Telecom operators in the GCC region could gain significantly from the spread of blockchain technology if they can develop and offer innovative blockchain-based services to clients in multiple vertical markets.

However, these operators will need to understand the blockchain value chain and carefully analyse their strengths in each area.

Before rolling out a chosen strategy, operators should assess the status of the blockchain market to see where the opportunities lie. They can use their attributes and capabilities to gain internal efficiency, such as improved handling of data, or to attract external clients, such as by enabling new business models.

But how are regional telecom firms faring compared to the global players who have ventured into this space, such as NTT Data and Swisscom?

“As blockchain is still in its nascent phases, regional telecom firms have been conservative in their adoption of blockchain,” Imad Atwi, Principal with Strategy&, told Zawya.

“Many regional telecom firms are still awaiting both technology and market maturity; others have started testing pilots for specific use cases while partnering with key blockchain technology service providers. Nevertheless, regional telecom firms are starting discussions to potentially take a more strategic and proactive approach in shaping the blockchain ecosystem.”

“Telecom operators have to adapt,” said Jad Hajj, a partner at Strategy& Middle East. “They must carefully analyse their own capabilities before selecting their value proposition and a target market. A portfolio of relevant use cases for each target market is needed for more effective marketing and business development.”

The fact that blockchain technology is yet to mature into a standardized and widely adopted value proposition could also be an important factor deterring telecom firms from actively adopting it.

“There are multiple factors preventing telecom firms from fully pursuing blockchain opportunities,” Atwi noted. “Blockchain business models are yet to be fully tested, which hinders adoption at a mass level. […] Customer education and awareness is critical in the adoption of any new emerging tech, specifically blockchain. Also, forward-looking enabling regulations that are specific to blockchain use cases need to be put in place, from crypto laws to privacy laws.”

In one of its reports published last week, Stratgey& has identified five ways to optimize operations and improve service delivery through blockchain technology:

  • Identity management

Telecom operators can use blockchain to streamline identity management to prevent fraud. By storing customer identities on the blockchain, authentication and validation of services become faster, more resilient, and more efficient.

Telecom operators can also extend access to blockchain-based customer identity records by building an ID-as-a-Service (IDaaS) offering. This is an authentication infrastructure that is built, hosted, and managed by a third-party service provider. This offering will be useful for the digital services platforms, such as customer relationship management or billing, which telecom operators are already building.

  • Number portability

Telecom operators can register their number-portability database on blockchain to facilitate lookups and portability transactions, and reduce the costs of these transactions. Blockchain would complete the transfers faster, with minimum disruption to subscriber service, and eliminate the reliance on third parties or on potentially time-consuming and expensive integration efforts to connect to different operator databases.

  • Roaming

Blockchain can facilitate roaming services between multiple operators as it can check subscriber permissions to determine if a user has the right to roam. If the user can roam, then blockchain gives the subscriber access to the host network and creates a smart contract to track the roaming service charges.

When a user roams, this generates a Call Data Record (CDR) for network usage, which is published anonymously and securely on blockchain. The smart contract can then calculate the charge for the call and settle the charge between the operators automatically.

  • Customer experience and service-level agreements (SLAs)

Blockchain’s smart contracts can improve SLA monitoring and customer experience. Smart contracts can have service levels and the associated rewards or penalties coded into them so that they execute automatically and autonomously. They thereby apply any penalties or grant rewards in line with the SLA. Blockchain’s immutability prevents any changes or tampering with the record.

  • Smart bandwidth metering

Subscribers can use blockchain to monitor what data service providers are selling them in real time, and then compare this to their permitted quota. They can then deal with any overselling and make any necessary adjustments.

(Reporting by Seban Scaria seban.scaria@refinitiv.com, editing by Daniel Luiz)

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