Telecoms_com_Annual_Industry_Survey_2020_Final-1

1 . TELECOMS.COM INTELLIGENCE ANNUAL INDUSTRY SURVEY 2020 REPORT Sponsored by 

2 .Contents 03 / Introduction 05 / Industry Landscape 08 / 5G 12 / Broadband 16 / Digital Transformation 20 / Intelligence at the Edge 24 / Security 28 / Appendix – Survey Results 

3 .With resolution and defiance, the telecoms industry is standing firm in adversity Dear Readers, W elcome to the Telecoms.com 2020 Annual Industry Survey report. However, while facing the most difficult times in decades, the telecoms industry has demonstrated strong resilience in what Meanwhile, palpable optimism and confidence can be felt from the survey responses when the participants were looking ahead towards “Unprecedented” has already become a we do. The worry at the beginning of the what is to come next. Over three-quarters of cliché to describe 2020, but this does not pandemic, that telecoms networks might the respondents had a positive outlook for the Wei Shi make it any less true. About a year ago, when we published the 2019 report titled “looking forward with confidence,” none of us could not be able to pass the traffic spike test caused by vastly increased remote work and home entertainment demand, has proved telecoms industry in 2021. They have a strong belief in the role that Content Manager Telecoms.com Intelligence have predicted what would be lying in wait for unfounded. 5G, broadband, digital transformation, us this year. edge computing, security and many other Many innovations have been developed telecoms sectors will play in both driving the COVID-19 has wreaked havoc on millions to help corporates run their business as recovery and propelling new growth. of lives, inflicted serious damage to the smoothly and as securely as possible. Even world economy, and negatively impacted a new technology rollout has not seen too So, once again, it is our privilege to share the countless businesses, including many in the much delay. Over 100 operators in more than onward and upward journey with you and communications industry. Over 40% of the 40 countries have switched on commercial we hope you find the 2020 Telecoms.com telecoms professionals responding to this year’s 5G services by the end of Q3, up from 70 Annual Industry Survey enlightening in this survey admitted that they have felt the pain. operators and 30 markets in July. testing time. n London, 19 October 2020 Annual Industry Survey 2020 3 

4 .Survey Response Snapshot What impact has COVID-19 Howdoyou ratethe Survey Respondent Breakout had on business this year telecoms industry's performance in 2020 NEGATIVE IMPACT 44% EXCELLENT 13% OPERATORS VENDORS SYSTEM INTEGRATORS HAS HELPED BUSINESS GOOD 32% 21% 20% 15% 54% How do you feel about the Where should the industry focus What investment is the highest outlook for 2021 Investment over the the next 3 years priority for your business in 2021 VERY POSITIVE 31% INITIAL 5G DEPLOYMENT 68% 5G SOMEWHAT POSITIVE FIBER (FTTX) DEPLOYMENT PROJECTS 51% 64% 46% 5G DENSIFICATION 40% Do you think Digital Transformation What is the driving demand for What impact does edge computing Investment will change during 2020 broadband to continue growing currently have on digital transformation INCREASED INVESTMENT 22% TELECOM OPERATOR NETWORK EDGE NO CHANGE VIDEO-BASED “WORK FROM 48% 54% APPLICATIONS HOME” TREND 36% 23% Annual Industry Survey 2020 4 

5 .INDUSTRY LANDSCAPE KEY TAKEAWAYS • More than four in ten see their business negatively impacted by COVID-19 Despite the strong headwind of COVID-19, • Over three-quarters have positive outlook for telecoms in 2021 participants in the survey are confident in • 5G tops both industry’s and individual businesses’ both their own capability to weather the storm investment priority lists and the communications industry’s capability • Delay in new technology rollout and pressure on profit are seen as biggest threats to come out the other end in strong shape. Annual Industry Survey 2020 5 

6 .INDUSTRY LANDSCAPE As usual, this year’s Telecoms.com annual industry survey started by gauging Figure 1-1:How has COVID-19 impacted your company? the participants’ sentiment and attitude towards the overall industry landscape. It gains special importance in this special year and sets the scene for the subsequent sections of the survey which would dive deeper into We have been negatively individual topical domains. impacted by COVID-19.................................... 44% COVID-19 has no or negligible impact on us...................................................... 36% Once again, the survey attracted experience in telecoms, including living room is obviously COVID-19. We have done better during COVID-19 than we would normally do......... 15% high enthusiasm from the industry. 30% having spent over 25 years in Unfortunately, though not surprisingly, Well over 500 telecoms professionals this industry. Meanwhile, 11% of all many businesses have felt the pain Other .....................................................................5% responded during the three weeks respondents joined the industry not of the pandemic. The biggest group, it was open, on par with the level of earlier than five years ago, the highest 44% of all survey participants, said responses of last year. The biggest representation of this group in this their companies’ business had been group of them, 32% of total, came survey’s history. In terms of location, negatively impacted by COVID-19. from communications service three-quarters of all respondents Meanwhile, 15% of the respondents Figure 1-2:How would you describe the telecom industry’s overall business providers (including virtual operators), were based in Europe (37%), North said their business had done better performance so far in 2020? followed in second place by those America (20%), and Asia-Pacific (17%), during the pandemic than they working for vendors (21%) and in where the vast majority of the live normally would do. Many of them third place consultants and system 5G networks are operating, while the worked at different types of service integrators (20%). representation of Africa, the Middle providers, which had benefited from Excellent............................................................. 13% East, and South America reached the rising demand for their services. When it comes to the job functions 26%, up from less than 24% a year More than a third of participants in Good.................................................................... 54% of the survey respondents, the largest ago. the survey said the pandemic has had Average............................................................... 24% group were mid-level management, little impact on them. Below average......................................................7% at 21%, followed by C-level executives Therefore, we can say the respondent Poor........................................................................2% which accounted for 18% of the body was a fine mix of technical and Despite COVID-19’s negative impact total. Technical functions, including non-technical professionals, of senior on the economy in general and on engineers, developers, network executives and operational experts, many of the businesses represented in operators, and IT management and IT of mature and emerging markets, the survey, the telecoms professionals operation staff, accounted for 26% of and of experience and fresh ideas. gave a more positive rating to the the total, while 17% of all participants Not only are the participants close to overall performance of the telecoms in the survey were working in sales and marketing. the heartbeat of the industry, many of them are the heartbeat of the industry in 2020. Almost seven out of ten respondents said the industry’s “WHEN LOOKING AHEAD TOWARDS THE industry. business performance had been either INDUSTRY’S PROSPECTS IN 2021, THE Many of the respondents were industry veterans, with nearly half When we look at this year’s industry excellent (13%) or good (54%). Another quarter of respondents said the SURVEY PARTICIPANTS SHEWED AN EVEN (49%) having more than 20 years’ landscape, the elephant in the performance had been average. STRONGER OPTIMISM.” Annual Industry Survey 2020 6 

