Deloitte analyses top trends for telecommunications industry

Mobile search will dominate the strategic direction of the smartphone market in the year ahead, with search becoming one of the five most-used smartphone applications by year-end 2010, according to Deloitte's predictions for the telecommunications sector this year.

Mobile voice calls made via an IP-based network (VoIP) are anticipated to evolve from niche to mainstream, given the availability of new services that blend an increasing range of IP-based features that complement mobile voice, including: one-to-many calls, broadcast voicemail, and voice-to-text. As a result, mobile VoIP services are expected to reach tens of millions users by the end of 2010.

Jolyon Barker, global lead for Deloitte's Technology, Media and Telecommunications Industry, said: "Telecommunications predictions for 2010 have been largely shaped by the consequences of digitisation and mobile data. The growing importance of mobile search is expect to generate fierce competition among search providers; however, only one or two players may dominate this space in the mid-term."

Leadership in mobile search will dominate the smartphone market in 2010, despite modest projected revenues at between US$1 to $2 billion. However, providers will spend several times that amount to strategically position their companies to exploit future income streams. By year-end 2010, search will become one of the five most-used smartphone applications.

2010 could be an inflection year for VoIP - voice call over the top of an IP-based network - via mobile phone, given the growing number of WiFi-enabled phones, more WiFi hotspots, and the increase of 'one-to-many' communication. Within three years, mobile VoIP could be worth over US$30 billion globally. If routed over WiFi, mobile VoIP could lessen demands on the cellular network, and smaller operators in markets where the calling party pays could see a decrease in overall termination charges. Companies may use the allure of free calls to enable the flow of advertising messages, therefore substantiating the mobile voice market's value.

If mobile VoIP results in declining revenues for operators, investment available for maintaining networks could drop and threaten the roll-out of next generation infrastructure. Portals, such as Yahoo or Facebook, could promote mobile VoIP applications by pointing to smartphone versions of their websites.

With nearly 600 million mobile broadband connections, 2010 could see the wireless equivalent of gridlock. Telecommunication technologies that can make existing wireless networks perform better should experience stronger growth than overall IT spending. Leading pure-play companies in this area should see year-on-year growth approaching 100 per cent, with the average company expected to grow by 30 to 40 per cent.

2010 will see enterprises less likely to default to 99.999 per cent - or "five nines" - reliability for contracted services, and, instead, determining quality levels on a per-application or per-process level. Although a move to three nines may appear negligible, the loss in quality could be more than made up in savings.

Efforts to understand what is meant or implied by services levels will be key in 2010, with telecommunications suppliers and their customers possibly moving to a more easily understood commitment. Executives responsible for procuring services should evaluate the implications of changes to any services, while IT and telecommunications departments should constantly review internal users' requirements and tolerance for downtime. Service providers should constantly look at ways of reducing their maintenance costs.

The uncertain economic outlook and a general lessening of loyalty to technology platforms and providers will shorten future contracts. Contract lengths will be affected by the consumerisation of technology and the growing propensity to change suppliers, or even to purchase on a pay-per-use basis.

In 2010, the global telecommunications sector will focus heavily on reducing CO2 emissions, with cost control being the common driver in developed and developing countries, the Deloitte report concludes.