As in every year for the last 29, the start of the new school year goes hand in hand with the Digital Economy and Telecommunications Encounter in Santander. This forum has evolved over the years, always bringing together year after year the top stakeholders who help us to focus on the key issues and take the pulse of the sector as a whole.
This article aims to sum up the main ideas mentioned in the forum.
The general, probably unanimous view is that we are now smack in the middle of a new industrial revolution. The evolution of the technological landscape in recent years (reduction of costs, increase of capacities, etc.) is fueling an explosion of new business possibilities based on IoT (Internet of Things) plus Big Data. The smartphone has become part and parcel of all our daily lives, playing the role of today’s remote control.
This is a new breathtakingly fast-moving scenario. Never has it been so easy to build a business from an idea, but the competition enjoys the same advantages. Changes are continuous and cycles much shorter. Some there are who make bold to predict that 40% of dominant firms in all sectors will lose this position over the next four years!
The advent of OTT firms (Facebook, Google, Amazon…) has changed the ground rules completely. These are genuinely global firms selling directly to the end client, without middlemen, posing a serious threat to other companies running on a more “traditional” business model. The new global ITC market is more uniform than ever; users all over the world tend to take up the same usage habits, interests and applications across the board.
The major Telco operators are seeing their revenue quickly shrink while still being obliged to keep up a big outlay. These investments are key to the future consolidation of today’s bubble. There will be an ever greater need for bigger-capacity networks (4G+, 5G,…) and new technologies providing top-quality, secure and trustworthy access.
Europe in the new world
A vision shared by practically all speakers is that Europe is lagging behind. European companies that were world leaders 10 and 20 years ago (Ericsson, Nokia, Siemens, Alcatel,…) have found no one to take up their baton. The benchmark business models of this new ITC market have to be looked for in Asia and, above all, in the United States.
And the problem seems to be not so much technological as political. The day to day reality of Europe is that there is no single market but a scattering of overly-small markets hemmed in by barriers and patchwork legislation. The program launched in May for the creation of a single digital market seems to be heading in the right direction but there are serious doubts about how it will actually pan out and, above all, the deadline. Uncertainty in the regulatory framework is a huge millstone. There would seem to be a need for less regulation that is more intelligent, more uniform and, above all, quicker.
In this scenario we run the risk of most research falling outside Europe and the investment in future technologies following suit, with the ensuing damage to the European industry. At the current pace of things we would seem to have little time to lose.
Opinions about Spain’s market are fairly upbeat on the strength of the good figures of recent quarters and the upward market trend.
During these years of economic downturn the main operators have kept up a high investment level, redounding in a constant improvement of Telco infrastructure in Spain (3G, 4G, 4G+, fiber optic,…). Spain’s society also seems to be one of the most active in the takeup of new technologies.
Nonetheless, most of Spain’s firms have yet to finish or even start their digital transformation. There is a perhaps a need for a more propitious environment for this development. The economic upturn will undoubtedly help, but there is also a need for clear and stable rules (European or Spanish) that drive the development of today’s firms and, above all, favor the appearance of new ones with a new, totally digital DNA. A call even went out for political parties to come up with a clear commitment and specific actions for the next legislature.
As in every year there were complaints about specific legal lacunae and grey areas. Clarification is particularly needed on whether or not to allow the purchase of Digital Plus by Movistar and whether it should be forced to share broadband access. The legal difficulty here is to achieve a sufficiently stable market to manage two things: ensuring that investing operators can recoup their investment (and thus continue to invest) and that the market is sufficiently competitive to allow users to choose from different offers (competing fairly in terms of price and quality). Striking this balance is no easy matter and there are all sorts of opinions on the matter. Only time will tell if the decisions being taken are the right ones.
A counter call went out for companies to quit “complaining about the referee” and get down to transforming themselves and innovating.
One of the hottest issues tackled was the importance of security in this new environment.
New possibilities are also cropping up in the world of cybercrime. As one of the speakers quite rightly said “the wrongdoers have already carried out their digital transformation”. All of a sudden there are new threats we are not yet accustomed to and, initially, have no idea how to ward off.
Except in sectors where security has always been a priority (e.g., banking), this issue has often been tackled as a secondary concern. Security needs are bound to soar exponentially in coming years.
And here is where we all need to do our bit. Legislation will have to come up with a clearer definition of the new types of crimes; all companies will have to implement necessary measures in their systems/processes; most importantly of all, all we users will have to understand the new world with its new threats.
I take from this forum a telling phrase made by one speaker: “However worried you are by security, it’s not enough”.
Author: Crescencio Lucas Herrera
Las opiniones vertidas por el autor son enteramente suyas y no siempre representan la opinión de GMV
The author’s views are entirely his own and may not reflect the views of GMV