7 .Along similar lines, the industry in the survey identified initial 5G vehicles (38%) but was just edged professionals also looked back on Figure 1-3:How do you feel about the telecom industry’s business outlook for 2021? deployment as one of the telecoms out of the top spot by the number of their own companies’ performance industry’s investment priorities in survey participants selecting AI and this year with general approval. the next three years, ahead of all ML (41%). The biggest group, 41% of the Very positive.........................................31% other investment targets. A further total, thought their company had Somewhat positive.............................46% 40% also chose the densification When it comes to the threats performed at a similar level as the Neutral...................................................15% of existing 5G networks, and 33% perceived by the communications industry as a whole, while a third of for the deployment of standalone industry, two items stood out: 24% Somewhat negative.............................. 6% all respondents believed that their mode 5G. Other leading candidates of the respondents saw the biggest Poor.......................................................... 1% company had outperformed the selected by the industry professionals threat in the failure to roll out new industry by a small margin, and a Very negative.......................................... 0% included fibre (FTTx) deployment technologies fast enough, while 22% further 12% by a big margin. (51%), virtualisation (46%), and next- felt most threatened by the increased generation access technologies pressure to lower prices and profit The positive assessment of the (38%). margins. There is a strong consistency business performance of the industry in this result over the last few years. and of their own companies could 5G also topped the 2021 investment In comparison, competition from OTT be read as a belief among the focus list of the survey respondents’ services and hyperscalers, which had survey participants that the telecoms own companies, selected by 64%. It been seen as an almost existential industry has been able to pull off the was followed by investment in cloud threat until recently, was relegated best out of the worst. and digital transformation, at 42% to the same level as the lack of Figure 1-4:Which of the following are likely to be the telecoms industry’s priority investment areas in the next three years? (choose all that apply) each. Security, IoT, virtualisation, and demand from business customers When looking ahead towards the artificial intelligence (AI, including and regulatory restraints, all selected industry’s prospects in 2021, the survey 100 machine learning or ML), were all by 8% of all survey respondents. participants shewed an even stronger 90 selected by more than one-third of optimism. Over three-quarters of 80 all respondents. In summary, despite the strong all believed the telecoms industry’s headwind of COVID-19 against 70 business outlook would be positive Probably inevitably, when a the overall economy and despite 60 Percentage (46%) or very positive (31%). A cynic technology makes the headlines and its negative impact on many could attribute the optimism to 50 makes high promises but has not yet businesses represented in the survey, the belief that things could not go 40 delivered on all of them, especially participants in the survey have any worse. On the other hand, the when the ROI is not yet compelling, demonstrated a strong confidence in 30 positive sentiment could also come it will be met with scepticism. 5G both their own capability to weather 20 out of the confidence that many new obviously falls in this category (see the storm and the communications technology and business drivers, on 10 the next chapter for detailed analysis industry’s capability to come out top of the expected macro recovery 0 of the responses to questions on the other end in strong shape. Fiber (FTTx) Initial 5G deployment deployment Virtualisation 5G densification Next generation access technologies Standalone mode 5G deployment Other from the pandemic, could continue to 5G), so do some other industry 5G, broadband and many other push the industry forward. buzzwords. When asked to select technologies will continue to catch the most overhyped technologies, the industry’s imagination and to One such key driver is apparently 39% of all respondents went for 5G. It attract significant investments in the 5G. A total of 68% of participants was narrowly ahead of autonomous coming years. n Annual Industry Survey 2020 7 

8 .5G The industry has carried 5G’s strong momentum to the migration towards the KEY TAKEAWAYS advanced phase of 5G. However, to deliver • Deployment of virtualised 5G core is already underway on the high promises of the technology, • 5G deployment on C band has broad appeal especially those value propositions to • The industry has strong enthusiasm for adopting Network Data Analytics Function (NWDAF) business customers, telecoms industry • While going cloud native, network functions are most stakeholders need to navigate and overcome likely to remain on private cloud a broad range of challenges. VIAVI Solutions is a world leader in both network and service enablement and optical security performance products and solutions. Our technologies contribute to the success of a wide range of customers – from the world’s largest mobile operators and governmental entities to enterprise network and application providers to contractors laying the fiber and building the towers that keep us connected. With the deep expertise necessary to deliver unparalleled physical and virtual network intelligence, VIAVI Solutions helps service provides, enterprises and their ecosystems to deploy, maintain, optimize and evolve the most complex and powerful networks on the planet. As pioneers in fiber testing and characterization, VIAVI has a long history of successful collaboration with communication companies to help make our lives rich and productive by supporting networks that connect and entertain people as well as enhance security. Annual Industry Survey 2020 8 

9 .5G A year ago, when Telecoms.com was conducting its 2019 annual industry When asked about their plans for survey, we noted the biggest landscape change of the year was 5G going C-band 5G deployment, over half live commercially. One year on, 5G’s momentum has kept getting stronger. of the survey respondents whose business is related to 5G rollout had According to the tracking by GSA, an industry organisation, by the end of Q3 either already started the deployment this year, over 100 operators in more than 40 countries have launched 3GPP- (25%) or were planning to start within compliant 5G services, including mobile and fixed mobile access services. a year (28%). A further 27% of the respondents said their companies would start the deployment within With the completion of 3GPP’s Release deployed virtualised 5G core (30%) two years. 16 Stage 3 work at the beginning or were going to deploy it within Figure 2-1:When do you plan to deploy a virtualised 5G core?* of July, the industry is now more one year (37%), indicating a strong There are different factors holding confident in investing in what the enthusiasm and commitment from back the broad deployment of 5G on standardisation body calls “Phase 2” of the industry professionals to the We have already deployed higher frequencies, the most obvious virtualised 5G core..............................30% 5G, strongly characterised by industrial advanced phase of 5G. one being regulators not making use cases including next phase V2X, We will deploy it in the next the frequencies available for cellular 6 months...............................................16% Industrial IoT, URLLC enhancement. Despite the fast rollout of 5G networks technology. But other than that, there We will deploy it in the next These new features need to be in different parts of the world, are additional technology challenges 6-12 months.........................................21% underpinned by new network many 5G promises have not been the industry is facing with such We will deploy it in over architecture, the deployment of 5G delivered on yet. For example, in live 12 months.............................................32% deployment. The biggest technology radio networks on virtualised 5G core, commercial networks, we are nowhere challenge identified in the survey or the so-called “standalone mode”. close to the gigabit speed that has * Percentage is calculated among survey respondents whose business was inter-band and inter-technology is relevant to the questions been marketed. One way to close the management, chosen by 41% of those However, this does not mean the gap between the speed promised whose business is relevant to the industry had been waiting in inactivity on paper and what is experienced in question. Followed in a distant second for R16. Many trials as well as limited real life is to move up to higher radio place was interference management, but focused commercial SA mode frequencies. With notable exceptions at 23%, while a close third place (21%) 5G services had been launched even in Japan and the United States, 5G went to timing and synchronisation before R16 was frozen. It makes sense, networks in most other markets are management. therefore, for the survey to understand deployed on the sub-6GHz bands, the respondents’ plan to roll out the or what 3GPP calls Frequency Range Many of the key service propositions advanced phase 5G networks, in 1 (FR1). Even without the mmWave in the advanced phase of 5G rely particular the virtualised 5G core. bands being made available, on the virtualisation nature of the many operators can already make technology, for example end-to- Among the survey participants whose incremental progress by deploying 5G end network slicing. This requires 5G business is relevant to the topic, more in the 4-8GHz, or what IEEE calls the operators to adopt new monitoring than two-thirds have either already C-band. methods to ensure the service, Annual Industry Survey 2020 9 

10 . Figure 2-2:Do you have plans for Network Data Analytics Function (NWDAF) for 5G core? Yes, we are committed to NWDAF.............................................15% We are waiting for the standard to be finalized before committing....47% We don’t see any clear value in NWDAF..............................................26% Other .....................................................12% different from what they have used already committed to NWDAF; the In the past few years, the telecoms in monolithic networks. One answer rest were either waiting for finalised industry has seen a trend of telecom to such demand is Network Data standardisation or did not see the operators going cloud native. At one Analytics Function (NWDAF). The clear value of NWDAF. point, many tier 1 operators were objective of NWDAF is to provide building their own datacentres. The network level data analytics, for Another critical element to improve trend has taken a different turn example slice load level information. 5G (and 4G) performance is to recently, with some of the pioneers Figure 2-3:Do you plan to install Management & Orchestration (MANO) in the Going forward, the application of optimise transport inside the radio divesting their datacentres and public cloud? NWDAF will be expanded beyond part of the networks, in particular moving some functions to public facilitating network slicing and will the topology of fronthaul, which clouds instead. More and more become a central focus of data connects the Baseband Unit (BBU) telecom operators are adopting a Yes..........................................................22% analytics. and Remote Radio Head (RRH). There hybrid cloud strategy, that is retaining are different solutions to implement the key network functions on their No, but we may have some elements in the public cloud and the rest Despite that NWDAF was already the optimisation, the most popular private clouds while moving the will stay private....................................41% introduced at 3GPP’s 5G System of which, according to the survey non-network functions to the public No, we will always have this in our Architecture meeting in early participants whose business is clouds, as is done by Verizon and private network....................................38% 2017, and the specifications have relevant, were dark fibre and xWDM/ others. been published in Release 15 and WDM-PON, chosen by 26% and 25% 16, many in the industry were not respectively, though the biggest This new cloud strategy seemed yet convinced. Among the survey group, 33% of the total, were still to have resonated with the survey participants, only 15% said they were evaluating the options. respondents. Annual Industry Survey 2020 10 

