The Blockchain Boom: Exploring the Telecom Industry’s Journey Towards Decentralization

• Vikas Kumar
• June 28, 2023
• BLOG, TELECOM & IT
• Blockchain, Blockchain Market, Blockchain Market analysis, Blockchain Market forecast, Blockchain Market Growth, Blockchain Market Share, Blockchain Market Size, Blockchain Market Trends
• 0 Comments

A Blockchain is a shared digital ledger maintained by a network of computers offering a secure, direct method to deal with each other, without an intermediary like a government, bank or other third party. It maintains a decentralized record of transactions. It uses distributed ledger technology; it facilitates recording transactions across distributed infrastructure over public or private networks.

Blockchain technology enables immutability of records, auditability, traceability of positions and embedded security. Value offered by blockchain is well understood by communications service providers. A study conducted by Greyhound Research, found that 50% of all the CSPs globally are discussing the use of blockchain or have started implementing it for select use cases.

The global Blockchain Market size in the telecom industry is expected to be USD 38.9 billion in 2029 from USD 0.29 billion in 2021 with a CAGR of 84.3%.

Functions that avoid data manipulation and makes blockchain secure are

Example Use cases of Blockchain

Reduced risk and lower compliance costs– As trust is replaced in the system, fewer risk checks are needed. For ex- KYC guidelines, transactions are approved by consensus.

Cost-efficient transactions– Elimination of middlemen to authenticate transactions provides economic incentives.

Automated and secure contract fulfilment– Smart contracts trigger transactions automatically upon fulfilment of contract criteria.

Network transparency– It provides the ability to view the status of transactions or item positions at any time.

Blockchain Use Cases in Telecom

Roaming & Settlements– At present, intermediaries control roaming partner settlements and their resolution could take up to 2 months. This structure leads to human errors, lack of transparency and poor customer experience. Smart contracts using Blockchain can reduce the role of intermediaries by automating these settlements and providing a real-time view to all the stakeholders. It can reduce roaming fraud, and instant settlements.

Identity management– KYC is handled by multiple third party agents. It is a critical process and is fraught with misuse & leakage risk. Blockchain Solutions can provide decentralized storage of these documents, providing individuals with the full control with whom the documents are shared, reducing instances of forgery. With Blockchain, telecom providers can offer Identity as a Service (IDaaS) and act as the channel between the consumers and digital services.

SLA Monitoring– Vendor disputes and delays in settlements are not unusual due to delays in interpretation of SLAs. Smart contracts can limit such disputes by creating one version of the truth by offering transparency with real-time data.

Prevention of Phone Theft– Telecom operators have limited capabilities to detect a stolen device and rely on the Global Operator Database, which requires periodic updation. A Blockchain solution can allow telecom service providers to store unique device/SIM data on the blockchain, allowing them to block a stolen device immediately and also keep a third party informed, enabling telecom operators in other countries to detect the stolen device.

Mobile Number Portability (MNP)– MNP services suffer with high processing time and delays, caused by data mismatch between operators. A blockchain solution can streamline the requests for MNP with the availability of real-time, transparent and immutable data, creating a single source of truth on the network.

Conclusion

Blockchain technologies ensure the security of consumer documents by eliminating the need for submissions to third party members by automating the process. In business agreements, it ensures there are not different versions of truth, smoothing the completion of contracts, reducing disagreements and fraud by providing immutable, traceable transactions. It also provides economic incentives by reducing processing fees as the needs for third parties are reduced.

Challenges in the adoption of the blockchain are the same as with any new technology that promises significant disruption. Clear regulatory frameworks need to be defined for the implementation of smart contracts.

Author: Abhishek Saini