Telcos companies Deutsche Telekom, Orange, Telefonica and T-Mobile US are testing as to whether blockchain could be used to create and sign inter-operator roaming discount contracts.
The current system requires the agreements to be drafted, signed and then implemented by hand. The main idea of this project is that by using blockchain, the process will become automated.
The reason why blockchain could be useful in this situation – apart from automation offered by smart contracts – is due to its role as a neutral and non-partial intermediary, which is trusted by both parties. Blockchain authenticates both parties and facilitates the transfer – of either information or money – between the two, without either side having to put their faith into the other.
“This innovative development provides a new layer of trust, as the agreed-upon terms cannot be subsequently changed or tampered with,” said Deutsche Telekom. “In addition, it allows a holistic, analytic view of agreements, enabling further automation of the roaming wholesale workflow in the future, for example settlement processes between operators.“
There are of course, alternative ways to do this, however blockchain doesn’t need the same degree of administration that a normal middleman does, so it is expected to offer high efficiency at much lower costs.
Cost and efficiency is an increasingly critical issue to roaming.
The introduction of offers such as roam like at home and the abolishment of roaming fees in the EU, have resulted in decreasing international revenue. In 2019, Juniper research predicted that, overall roaming revenue will remain flat at $51 billion per year for the next four years. This is despite a continuous rise in the number of international travelers.
Also, roaming is becoming a much more complex concept, as telcos are looking to offer a broader range of cross-border IoT services delivered by various access technologies, such as LTE-M and NB-IoT. Businesses cannot be expected to pay expensive roaming fees to collect data from potentially hundreds of sensors that are attached to assets being shipped to or passing through other countries.
Furthermore, the cross-border IoT marker is predicted to become much more competitive due to the emergence of satellite IoT. Several players are in the process of deploying small satellite constellations that will offer global coverage in remote areas. An example of this is Sklo, who plan to deploy NB-IoT connectivity at low cost, using satellites that are already in orbit.
Consequently, there is pressure on telcos companies to simplify their roaming processes and this is where the blockchain should come in to play.
“The inter-operator workflow in roaming has been basically unchanged for the last 20 years,” said Rolf Nafziger, SVP of Deutsche Telekom Global Carrier, in a statement.
“In the near future however, new services like NB-IoT, LTE-M or VoLTE and other quality-based services will drastically increase the complexity of inter-operator discount agreements and respective settlements,” he said. “This blockchain-based solution is the start of automating sections of our workflow. It will put us in a position to handle the additional complexity while increasing overall efficiency.” The system was developed by T-Labs, but Deutsche Telekom said plans are underway to open-source the code, making it free-to-use by other telcos.