11 . When asked if they would install in have become mainstream yet, but them, said they would subcontract Figure 2-4:How will you scale to meet the staffing demands of 5G acceleration? the public cloud Management & more vendors are promoting it, and the infrastructure buildout. This 100 Orchestration (MANO) function, a key more operators are adopting it. This was followed by the options to hire 90 element to manage network function is also reflected in the responses to additional engineering staff (37%), to virtualisation (NFV), nearly eight out of the question on DSS. The biggest subcontract testing (27%), and to hire 80 ten said no. Instead, they would either group, 36% of all the respondents additional field teams (25%). 70 have some elements in the public whose business is intimately related 60 Percentage cloud while keeping the rest private to 5G development, said they would In summary, over one year into its 50 (41%) or they would always have this consider supporting DSS but did commercial life, 5G momentum has 40 in their private network (38%). not have a definite timeframe yet. kept strong and the industry has Meanwhile 21% have already started started moving towards the advanced 30 Although 5G network rollout adopting DSS, and the rest were phase of 5G. However, to deliver on 20 globally has been fast since the first going to support it within the next the high promises of the technology, 10 commercial services went live, often one or two years. especially those value propositions to 0 the population coverage is limited. business customers, telecoms industry To accelerate the rollout, it would On a different front, companies stakeholders need to navigate Subcontract Hire additional engineering staff Subcontract testing Hire additional field teams Other infrastructure buildout be ideal if more spectrum resources engaged in 5G all face the same and overcome a broad range of could be made available to cellular challenge that engaging in any new challenges from spectrum shortage use. However, this is not always technology may entail: the scarcity of to embracing new monitoring and feasible. skilled staff. The survey participants’ analytics tools and many others in views are rather well distributed between that are expected to remain “THERE ARE DIFFERENT FACTORS HOLDING BACK THE One way to make more efficient use between an array of different in the near-term future. n BROAD DEPLOYMENT OF 5G ON HIGHER FREQUENCIES, THE of the radio frequencies at operators’ solutions to address the challenge. MOST OBVIOUS ONE BEING THE REGULATORS NOT MAKING disposal is to use dynamic spectrum In responding to this multiple-choice THE FREQUENCIES AVAILABLE FOR CELLULAR TECHNOLOGY.” sharing (DSS) technology. It may not question, the largest number, 48% of SPONSOR’S Critical to the successful delivery of 5G is the programmability that will allow the of cost of delivering the service must be achieved. This means that the operator must The concept of Network Function Virtualization (NFV) refers to the process dynamic environment which can respond in real-time to shifts in services. Enabling COMMENT FROM dynamic assignment of resources to the be able to deliver service at peak utilization of running network functions using cloud- the vast array of new 5G applications, for VIAVI SOLUTIONS corresponding tasks at any point in time and across the end-to-end network. However, with the desired QoS but as usage scales down to a much lower level, the correlating native software that is decoupled from the underlying hardware. The benefits of such example, can only be realized when operators evolve their networks to 5G SA (Stand Alone), to properly deliver both the incremental resources assigned should be scaled back a scheme are well documented in terms of a cloud-native 5G Core (5GC) based on NFV capabilities of 5G network programmability in order to align costs with the traffic levels. cost, flexibility, efficiency and time to deploy. built using IT network principles. compared to legacy networks – and to This is practically, perhaps only, achieved This evolution means moving away from enable relevant cost savings – a disconnect with the help of virtualizing the delivery proprietary hardware to a programmable of the peak and average utilization in terms platform. software-defined network delivering a Annual Industry Survey 2020 11 

12 .BROADBAND Demand for broadband access will continue KEY TAKEAWAYS to grow, driven both by the expansion of • Video-based applications will continue to drive demand digital lifestyle in general, and by the new for broadband mode of remote working. To meet the • Legacy copper footprint is seen as the leading constraint to the deployment of next-gen fixed access architecture growing demand and to generate positive • Reducing total cost of ownership of fibre access ROI, broadband operators need to overcome deserves the most executive attention multiple technical and non-technical • Value of broadband and 5G convergence is yet to convince the majority of survey participants challenges. CommScope (NASDAQ: COMM) is pushing the boundaries of technology to create the world’s most advanced wired and wireless networks. Our global team of employees, innovators and technologists empower customers to anticipate what’s next and invent what’s possible. Discover more at www.commscope.com Annual Industry Survey 2020 12 

13 .BROADBAND The broadband access market has been growing steadily, driven by both regulatory imperatives and operator expansion ambitions on the supply side and the increasing use of bandwidth-hungry applications on the demand side. Such demand probably has never services, or the pervasiveness of spot, with 23%, indicating that the been stronger than this year. With digital lifestyles in general. A growing survey participants believed the new COVID-19 forcing the majority of user base is demanding reliable, fast mode of working popularised during staff in many companies to work Internet connectivity to support an COVID-19 would be here to stay even remotely for months on end, there ever-broader range of applications, after the pandemic, and would have is huge pressure on IT and network on an increasing number of devices. strong implications to the broadband professionals to assure that all business. Related to this, in third place, corporate business and collaboration When it comes to the drivers for the was cloud-based business applications, applications run as they should to continued growth in demand for chosen by 10% of the respondents. meet employee and customer needs broadband, the survey participants and expectations. believed video-based applications Many of these applications, especially would continue to be the leading the video-heavy ones, like HD video This comes on top of the demand candidate, selected by 36% of those streaming, or multi-party video for broadband connections often responding to the survey. The “work conferencing, are bandwidth hungry associated with entertainment from home” trend took the second and would demand higher data speed to run smoothly. “Gigabit speed” has been marketed in more Figure 3-1:What are the key drivers for continued growth in broadband? than one context to attract customers to different types of broadband Video, OTT, streaming........................36% solutions. The majority of the industry Work from home trend.......................23% professionals that responded to the Business applications – survey seemed to believe that we move to cloud......................................10% would see gigabit speed broadly In Home networks, enabled by WiFi 6 - pushing higher available relatively soon. Over half expectations on mobile devices......... 9% of all respondents, 66% of them, 5G transport........................................... 7% believed that gigabit speed would IoT............................................................. 6% become the norm within three years, Gaming.................................................... 5% including 12% of them thinking this Applications we do not know of yet... 3% could happen within one year. A Other ....................................................... 1% further quarter of the respondents believed that gigabit speed would become common within five years. Annual Industry Survey 2020 13 

