New Business Models – How Do Our Clients Seek Revenue Elsewhere?

In our final blog in this series, we will explore how the opportunities presented by wireless mesh networks may bring the dream of a seamlessly connected world into reality. Mesh networks are a decentralised form of telecoms which can easily, effectively and wirelessly connect entire cities using inexpensive, existing technology.

Where traditional networks rely on a small number of wired access points or wireless hotspots to connect users, in a wireless mesh network, the network connection is spread out among dozens or even hundreds of wireless mesh nodes that "talk" to each other to share the network connection across a large area. The biggest advantage of wireless mesh networks – as opposed to wired or fixed wireless networks – is that they do not need to be wired to the internet to broadcast their signal. They are truly wireless, as in a wireless mesh network, only one node needs to be physically wired to a network connection. That one wired node then shares its internet connection wirelessly with all other nodes in its vicinity. Those nodes then share the connection wirelessly with the nodes closest to them. 

The advantages that mesh networks would bring to the UK network infrastructure are:

  • They are convenient where Ethernet wall connections are lacking – for instance, in outdoor concert venues, warehouses or transportation settings
  • Mesh networks are "self-configuring" – the network automatically incorporates a new node into the existing structure without needing any adjustments by a network administrator
  • Mesh networks are "self-healing" –the network automatically finds the fastest and most reliable paths to send data, even if nodes are blocked or lose their signal

BT launched the UK’s first network for whole home Wi-Fi in 2017, and the customer interest from both business and consumer audiences suggests that mesh network technology has significant potential to help create a new type of future UK network [1].

As customers increasingly see their mobile and broadband providers as a utility, there are opportunities on the horizon to partner with other utility providers. The majority of UK utility providers are dependent on faster broadband and enhanced mobile networks – reinforcing any potential inter-relationship between network providers and utility firms, and thus, benefitting the customer.  While this move is beneficial for the customer, we view this as also benefitting our clients as it will enable telcos to generate additional income by offering entire-home connectivity packages including internet, phones and now energy.

There is a move towards greater decentralisation of energy production, with consumers beginning to engage proactively in the market, due to the introduction of smart grids and smart meters in the home. The changes in the way electricity is being produced and consumed are having profound implications for energy providers’ networks (i.e. telcos). To cost efficiently manage decarbonisation of the energy system, a smarter, flexible approach needs to be developed. Many homes will evolve to support ‘connected living’, equipped with smart appliances, smart heating and lighting systems and with access to smart electric meters which will be enabled by IoT. But underpinning this must be a solid network infrastructure that is capable of allowing the consumer’s home to interact with the smart grid. In other words, telecoms networks are the mechanism through which the UK’s smart, low-carbon future must be managed. These projects will require robust infrastructure and backhaul that forms the spine of rural and to-the-premise connectivity, highlighting the continued need for investment in creating new networks.

With this in mind, it will be interesting to see if the UK follows the trend in the US and Australia (albeit on a small scale thus far) of joint ventures between telcos and electricity providers. A global study from Accenture indicates that consumers might view the trend favourably. Accenture found that 73% of consumers would consider buying electricity from companies other than traditional energy providers with 22 percent willing to buy from their cable or phone company [2]. Smart meters are likely to be the first step for our clients to expand into the utilities industry.

As the race to 5G dominance increases pace and importance, and telcos face cost, revenue and growth challenges, new business models in the form of entire-home connectivity packages and new infrastructure build approaches, such as mesh networks, will become key network differentiators for our clients. 

Additionally, the value of a satisfied customer is limitless, and there are opportunities available to those who invest in strong analytics and timely customer engagement.

If you would like to get in touch to discuss the opportunities and challenges highlighted and impacts on your business and your customers, please don’t hesitate to contact us through Kevin Clarke at kevinclarke@moorhouseconsulting.com.

[1] https://www.zdnet.com/article/bt-launches-the-uks-first-mesh-network-for-whole-home-wi-fi/
[2] https://www.greentechmedia.com/articles/read/the-merger-of-telecom-and-utility-services-is-it-the-future#gs.7uGLlbw

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Kevin Clarke Manager