, free of charge Wi-Fi solutions?

Or will our telcos simply look elsewhere for additional revenues?

Whilst some networks are moving ahead with quad play strategies to secure additional ongoing revenue, one has to wonder if this market will eventually be driven down on price too. There are already concerns being borne out with European telcos at the IBC Show bemoaning the burden of having to invest in infrastructure.  Coupled with concerns that there are no profits to be had by combining TV and Telecoms services, we can only watch and wait to see whether this proves to be a step too far for telcos or a sigh of ROI relief. Will our UK telcos who have registered as On Demand Service Providers be following suit or waiting for Brexit to play out?

Either way we are left with significant uncertainty over the future of mobile networks, charging structures, data costs (and roaming costs too) and strategies. One thing we do know though is that nobody likes surprises, meaning data monitoring tools, automation of controls or notifications and tariff optimisation become key.

Whether our mobile network operators continue to push forward in a bid for cellular dominance, pursue the quad play sell or move their strategies into the investment of Wi-Fi collaboration, the monitoring of data, the management of spend and the ability to react to behaviours, threats and needs will dictate service wrap and investment priorities.

The biggest question, as ever, remains in the hands of those negotiating our exit from the European Union. Until we know the result, data monitoring and automated tariffing solutions looks set to be an attractive – if not essential – proposition going forward.

Bamboo (formerly Total Ltd.) is an ICT provider.

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