What does the future hold for blockchain in telecommunications?
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What does the future hold for blockchain in telecommunications?

To dig deeper into blockchain and its applications within the telecom space, we sat down with product expert Douwe van der Heij to ask 5 questions about blockchain’s role in this ecosystem.

The transformations within the telecommunications industry look extremely promising. A future with ultra-low latency, 5G speeds will pave the way for 30 billion new IoT device entrants. This will not only power new use cases that enhance customer experience but will also expand operator revenue opportunities.

But what should mobile operators do to prepare? What happens when the operator partnership ecosystem expands and their billing and charging models becomes more complex? The good news is there is an answer, and it has everything to do with blockchain.

Once associated solely with crypto currency, blockchain has now fiercely entered the market, bringing efficiencies into the agreement and reconciliation process between mobile operators and partners around the globe.

5G is set to unlock new opportunities for mobile operators. Can you explain where the market is headed?

We’re witnessing a market shift toward what I call “universal commerce,” which means that operators are going to start to do more business with new partners as 5G technology is adopted locally and globally. And this doesn’t necessarily mean just roaming partners either. There will be companies in other verticals that will need 5G to implement new and innovative use cases. Operators will have an opportunity to capitalize on this market need and expand their revenue opportunities.

As new partners and entrants start doing business with operators, what considerations are there?

When IoT starts to take off and there are billions of new devices that enter the market, operators are going to need a way to clear and settle payment between partners. It will be key to centralize their billing and charging processes to handle large volumes of “smart contracts” and transactions between parties. Those parties must collaborate in an ecosystem where blockchain can help the industry to function with ledgers and trust. Trust is provided by the technology’s underlying cryptography and distributed consensus.

Tell us more about how blockchain will help operators with billing and charging.

Let’s take roaming for example. Currently, there are lots of questions around billing between partners. “my results look different than your input” is common. But, with blockchain, there’s what’s called a distributed ledger. With distributed ledgers, everybody has the same information in a private blockchain network. This ledger houses total volumes and calculations that are visible to both parties and uses agreement terms established for the relationship using smart contracts.

The good thing about a blockchain ledger is it can’t be changed or altered, reducing the likelihood of disputed invoices, as discrepancies – if any - are based off the same views on reality much earlier in the monetization process.

A clean audit trail and happy partners. Everyone wins.

Has blockchain been tested with operators yet?

Yes, we partnered with IBM earlier this year and launched a successful blockchain pilot with Orange and MTS for mobile roaming. The solution was designed to enable smart contracts to determine the rules and processes governing each roaming transaction between parties. Valuable efficiency gains were realized in clearing and settlement for roaming as well as increased operational efficiency, auditability, and smart-contract management for the operators involved.

Syniverse’s clearing and settlement expertise matched with IBM’s expertise in launching large-scale blockchain efforts made the pilot successful. We will continue to power additional use cases in the future for 5G and IoT as well.

What does the future hold for mobile operators?

With emerging technologies like IoT and 5G, we’re expecting to see an influx of new and exciting partnerships with new industry players, and expanded revenue opportunities within telecommunications. Syniverse will continue to sit at the middle of the ecosystem – bringing together mobile operators and partners to pioneer innovations that will revolutionize the telecom market for the better.