14 . doorsteps. In the real world however, Providing “universal” broadband When asked to assess the prospect of Figure 3-2:What is the biggest challenge to deploying a next-generation fixed access network architecture? (Choose all that apply) there are plenty of complications, access to bridge the digital divide is public funding to address the digital from access to incumbent telecom as much political as it is economic divide in the next five years, a quarter 100 operators’ ducts and poles to the and technological, therefore plenty of of the survey respondents said we 90 opening of “dark fibres” to virtual public financing has been pledged, would need more government broadband operators and many through either direct investment or funding. However, the biggest 80 other issues in between. One topic subsidies. One of the best-known group, 29% of all, believed what the 70 that no fixed access operator can examples of such tools is the Universal industry needed the most was more 60 Percentage avoid is legacy networks. Innovations Service Fund managed by the FCC, innovation efforts to lower cost. In 50 have been made to ride on the which has been used to support other words, we should spend the 40 legacy copper PSTN networks laid connectivity in rural and other money more efficiently. over the past century, including the under-connected areas in the US. 30 various iterations of DSL technology In the UK, the government believes This sentiment was also on display 20 and, more recently, G.fast. Other it needs £3 billion (US$3.75 billion) when the respondents were asked 10 technologies have sought to deliver “from whatever sources,” to help take to name the business priority related 0 fast Internet connection via cable broadband connectivity to the final to FTTx in their market that should networks, including generations 10% of the population that is currently get the most executive attention. Constraints due to legacy copper Lack of customer demand / ROI Lack of funding Regulations Lack of fiber in the core network Lack of access to skilled resources Other network footprint of hybrid fibre-coaxial (HFC) out of reach. European Union and its More than one-third (36%) of all technologies, especially in North member states have also invested respondents selected the total America. and pledged investment of different cost of ownership and the speed of sizes to cover the populations with deployment of fibre access networks. None of these technologies, however, broadband connections. This was followed in distant second compete well with optic fibre when it For the fixed access network to However, there are many different comes to broadband performance, Figure 3-3:Regarding the FTTx networks in your market, which of the following reach the desired state to deliver challenges for broadband operators reliability, and quality of service. deserves the most executive attention? on the big promises, including – but to deploying new architectures. Three Therefore, what will become of more than – high speed, the industry leading challenges were identified by the legacy networks is a topic for Total cost of ownership and speed of deployment of fiber needs to embrace next-generation the survey respondents, with legacy debate. Eight out of ten survey access networks..................................36% architecture. Plenty of discussion has copper network footprint as the participants thought these networks Meeting customer bandwidth been focused on what marketers leading constraint, chosen by 36% of would be decommissioned within demand.................................................21% call “smart Wi-Fi solutions.” But to all the respondents, closely followed the next decade, including 17% of Optimize broadband and video delivery........................................15% improve coverage, speed, and cost by the lack of customer demand them thinking the decommissioning How to effectively deploy efficiency, architectural optimisation and weak ROI (35%) and the lack of would take place within three years. crosshaul for my 5G network............11% needs to take place before the funding (34%). However, not everyone is convinced. Delivering a great wifi experience broadband connections reach the One-fifth of the respondents believed in the home...........................................10% Availability of skilled labor.................... 5% home environment. The most obvious In an ideal world, broadband the copper and hybrid fibre-coaxial Other........................................................ 2% example is choosing the best-fit split operators would connect all premises access networks would be here to topology for the market being serviced. with full fibre laid all the way to the stay for over 10 years. Annual Industry Survey 2020 14 

15 .and third places by the need to meet customer bandwidth demand transport, the so-called “x-haul” (the integrated fronthaul and backhaul). “PROVIDING Figure 3-4:Where do you see the convergence between broadband and 5G (21%) and the need to optimise video In a distant second place was “UNIVERSAL” playing the most prominent role? delivery (15%). bundled offers to customers, chosen BROADBAND There are multiple options to cope by 22% of the respondents, followed by 18% who saw the convergence as ACCESS TO BRIDGE Merge access networks into one to support wireline and 5G x-haul.........42% with the expected increasing a driver for further telecoms industry THE DIGITAL Only at level of bundled customer offerings..............................22% demand for fibre access. When M&A. DIVIDE IS AS MUCH Driving further M&A in telecom........18% comparing the available technology solutions, the most popular one, In summary, the survey responses POLITICAL AS IT IS Usage of PON for wireless transport x-haul....................................10% chosen by 32% of all survey confirmed the belief that demand ECONOMIC AND Usage of DOCSIS for wireless backhaul.................................................. 4% respondents, was simply to increase for broadband access is expected to TECHNOLOGICAL.” Other ....................................................... 4% fibre placement. In addition, continue to grow in the foreseeable addressing the growing demand future, driven both by the expansion with wavelength division multiplexing of digital lifestyle in general, and by (WDM) systems, both active (21%) the new mode of remote working. and passive (15%), were also viewed To meet such growing demand, as desirable solutions. broadband operators need to overcome multiple challenges, SPONSOR’S Nobody underestimated the role digital technologies played before COVID-19 – the industry needs the most innovative methods to reduce costs and over a third Broadband is more than optic including technological ones, COMMENT FROM but that role has intensified to enable the (36%) said total cost of ownership and fibre. In addition to the solutions like choosing the best network COMMSCOPE continuity of our normal lives, connecting people wherever they are. Fast and reliable speed of deployment of fiber access networks requires the most attention. developed on top of the copper architecture, and non-technological connectivity has never been more critical and cable networks, other modes ones, like public funding, and in the face of the seismic shift to remote The good news is that technology is working, constant online streaming, and improving, making it possible to improve of communications have also been those combined, like how to more frequent virtual events. the speed and total cost of fiber network explored. For example, satellite reduce the total cost of ownership. deployments. By arming network planners connections have also played a role, This is critical to not only deliver To cope with the significant increase in and field engineers with smart tools for traffic, network operators and governments network design, the industry can speed albeit a more limited one. More broadband benefits to customers, around the world have been working to up previously time-consuming decisions. recently, 5G-based fixed wireless but also generate positive ROI for the make connectivity services reliable and In addition, technologies like hardened access has been touted as a strong operators to make it a sustainable stable - by investing to expand the capacity connectivity with pre-connectorised plug- of existing network infrastructures and and-play approaches, where the main work supplement to fibre to deliver and viable business. n support new fiber rollouts. has already been completed in the factory, broadband access. However, when lead to a much more rapid rollout in the field the industry professionals were asked However, higher bandwidth demands and a more reliable fiber network with a smarter planning and deployment. As is much longer lifespan. to evaluate the role of convergence the case for the entire global economy, the between broadband and 5G, the COVID-19 crisis has put additional pressure When designing today’s networks, we have largest group, 42% of the total, on service providers, forcing them to reduce to ensure that they are scalable, reliable, operational costs and maximise their return and will be able to meet future application believed that the converged access on investment. This may be the reason why and service requirements for decades to would be most viable as a driver three in 10 (29%) respondents claimed that come. for the convergence of network Annual Industry Survey 2020 15 

16 .DIGITAL TRANSFORMATION Determination and enthusiasm to pursue KEY TAKEAWAYS digital transformation has not diminished • Three-quarters of participants see their investment in despite the negative impact of COVID-19. digital transformation either maintain or increase despite COVID-19 New service offerings with QoS guarantee, • Half of respondents believe data is already commoditised powered by new network capabilities • An operator would not need more than 50 partners of all including those of advanced 5G, are believed kinds combined to be able to generate new business • Many are not convinced of the benefit of automating customer care opportunities. Openet, an Amdocs company, is a leading software and services provider to communications companies. Our deep domain expertise & understanding of complex systems, underpinned by the tenacity and determination of our people, enable us to radically transform how our customers do business, providing best in class digital and 5G business support systems. In an industry where the only constant is change, our open and innovative technology is built for change. For the last 20 years we have helped the world’s most innovative communications companies manage and monetise their business and evolve from communications companies to digital service providers. This gives our customers the power to enter new markets, open new revenue streams and increase profitability. To find out more, visit www.openet.com Annual Industry Survey 2020 16 

