Predictably, fair share dominated most of the opening day’s sessions, with renewed calls for consolidation a close second
Keynote 1: Vision of an open future
The opening keynote MWC was the positioning of the so-called ‘fair share’ debate, which is likely to dominate the conference in the same way 5G and the metaverse has in previous years. José María Álvarez-Pallete (Chairman & CEO, Telefónica) stated his belief that operators have a unique responsibility to help turn ambition into reality, with connectivity the foundation of everything digital. He added, however, that achieving key goals will require collaboration, as well as ensuring that all actors contribute a fair share of the effort – a nod to the ongoing debate in Europe.
Christel Heydemann (CEO, Orange) was more direct, reiterating the operator’s position that large traffic generators should support Europe’s connectivity requirements. In her view, the situation for the region’s operators has become ‘paradoxical’ over the past 10 years, with intense competition, consumers expecting to pay less and get more, outdated regulation, and pressure to invest (which has been difficult to monetise). Given these headwinds, she considers the sector is at a crossroads. For the EC to achieve the Digital Decade targets by 2030, fair share rules should start by acknowledging the current imbalances in the internet ecosystem, and mandating direct payments from tech firms to operators. Heydemann argued this is something that could be done easily as operators are used to implementing wholesale agreements, for example for fibre access. She argued that fair and direct contribution to network costs for investments can be made privately, and therefore reduce the requirement for public money for broadband deployment.
Thierry Breton (Commissioner for the Internal Market, EC) introduced the EC’s recently published consultation on the future of connectivity, stating that it’s a critical moment to step back and assess investment needs and regulatory framework. Fair share (which has been pitched as big tech versus big telco), will be just one piece of the puzzle, with other initiatives – such as the Gigabit Infrastructure Act – intended to support the rollout of networks. He stated that regulation needs to keep up with its time – “we still rely on regulatory frameworks that were designed during an era of circuit switched networks when operators were forced to open their copper networks.”
Keynote 2: Delivering the Digital Decade
Doreen Bogdan-Martin (Secretary-General, ITU) used her keynote address to outline the actions that must be taken to promote digital development and ensure no one is left behind. The list includes reaching consensus on global technical standards, including for 6G (noting that for the first time energy efficiency will be explicit in mobile network specifications). She highlighted the need to make the most efficient use of finite spectrum possible, which is a building block of the mobile industry that should be shared equitably and responsibly. Börje Ekholm (CEO, Ericsson) also raised the importance of spectrum which he considers as critical to lowering costs, driving ARPU and improving customer experience. In particular, sufficient mid-band spectrum is vital to telcos reducing energy consumption and monetising 5G – for example, through use cases like FWA, which is driving new broadband connections in the US.
Tim Höettges (CEO, Deutsche Telekom), started with a ‘call to action’ to Europe’s telcos, with a stark warning that they risk soon becoming irrelevant given the scale and profitability of US hyperscalers. He said the situation is not due to ‘stupid managers’, but as a result of the framework Europe’s telcos are operating in – which is over regulated, and over competitive. He made his now familiar call for consolidation and to realise a true single market which only then will have the scale to compete globally. He went on to say that Europe is not competitive in the digital space. Only 3/15 of the top semiconductor producers are European, 92% of all data of the Western world is stored in the US, and telecoms spend as a proportion of GDP in Europe is the lowest among Japan, South Korea, US, and China. His attention finally turned to the fair share debate, by pointing out that six content and applications providers (CAPs) are creating more than 60% of all traffic in the network, but that the investment burden isn’t being shared equitably. He referenced €55bn of investment by telcos, compared to the €19bn by big tech, of which, €18bn went into data centres, with only €1bn having gone into infrastructure. His ask: “contribute a little bit!”
Elsewhere around the conference on day 1
In a session focused on sustainability, representatives from across telecoms and tech discussed progress on their green agendas and the challenges to reaching net zero. Intel, Telstra and Qualcomm, underscored the need for collaboration to reduce carbon emissions, not only within industry but also with policymakers. Vodafone noted the support it has received from regulators in enabling it to decommission some of its legacy infrastructure, as it also uses customer data to optimise network performance. Ericsson urged greater sharing of data and insights across the value chain to help manage network energy consumption, considering that the sector had so far been cautious about sharing information so as not to risk breaching GDPR rules.
On a panel convened to discuss ‘breaking down fraud’, the scene was set by outlining that $48bn is expected to be lost to fraud in 2023, with $40bn lost to telco fraud alone in 2021. In 2020, the number of successful fraud attempts outnumbered those that failed, and it was agreed that current systems for identity just don’t work anymore. Self-sovereign identity was seen as an increasingly viable solution, although until that’s implemented it was agreed there needs to be more data sharing between telcos and tech companies. It was unanimously agreed that not enough is being done currently, but nobody really sure of the reason why. Suggestions were made that the processes don’t currently exist to facilitate useful sharing.
