Blockchain promises the potential to disrupt or transform business models in almost every industry. In the telecom sector, in particular, blockchain can provide unprecedented support for the required infrastructure and connectivity for voice, data, media, and other related services. Data exchange between networks calls for an extremely high level of data security, integrity, and inspection. That being the case, blockchain can help in ensuring the right levels of security and protection.
The ongoing buzz around blockchain
As a shared ledger that gets replicated across stakeholders in a network, blockchain enables companies to maintain the complete history of all transactions that happen between two or more parties. Since these transaction records are immutable, they can never be tampered with. Such immutability paves the way for increased security, transparency, and control for every transaction across the ecosystem while reducing the number of unnecessary intermediaries.
Offering distributed digital ledgers that are updated in near real-time, blockchain delivers chronologically placed, time-stamped, irreversible, and auditable processes while bringing down the number of third parties involved in any transaction. Through decentralized storage, a high level of robustness, and unmatched trust and confidentiality, blockchain is helping organizations across various industries:
- Enable greater transparency into transactions
- Improve the quality and speed of payments
- Enhance traceability of operations
- Improve accountability and integrity
- Enable high levels of encryption and security
How telecom companies can benefit
For the telecom sector, blockchain could be a real game-changer. Analysts expect the blockchain telecom market to reach $677.66 million by 2025, growing at a CAGR of 28.3% during the forecast period. This growth will primarily be driven by the increasing adoption of 5G, which could become a catalyst for widespread blockchain implementation.
- Fraud detection and prevention: Although developments in 5G are changing the face of the telecom sector, enabling faster and high-quality communications between users, it is also paving the way for increased instances of telecom fraud, which can cost the world $32.7 billion Blockchain sets the foundation for effective and timely fraud detection (and prevention) for telecom service providers – especially with a focus on roaming users. By bringing down fraud detection and resolution time, blockchain verifies the authenticity of every transaction in the network, helps in calculating the exact billing amount based on the services rendered, and enables instantaneous verification via smart contract terms.
- Simplified processes: Telecom operators often struggle with streamlining roaming processes, with issue resolution timelines sometimes shooting up to several weeks. Blockchain allows telecom companies to simplify these processes via real-time monitoring. Using blockchain, they can set thresholds to easily identify issues or breaches, plan for their resolution, and also bring down the time and costs of disputes.
- Enhanced authentication: Blockchain also allows telecom operators to set up high levels of identity and authentication mechanisms to prevent subscriber identity fraud and associated data breaches. By encrypting identities via secure sign-ups and logins, the technology can instantly detect false stolen or missed identities as well as attempts at data manipulation – thus allowing telecom operators to safeguard the authenticity of digital transactions.
- Increased transparency: Another appealing aspect of blockchain technology is the degree of transparency it brings. The traceability of information means no transaction or service can be unduly modified. The level of transparency that blockchain brings adds a degree of accountability, allowing telecom companies to safeguard privacy and control over data, whilst increasing transparency and efficiencies in transactions.
- Improved collaboration: Given the number of business transactions that now happen in the telecom ecosystem, blockchain enables interested parties to come together as part of a larger consortium. Through frequent communication between these stakeholders, blockchain ensures high-quality connectivity, service, and customer experience is provided along with required trust, security, and transparency.
Points to note
As a growing telecom company, if you are looking to boost operational efficiencies, embracing blockchain can help your strategies a great deal. Through streamlined collaboration and simplified processes, it can allow you to enable effective and timely fraud detection and prevention, ensuring all communication and transactions that happen in the telecom ecosystem are transparent, efficient, secure, and protected.
However, when opting for blockchain,
- Carry out a detailed cost-benefit analysis to determine how blockchain will boost your business outcomes and what roadblocks you can expect on the way there.
- Be aware of the different blockchain technologies, their maturity levels, as well as their significance in the context of your particular use case.
- Identify the areas of your business that will benefit the most from blockchain adoption: identity management, smart contracts, secure transactions, data usage tracking, or others
- Make sure the blockchain technology you choose supports the type and kind of data (and customers) you deal with
- Review required legal frameworks and compliance requirements before embracing the technology
- Ensure that the technology you opt for allows you to improve the security and authenticity of transactions
With the right approach, the right tools, and the right implementation, you can leverage blockchain to improve the immutability of telecom transactions, improve transparency and visibility of operations, paving the way for secure and smart contracts, and enjoy long-term business value.