17 .DIGITAL TRANSFORMATION Not too long ago, almost every telecoms company was talking about digital transformation, vowing to grow from a connectivity provider to a digital service platform. If the mixed degree of success has raised one or two questions, 2020 seems to have put the CEOs’ resolve to press ahead with their digital transformation journey to a sterner test. Push for such transformation has gained a stronger impetus in a time when digital life and digital work has never been more desired and more permeating. Meanwhile investment in digital showing that their enthusiasm and Naturally the rollout of 5G in different Figure 4-1:Has COVID-19 impacted your company’s investment in transformation must vie for priority determination to transform did Digital Transformation? parts of the world has fuelled the on the CEOs’ agendas with other not badly diminish in the time of enthusiasm to offer more value- demands, especially in companies pandemic. adding digital services using the whose businesses have been latest mobile technology, especially negatively affected by COVID-19. with 5G’s better quality of service (QoS) guarantee. This will enable 5G We have reduced investment...........24% Therefore, it was encouraging to read Successful digitalisation relies on operators to offer new experience No change.............................................54% that over half (54%) of the survey data of good quality, quantity, and with QoS promise to both consumers We have made more investment.....22% participants said COVID-19 had not availability. However, whether data and business customers, though the impacted their companies’ investment in its own right will remain valuable propositions will be different from one in Digital Transformation, while 22% is debatable. Therefore, before we group to another. said their investment had actually explored how digital services could increased. That leaves a quarter create new values, it made sense to For consumers, the offerings will (24%) of the respondents admitting first ask the survey respondents to largely concentrate in the home that their companies’ investment had think about the value of data itself. and entertainment domains. More been reduced. This feedback stood The dominant view seems to be that than 80% of the respondents were in favourable comparison with the data itself will be commoditised, if it confident that, in the next one to responses to the earlier question in has not been commoditised already. two years, consumers would start the Industry Landscape section on Half of the respondents (51%) believed embracing 5G-based, QoS-promised COVID-19’s impact on their business that data has already become a services and would help grow in general, when 44% said they had commodity, and over a third (37%) revenues. Among the types of services, been negatively impacted. It is clear thought it eventually would be home working package was ranked that many companies did not cut commoditised. However, 13% of those the highest, chosen by 51% of the back on their digital transformation who answered the survey continued respondents, probably inadvertently budget straightaway when the to believe that data on its own would indicating that participants in the overall business underperformed, still carry premium in the long run. survey believed working from home, Annual Industry Survey 2020 17 

18 . as has become common this year, Most survey respondents, 56% of the gaming or video streaming services, Figure 4-2: D  o you think that data on its own will become a commodity? If so, how long before this happens? would have a long-lasting bearing total, believed that customers would to use 5G as a go-to-market channel on future mode of working. This pay a premium for this type of special for their services: 61% said yes, 11% said was followed by gaming (46%), service with a guaranteed QoS. Only no. fixed wireless access-based home 17% was sceptical. It’s already here....................................51% broadband (38%), and smart home Needless to say, 5G operators need 1 year....................................................... 7% (31%). Comparable level of confidence partners across the ecosystem for 2 years...................................................11% was also on display when survey the drive to empower digital services 3 years...................................................10% Despite the high degree of confidence participants were asked if they to succeed. In other words, the 4 + years.................................................. 8% in consumers’ willingness to embrace thought wholesale service level business growth through driving and No, data on its own will not become a commodity........................13% QoS-promised new services, their agreement (SLA) for QoS would drive enabling new digital services would contribution in monetary terms was more service companies, for example come at additional operational costs going to be modest, according to the survey participants: Only 11% of Figure 4-3: Do you think in the next 12-24 months you will see an uplift in all respondents, the smallest group, revenue by offering QoS to consumers for any of the following services believed that more than 10% revenue delivered by 5G? (Choose all that apply) incremental could be achieved by 100 offering QoS to consumers, while 58% thought the uplift would be less than 90 5%. 80 70 On the other hand, 5G-powered 60 Percentage QoS promises to business customers will come in different shapes. For 50 example, with the advanced phase of 40 5G being rolled out, in the so-called 30 standalone mode, 5G operators 20 will be able to deliver end-to-end 10 network slicing with QoS guaranteed parameters, such as speed, latency 0 Home working package Gaming FWA – home broadband AR / VR Smart homes TV revenue by offering QoS to No, I don’t see an uplift in consumers in the next 2 years level, capacity, and availability. In turn, such slices can be offered to enterprises to provide QoS-level home office connection that guarantees business and security applications can run as they should, for instance. Annual Industry Survey 2020 18 

19 . operation processes, which should including those of advanced 5G, Figure 4-4: D  o you think being able to offer wholesale service level also include the customer touchpoints. would be able to generate new SPONSOR’S COMMENT agreement for QoS will drive more Automating customer service, for business opportunities. Meanwhile FROM OPENET service companies (e.g., gaming example by encouraging customers they also demonstrated a realistic companies like Nintendo) to use It seems to be official. Data is a commodity. news is that service providers can monetise to use self-care on operators’ view on both the level of expected 5G as channel to market for their Over half the respondents to this survey this experience: 56% of the survey felt that services? applications, would increase contribution to business and the said that data is already a commodity. mobile customers would pay a premium operational efficiency. Not all in the complexity of managing extensive With 3G and 4G the network was a means for a guaranteed 5G quality of service for industry are convinced it is the right partnership networks. n of connectivity. Some OTT companies a range of services such as home working did very well selling digital services over bundles, entertainment packages, smart route, or the time is right yet, however. the service providers’ networks and drove home services and gaming. This could be down to the inadequate a lot of mobile traffic and growth. But at accuracy of the AI tools behind the the same time the move towards data However, service providers will need to commoditisation was getting closer with look at their BSS and OSS stacks. In 5G app, or the concern that the lack of more GB for less money becoming the there’s the need for 5G policy and charging human touch could result in higher service providers’ main selling point. functions to be tightly integrated to service churn, or some other reservations. Service providers were getting squeezed. catalogs in BSS and also to the 5G network. This enables the creation of a Value Plane 5G offers an opportunity for service that bridges IT & business in a service All these factors combined might have providers to turn the corner and start provider and the 5G network. This is been behind the 30% respondents’ growing their businesses. With 5G the needed because the characteristics of the network is doing more than just providing 5G network are a central part of network- (the biggest group) choice to not connectivity. The experience that the 5G enabled 5G services and offers and they Yes..........................................................61% actively drive customers to self-care network provides is an intrinsic part of 5G need to be easily managed, controlled and No...........................................................11% on their app, when the survey asked offer – such as gaming with no buffering, monetised. This will provide a platform for or home working with no dropped zoom business growth. Not sure.................................................28% the industry professionals to assess calls, or advanced enterprise use cases the impact of such efforts. The second such as robotic manufacturing. The good Martin Morgan, VP Marketing biggest group, at 27%, said that from managing partners. How high driving customers to self-care had the costs could go depends on the helped improve their operational individual operator’s capacity and efficiency. the tools at their disposal. Instead of “the more the merrier,” the general In summary, telecoms businesses’ consensus of the survey respondents, enthusiasm and determination to “NATURALLY THE ROLLOUT OF 5G IN DIFFERENT according to the views of 68% of pursue digital transformation has PARTS OF THE WORLD HAS FUELLED THE them, was that an operator would not diminished despite the negative not need more than 50 partners of all impact of COVID-19 on the business ENTHUSIASM TO OFFER MORE VALUE-ADDING kinds combined, while 29% thought of some of them. The industry DIGITAL SERVICES USING THE LATEST this number should not go beyond 10. professionals participating in the MOBILE TECHNOLOGY, ESPECIALLY WITH survey were confident that new Successful digital transformation service offerings with QoS guarantee, 5G’S BETTER QUALITY OF SERVICE covers all network and business powered by new network capabilities (QOS) GUARANTEE.” Annual Industry Survey 2020 19 

20 .INTELLIGENCE AT THE EDGE Though telecom operators are believed to be the best suited host of edge computing, KEY TAKEAWAYS they are facing stiff competition from • Half of all respondents believe edge computing should take place at telecom operator network edge hyperscalers. Industries and enterprises • Concern for financial cost is the biggest barrier to stop aiming to benefit from the edge should wide-scale enterprise adoption of edge computing • 8 out of 10 are likely to rearchitect their business recognise that tangible business returns processes to leverage edge intelligence will justify the cost invested to embrace • Participants show strong interest in digital twins edge technology and the changes needed to leverage edge intelligence. VoltDB empowers global organizations to leverage emerging 5G latency standards to power new revenue opportunities, transform their business and operational support systems, or develop strategic integrations for their enterprise customers. The platform instantly derives value from anomalous events captured across multiple streams of fast data, directly influencing in-the-moment monetization, preventing digital fraud, and supporting digital transformation initiatives. VoltDB is purpose-built to address application-specific scale and latency challenges and augment previous big data and messaging investments to enable businesses to evolve from big data analytics to fast data decisions. For more information, please visit voltdb.com Annual Industry Survey 2020 20 

21 .INTELLIGENCE AT THE EDGE Edge computing, be it on mobile or fixed networks, is a topic that telecoms professionals have enthused over for many years, and expectations for its being embraced by different industries have been high. However, in different contexts, what may constitute as “edge” can be quite different. For example, on a cellular network, of participants (22%) viewed edge as Figure 5-1: W  hat, in your opinion, defines edge the closest? the edge could be the base stations, referring to the extreme edge and which are closest to the customers therefore selected chips within devices 100 to deliver low latency. But if looked as their preferred definition. 90 at from the perspective of the overall 80 mobile communications system, the When it comes to selecting where 70 edge would be the mobile devices edge computing should take place 60 Percentage where lots of computing takes place, to achieve the highest impact on whereas in the enterprise context, the digital transformation, telecom 50 edge could refer to the IoT device, or operator network edge was the clear 40 a gateway located at the customer winner with 48% of the responses. 30 premises. This probably owes as much to the fact that telecom operators 20 Therefore, to set the scene, before own most of the communication 10 we delved into the opportunities and networks as to the telecoms industry 0 challenges edge computing faces and respondents’ professional loyalty Data processing Industrial Routers/ Chips within the values that can be created with (or bias). Other than the telecom commodity servers Gateways receiving devices collecting data from data from multiple intelligence at the edge, we asked the operators, competition between the gateways devices survey participants to choose what in other options was close. Public edge their views defines edge. The results cloud came in a distant second place were rather evenly distributed between at 18%, followed by on-premises (12%), those who chose data processing private cloud (11%), and public cloud commodity servers collecting data providers (10%). from gateways (40%) and those that went for industrial routers or This is a true reflection of the debate “EDGE COMPUTING’S POTENTIAL TO BENEFIT MANY SECTORS gateways receiving data from multiple on who should own the edge in the IS CLEARLY THERE, BUT AFTER YEARS OF PUSHING FROM devices (38%). A significant minority real world. VENDORS AND OPERATORS, LARGE-SCALE IMPLEMENTATION BY ENTERPRISES HAS PROVED ELUSIVE.” Annual Industry Survey 2020 21 

22 . Figure 5-2: Where should edge computing be for highest impact in a digital transformation? Telecom operators are increasingly telecoms came out as a clear operators as systems integrators to get facing competition from the winner, according to 58% of all the their private networks up and running. hyperscale public cloud providers respondents. This is presumably down For those enterprises that cannot who are aggressively bringing to the benefit that telecoms, as many afford their own spectrum, network Telecom operator network edge......48% webscale functions to the edge, other industries, could gain directly edge with the cloud prowess could On-premises.........................................12% leading examples including AWS from edge computing, such as higher Private cloud.........................................11% prove to be useful. Wavelength, Azure Edge Zones, and data accuracy and lower latency level Public cloud providers........................10% Google Anthos. On the other hand, among other benefits. Meanwhile Public edge cloud (think AWS In distant second to fourth positions such competition has enterprises telecoms should be able to uncover Wavelength or Azure Edge Zones)..... 19% on the top barrier list were the concern standing to benefit from best of the additional value by providing edge over security at the edge (44%), both worlds, as partnerships have computing service to other industries, corporate inertia resisting change been set up between operators and as telecoms operators own most (43%), and the lack of clear business the cloud vendors such as Verizon and of the communications networks. benefit (40%). These results are telling AWS Wavelength, AT&T and Azure Other leading benefactors of edge edge computing advocates that, Edge Zones, and in India, AWS has computing were perceived to include going forward, the communication Figure 5-3: W  hat are the top barriers to entry preventing a wide-scale enterprise partnered with Bharti Airtel to deliver manufacturing and gaming, both at adoption of edge computing? (Choose all that apply) messages, in addition to talking about cloud and edge computing solutions 40%, and cybersecurity, at 38%. the technological advancement, should to the telecoms operator’s enterprise 100 also focus on tangible ROIs, and on customers. Also, a recent trend has Edge computing’s potential to 90 positioning edge computing adoption seen hyperscalers buying stake in benefit many sectors is clearly there, 80 as an integral part of enterprises’ overall telecom operators, for example but after years of pushing from digital transformation process. 70 Facebook and Google have made vendors and operators, large-scale 60 Percentage huge investments in Reliance Jio. implementation by enterprises has In addition to the technological proved elusive. There may be multiple 50 parameter improvement, such as Telecom operators have also seen factors behind the slow, hesitant take- 40 low-latency level and more efficient competition coming from private up, and it is apparent in the responses deployment of compute power, edge 30 networks, with telecom operators to the question on the top barriers computing can also generate more 20 bypassed in many cases, hence the to entry preventing broad enterprise accurate, timely, and comprehensive demand for edge computing to take adoption of edge computing. 10 intelligence than otherwise developed place on premises. These private 0 from the centre, thanks to the data enterprises to adopt edge over edge computing Resistance to change what works now Financial cost for benefit in adopting edge computing Edge computing needs 5G to really take off Development of edge Other No clear business computing is not a high enough priority computing solutions Security concerns networks could be operated by utility Coming up on top, chosen by over processed on the network edge. operators, public sector organisations, half of all respondents (57%) was the Such data and intelligence will not or enterprises. worry about financial cost. This is only benefit the edge but the whole understandable and expected. Not all system. However, like the multiple This leads us to examine which companies have the scale or financial understandings of edge computing industries could reap the most benefit capacity like Daimler and Lufthansa, itself, intelligence at the edge can from adopting edge computing. which have invested in getting their also mean different things to different In this multiple-choice question, own spectrum and using network parties. Annual Industry Survey 2020 22 

23 . Figure 5-4: W  hich definition is closest in describing your perception of intelligence at the edge? Digital twins are a new application “IF LOOKED AT FROM THE PERSPECTIVE OF of intelligence at the edge, but the interest in them is on the rise. Though THE OVERALL MOBILE COMMUNICATIONS only a minority of respondents SYSTEM, THE EDGE WOULD BE THE MOBILE said they have already used DEVICES WHERE LOTS OF COMPUTING Intelligent tiering of data digital twins for different purposes, between local use and cloud.............40% including predicting and prescribing TAKES PLACE.” Data aggregation on devices............25% preventative actions (11%), creating real-time sense and control loops Process automation by low-latency decisions.........................36% (8%), or preserving the asset state history (7%), a large number of survey participants (43%) expressed interest in learning more. Meanwhile, a significant number of participants in the survey (35%) agreed that creating When asked to choose the definition highly likely (25%) or somewhat likely digital twins of physical assets is a closest in describing their own (57%) for them to rearchitect their critical step to truly benefit from edge perception of intelligence at the business processes to leverage edge intelligence, though, admittedly, more edge, 40% of all survey respondents intelligence. than half (53%) were still unsure. SPONSOR’S COMMENT selected intelligent tiering of data FROM VOLTDB between local use and cloud, closely One recent product of edge In summary, the advantages of edge followed by those going for process intelligence is the development computing and the benefits of edge 5G is heralding an impetus in enterprises is going to be and how disruptive this automation by low-latency decisions of “digital twins.” These are digital intelligence were well recognised evaluating their own business processes to transformation will be to the status quo understand if and how they can benefit from business. (36%). A minority of respondents representations of the physical by the survey participants, despite 5G. This digital transformation is bringing believed intelligence at the edge world, developed with data of high a few barriers still holding back to the forefront how one can enrich the Do they just use the edge to determine should refer to data aggregation precision captured on the network enterprises from broadly adopting digital representation of assets, be it people what data is stored locally and how the or process or a physical asset. It is now data is aggregated to minimize the data on devices (22%). It probably should edge fused with data from other edge computing. It is worth noting time to go beyond simple storage of asset transferred to their central data center/ not come as a surprise that there is sources. Network operators will also that telecom operators, who are information for analytics to operationalizing cloud data center? Or, will the data power high degree of overlap between this be able to generate interconnected believed to be the best suited host intelligent decision making thus turning business processes that incorporate the digital twins to become the brains both process automation and security minority group and the respondents and collaborative digital twins, of edge computing, are facing behind the physical twins. But this means intrinsically into every step? Or will the cost who chose “chips within devices” as and digital representation of larger stiff competition from hyperscale bringing the intelligence, decisions and of implementation prohibit even the most the closest definition of edge. (See objects and their environment. For companies including Microsoft, actions closest to the sources, i.e., what mature organizations from embarking on is purported as edge. What constitutes an this journey and push them into a utopian above.) example, a digital twin of a particular Amazon, and Google. It is critical edge for an enterprise depends on: world of wishful thinking? location could be used by network that industries and enterprises that It is encouraging to see that many planners to model accurate signal could benefit from the edge should • the business that the said enterprise is in VoltDB has built a unified data platform • how the data is being used that brings together capabilities that can companies, recognising the benefits propagation prediction without be convinced that tangible business • how quickly decisions need to be made enable an enterprise to handle the entire of intelligence at the edge, are having to dispatch testing and returns could justify the cost invested • how quickly actions need to be taken spectrum of activities required to make this willing to change so as to reap these measuring teams to the field multiple to embrace edge technology and the transformation reality, from ingestion of Quite often, the maturity of the enterprise data to measurement of KPI to decisions benefits. Among all the respondents, times, to improve both operational changes needed to leverage edge also dictates how deep their transformation leading to corrective/monetization actions. more than eight out of ten said it was efficiency and staff safety. intelligence. n Annual Industry Survey 2020 23 

24 .SECURITY KEY TAKEAWAYS When telecoms businesses are becoming • DNS services enduring most attacks over the last 12 more like IT companies, their security months • Cloud applications and infrastructure “most difficult to strategies should broaden from defending defend” the network infrastructure to the whole • Cloud migration: 27% using security services offered by the public cloud provider system, covering both on-premises assets • Network layer security is a top priority and those in the cloud. F5 (NASDAQ: FFIV) is a multi-cloud application security and delivery company that enables our customers – which include the world’s largest enterprises, financial institutions, service providers and governments – to bring extraordinary digital experiences to life. For more information, go to f5.com. You can also follow @f5networks on Twitter or visit us on LinkedIn and Facebook for more information about F5, its partners and technologies. Annual Industry Survey 2020 24 

25 .SECURITY While communications networks evolve, so do security concerns. With software taking a more central role in running telecoms networks, and more and more operation processes and applications moving to a cloud environment, private or public, telecoms operators are becoming more like IT companies. This means they should also expect security challenges to come in more diverse shapes and on different targets than just attacks on the network infrastructure. This section of the survey therefore set defend their DNS security. Responding out to understand from the industry to this multiple-choice question, 47% Figure 6-1: Which areas of your network are the most difficult to professionals the security challenges of the survey participants said they protect against attacks? the telecoms industry players were securing against volumetric DNS are facing, how they have been DDoS attacks. DDoS attacks may defending their assets, and what the have been an old trick, but that does future holds for them. not make them less popular. Looking at the immediate past, when Recent network data released by the survey respondents were asked to Nokia showed that DDoS traffic went identify which parts of their network up by up to 50% during COVID-19, have been attacked the most over increasing faster than almost any the last 12 months, the largest group, other network application. They 16% of all, have seen their DNS could come from unusual corners. For services enduring most attacks. This is example, one key contributor to the closely followed by attacks on network spike in recent attacks was malicious infrastructure elements (15%), such online gamers paying for short spurts Cloud-based applications/ infrastructure........................................24% as network bandwidth and network of DDoS attacks to take down their Network Infrastructure elements protocols, and attacks on on-premises opponents. (Clearly some people do (e.g. network bandwidth, network applications and infrastructure (11%). “THE REASONS THAT THE TELECOMS INDUSTRY HAS FOUND go the extra mile to get their way.) protocols, etc.).....................................21% On-premises applications/ CLOUD INFRASTRUCTURE AND CLOUD APPLICATIONS infrastructure........................................18% As a matter of fact, attacks on DNS The second most broadly engaged PARTICULARLY HARD TO DEFEND MIGHT COME DOWN TO DNS Services........................................12% services are so common that the defensive measure among the survey BOTH THE FACT THAT CLOUDIFICATION IS NEW FOR MOST Signaling & Protocol survey asked a separate question on participants was securing against (e.g. Diameter, HTTP/S, SS7, SIP)....... 11% what initiative the survey respondents’ TELECOMS COMPANIES, AND THE AGGRESSIVE APPROACH Advanced DNS attacks, such as DNS Other (please specify).........................10% companies are currently working on to TO CLOUD MIGRATION ADOPTED BY SOME COMPANIES.” random subdomain attacks. This was OSS/BSS systems................................. 4% Annual Industry Survey 2020 25 

26 .selected by 39% of the respondents, Figure 6-2: When migrating applications to public cloud, what is your security followed by securing against DNS strategy? Protocol attack, such as malformed DNS packets, at 38%, and against Lifting and shifting of your DNS protocol abuse, such as DNS on-premises security solution tunnelling, at 34%. to the Public Cloud..............................18% Using security services offered Despite DNS services having been the by the public cloud provider..............27% most attacked network component, Using cloud-based security services they are not the parts that are the from another third party (managed security services provider).................25% most difficult to defend, according to the survey participants. That “honour” None of the above as I have no went to cloud-based applications and plans to migrate applications to the public cloud...............................29% cloud infrastructure, selected by 24% of all survey participants. It was followed by network infrastructure elements (21%) and on-premises applications companies could just replicate every that 29% of the respondents said and infrastructure (18%). DNS services system and application from on- their businesses were not planning to came at a distant fourth place, chosen premise to the cloud, then it would be migrate any applications to the public by 12% of the respondents, indicating a concern well worth expressing. cloud environment. that either the defensive measures for DNS services were relatively So is the case with cloud security. On the other hand, many of the mature or perhaps respondents had Defensive measures used for on- companies represented by the survey underestimated the challenge. premise systems should be re- respondents also offer their security architected, and in some cases solutions to their own enterprise The reasons that the telecoms revamped completely, to protect customers. The popular services industry has found cloud infrastructure cloud applications, especially when included anti-malware solutions and and cloud applications particularly it comes to migration to public Layer 2-4 DDoS attack protection, hard to defend might come down clouds. The largest number of survey selected by 39% of the respondents to both the fact that cloudification respondents, 27% of them, said each. Almost as popular on offer were is new for most telecoms companies, their companies were using security IP and domain allow/block-listing, and the aggressive approach services offered by the public cloud to cloud migration adopted by provider when they migrated. A some companies. If the industry quarter of them were using third- “WHAT ARE MOST ATTACKED AND WHAT ARE professionals’ concern could serve the party cloud-based security services; HARDEST TO DEFEND ARE NOT ALWAYS THE purpose to reinforce the message that in other words, they used managed migration to cloud does not mean security services. It is also worth noting SAME. THIS MEANS SMARTER DECISIONS WOULD BE NEEDED ON HOW TO SPEND THEIR SECURITY BUDGET. ” Annual Industry Survey 2020 26 

27 .next-generation firewall, and secure ranking (21%) and in top-three places Figure 6-4: W  hat is your company’s Figure 6-3: Please rank your company’s security focus for 2021, with No. 1 being remote access, all at 37%, and DNS (69%) was security to protect user spending plan for security in 2021? the highest. protection, including protocol and control and access, closely followed allow/block-listing (36%). by application security, with 18% No. 1 positions and 68% of top-three Network layer Some applications are both critical rankings. and vulnerable and would need special, application-level protection. When it comes to budget plans for User control & access Over half (51%) of all the respondents security in 2021, it was encouraging to identified subscriber portals as the hear that three-quarters of the survey first priority that needs such a special participants said their company would security measure. This has become either maintain their spending level or Application increasingly important in recent years increase their budget, including 23% for service providers and any business saying their budget would increase that hosts subscriber data, not only significantly while 28% said their Spending will increase significantly Cloud & NFV Infrastructure because it is critical for their business, spending would go up more modestly. (10% or more).......................................23% but also because they have come Spending will increase modestly under closer regulatory scrutiny over In summary, as digital transformation (less than 10%)....................................28% user data protection, failures of which deepens, telecoms businesses, in Spending will remain the same........25% API security could mean heavy penalties as well particular telecoms operators, are Spending will decrease slightly (less than 10%)...................................... 2% as mounting customer churn. becoming more like IT companies, Spending will decrease significantly therefore their security strategies (over 10%)............................................... 3% 0% 20% 40% 60% 80% 100% Following subscriber portals, OSS/BSS should broaden from defending the I’m not sure...........................................19% No. 1 No. 2 No. 3 No. 4 No. 5 systems were identified by more than network infrastructure to the whole a quarter of respondents (26%) as system, covering both on-premises requiring application-level protection. assets and those in the cloud. Meanwhile many respondents commented that security of fintech What are most attacked and what are apps, such as online banking, online hardest to defend are not always the “MANY SPONSOR’S COMMENT payment or money transfer apps, same. This means smarter decisions RESPONDENTS FROM F5 should also be strengthened. would be needed on how to spend their security budget. There could also COMMENTED THAT Many companies are (over)relying on public especially in multi-cloud environments. Looking ahead, the survey asked be an opportunity for professional SECURITY OF FINTECH cloud service providers for their security, This is particularly important for telcos, participants to rank their companies’ security solution providers to either APPS, SUCH AS from DNS to cloud-based applications. Despite being easy to implement, those which are already under the spotlight during the pandemic and managing an increased top security focus areas in 2021. Getting help automate or provided outsource the most “first priority” ranking (33%) solutions for those tasks that are ONLINE BANKING, services are typically not sophisticated and volume of threats. lack features that can help with security was security for the network layer. It frequent but easy to manage. This ONLINE PAYMENT OR management and compliance. There is also an opportunity for telcos to offer more robust managed security was also the area that gathered the would enable telecoms businesses to MONEY TRANSFER We encourage all companies to consider services to their customers and use it as a most top-three mentions, with 71% of free up time and resources to focus on respondents putting it in their top- the most important tasks of their core APPS, SHOULD ALSO more robust security solutions for their critical applications and infrastructure, tool to differentiate themselves. three list. In second place, both in No. 1 business. n BE STRENGTHENED.” Annual Industry Survey 2020 27 

28 .Appendix – Survey Results INDUSTRY LANDSCAPE Q1: How would you describe the telecom industry’s overall business performance so far in 2020? Q6: Which of the following are likely to be priority investment areas for your company in 2021? (choose Excellent 13% all that apply) Good 54% 5G 64% Average 24% Cloud 42% Below average 7% Digital Transformation 42% Poor 2% Security 36% IoT 35% Virtualisation 34% Artificial Intelligence including Machine Learning 34% Q2: How would you rate your company’s business performance in 2020 compared with the telecom Broadband 27% industry as a whole? 4G/LTE 26% We are outperforming the industry by a significant margin 12% Edge Computing 21% We are outperforming the industry by a small margin 32% BSS/OSS 17% We are performing at the same level as the rest of the industry 41% Content (e.g. video, gaming) 14% We are underperforming the industry by a small margin 11% MVNOs 9% We are underperforming the industry by a significant margin 4% 6G 7% Other 6% Q7: Which of the following is the greatest potential threat to your company’s long-term business success? Q3: How has COVID-19 impacted your company? Failure to roll out new technologies fast enough 24% We have been negatively impacted by COVID-19 44% Increased pressure to lower prices and profit margins 22% COVID-19 has no or negligible impact on us 36% Competition from Webscale companies (e.g. Google, Amazon, Microsoft) 8% We have done better during COVID-19 than we would normally do 15% Lack of demand from business customers 8% Other 5% Regulatory restraints 8% Inability to adopt agile service model 7% Failure to address network complexity issues 6% Q4: How do you feel about the telecom industry’s business outlook for 2021? Inability to lower operating expenses 6% Very positive 31% Lack of contingency plans for disruptions (e.g. a pandemic) 4% Somewhat positive 46% Lack of demand from consumers 4% Neutral 15% Other 4% Somewhat negative 6% Poor 1% Q8: What are the most overhyped emerging technologies today? (Choose all that apply) Very negative 0% Artificial intelligence including Machine learning 41% 5G 39% Autonomous vehicles 38% Quantum computing 28% Q5: Which of the following are likely to be the telecoms industry’s priority investment areas in the next 3 years? (choose all that apply) Mixed reality / Virtual reality / Augmented reality 27% Initial 5G deployment 68% Consumer IoT 26% Fiber (FTTx) deployment projects 51% Big data / analytics 20% Virtualization 46% RAN innovations including Open RAN 19% 5G densification 40% Edge computing 16% Next generation access technologies 38% Industrial IoT / Industry 4.0 16% Standalone mode 5G deployment 33% Virtualisation (NFV and SDN) 15% Other 7% Full-fibre / Passive Optical Networking 15% Cloud native and cloud computing 13% Automation 13% Other 2% Annual Industry Survey 2020 28 

29 .Appendix – Survey Results 5G Q9: When do you plan to deploy a Virtualized 5G Core? Q13: What kind of fiber fronthaul topology are you considering ? We have already deployed virtualized 5G core 15% Time Sensitive Networks 6% We will deploy it in the next 6 months 8% Dark Fiber 14% We will deploy it in the next 6-12 months 10% xWDM/WDM-PON 13% We will deploy it in over 12 months 16% OTN 3% We do not have a plan yet / It's not in the scope of our current business 52% We're still evaluating the options 18% I don't know / It's not in the scope of our current business 45% Q10: Do you plan to roll out or to support dynamic spectrum sharing (DSS) for 5G acceleration? Yes, we have already started DSS 10% Q14: Do you plan to install Management & Orchestration (MANO) in the Public Cloud? Yes, in 6-12 months 12% Yes 22% Yes, in 12-24 months 9% No, but we may have some elements in the public cloud and the rest will stay private 41% Yes, but we haven’t fixed a timeframe yet 18% No, we will always have this in our private network 38% We don't have the plan to roll out or to support DSS 51% Q15: Do you have plans for Network Data Analytics Function (NWDAF) for 5G Core? Q11: When will you start to scale up 5G deployments in the C-band (4GHz-8GHz)? Yes, we are committed to NWDAF 15% It is already ongoing 11% We are waiting for the standard to be finalized before committing 47% Within 12 months 12% We don’t see any clear value in NWDAF 26% Within 1 to 2 years 11% Other 12% Within 2 to 4 years 9% I don’t know / We don't such a plan / It's not in the scope of our current business 57% Q16: How will you scale to meet the staffing demands of 5G acceleration? (Choose all that apply) Subcontract infrastructure buildout 48% Q12: What are the key challenges in deploying 5G in C-band (4GHz-8GHz) Hire additional engineering staff 37% Interference management 12% Subcontract testing 27% Inter-band and inter-technology management 22% Hire additional field teams 25% Timing and Synchronization management 11% Other 14% I'm not sure 47% Other 8% Annual Industry Survey 2020 29