Blockchain in Telecom Market

Blockchain in Telecom Market Outlook (2023 to 2033)

The global blockchain in telecom market is expected to surge ahead at an astonishing CAGR of 74.8% and reach a valuation of US$ 80 billion by the end of 2033, up from US$ 300 million in 2023.

Blockchain has been dubbed the 'technology that brings trust where there is none', and although the technology has made its way into other industries, it is only now gathering steam in the telecom industry.

Blockchain is a decentralized technological solution for recording, collecting, and storing a digital asset transaction history between two or more parties. It is linked via cryptography to provide a transaction time stamp. Organizations use it extensively to avoid thefts, build transparent networks, expedite administrative procedures, combat fraudulent activities, and retain unique device data.

Blockchain is frequently utilized in telecommunications for identity management, connectivity provisioning, smart contracts, payment, and billing. It also contributes to rapid traceability and automation and increased operational effectiveness of the business process. Moreover, it keeps historical user records that cannot be tampered with and can be authenticated by other stakeholders.

The emergence of COVID-19 has underlined the importance of telecom infrastructure. The worldwide health crises have placed additional strains on telecom systems, implying that they may play a critical role in emergency events beyond mere connectivity.

Countries around the world are witnessing a significant interest in new fintech services as demand for online and virtual services grows. The pandemic also increased the requirement for greater data-driven services and digital infrastructure in the telecommunications industry. As a result, telecom firms are strongly focusing on network robustness and dependability, notably in 5G expenditures.

Blockchain and 5G are expected to change emerging technologies in the telecommunications sector. Blockchain guarantees peer trust and security in the same way 5G promises excellent speed and QoS (Quality of service). 5G is rapidly being developed around the world. It promises to provide high-speed internet, which will be necessary for a data-rich future.

Telecom enterprises, or communication service providers (CSPs), must ensure a range of access nodes and techniques to deliver ubiquitous connectivity across networks for billions of devices. Every telecom organization can conduct this centrally, which frequently results in delays and non-seamless provisioning.

A far more dependable and efficient option is to use a private blockchain that CSPs can access. The regulations and agreements among several CSPs can be defined in smart contracts and maintained on a private blockchain. Devices that seek to connect to the network have to broadcast their identity to the decentralized network.

Fact.MR, a market research and competitive intelligence provider, expects that such important factors will drive high global demand for blockchain in telecom over the next ten years.

Report Attributes	Details
Blockchain in Telecom Market Size in 2023	US$ 300 Million
Projected Market Value (2033)	US$ 80 Billion
Global Market Growth Rate (2023 to 2033)	74.8% CAGR
North American Market Growth Rate (2023 to 2033)	46% CAGR
Leading Application Segment	Smart Contracts
Key Companies Profiled	Auxesis Group Abra AWS Blocko Bitfury Blockcypher Blockchain Foundry Blockstream Blockpoint Cegeka

Why is Blockchain Technology Gaining Momentum in Telecom Industry?

“Increasing Emphasis on Identifying & Avoiding Telecom Fraud”

Blockchain is a top candidate for drastically cutting the expense of fraud, which will promote its acceptance in the telecommunications industry, considering that the industry is still attempting to establish a mechanism for preventing fraud efficiently and consistently. Scams continue to increase in the telecom sector, causing enormous damage year after year.

• According to the CFCA (Communications Fraud Control Association) survey, fraudulent schemes cost the telecom industry US$ 38 billion each year, making them one of the main factors responsible for revenue loss.

Moreover, roaming fraud and subscription identity fraud are among the most prevalent types of fraud in the telecom industry. Subscription identity theft occurs when a subscriber uses a fake identity or the identity of some other subscriber (the victim) to gain advantages. For example, scammers can obtain a SIM card in the name of the victim using stolen identification information.

Country-wise Insights

Why is the United States a Prominent Market for Blockchain in Telecom?

“Presence of Prominent Blockchain Technology Providers”

The North American market is projected to develop at a CAGR of 46% during the forecast period. Blockchain technology allows faster transaction processing and decentralized operations, alleviating several challenges that North American telecom operators are experiencing.

• The United States is the leading market in North America. The presence of large blockchain technology providers in the country is boosting market growth.

Moreover, several telecom companies, such as AT&T, are implementing blockchain technology to reduce roaming and identity fraud and enhance the customer experience.

Which European Countries are Increasingly Utilizing Blockchain Technology in Telecommunications?

“United Kingdom & Germany to Make Extensive Use of Blockchain Technology”

Blockchain is no longer considered merely a financial technology and a cryptocurrency instrument in the European market. Many telecommunication companies are making use of its capability to cut out the intermediary, saving money and reducing the chance of fraud and human mistakes.

• The EU General Data Protection Regulation substantially raised the fines for data protection law violations. Consequently, for the region's telecoms, the security of data housed on a blockchain platform is critical.

Furthermore, the United Kingdom and Germany are increasingly utilizing the technology as it enables concurrent record-keeping, automation, faster transaction times, digitization of business operations, supply chain management, and mobile money features. Many telecom businesses in these countries have teamed up with blockchain solution providers to reap the benefits of blockchain technology.

How are Start-ups Driving the Japanese & South Korean Markets?

“Start-ups Focusing on New Developments in Blockchain Technology”

Asia Pacific has enormous market potential, mainly due to the increasing significance of mobile payments in developing countries. Moreover, several start-ups in Japan and South Korea are focusing on new developments. Start-ups in Japan are creating blockchain systems that enable safe smartphone-based money transfers without the need for conventional banking documentation.

• For example, a Japanese start-up called Telcoin uses blockchain to help telecommunication companies perform money transfer services. Telcoin Wallet, constructed on the Ethereum blockchain, enables mobile users to make immediate global transfers regardless of local mobile service providers.

Category-wise Insights

Why are Smart Contracts Gaining Immense Popularity?

“Provide Superior Security and Lower Contracting Costs”

Smart contracts are computer protocols that are intended to digitally streamline, verify, or regulate the performance of a contract. Smart contracts are intended to lower contracting costs while providing greater security than standard contract law.

Smart contracts enable trusted transactions to be completed without the participation of third parties. By automating service-level agreements (SLAs), smart contracts can remove or drastically minimize the involvement of different intermediaries. This provides real-time visibility to all stakeholders and promptly makes any threshold breaches transparent to all parties involved.

• STC Bahrain launched its first Chainlink node in March 2022 to provide smart contracts with access to a safe source of real-world data and quick off-chain computations. STC Bahrain is the first major telco in the Middle East and North Africa (MENA) region to launch a Chainlink node, furthering the development of the smart contract ecosystem in the region and globally.

Furthermore, 5G technology is a notable example of how blockchain will alter the telecommunications business. For example, in 5G technology, smart contracts can employ a blockchain-based solution to expedite overall provisioning between the end user and the networks.

Blockchain can also improve identity management solutions. Customers currently undergo a time-consuming KYC (Know Your Customer) process that requires handing over or uploading sensitive information when registering for new accounts. This data is then held with a third party, putting it at risk of inefficient management, fraud, and even breaches or cyberattacks.

Incorporating blockchain into existing telecommunication networks can eliminate this risk since customer identities can be stored in a decentralized, unchangeable, tamper-proof ledger with no single point of failure.

Competitive Landscape

The blockchain in telecom industry is highly consolidated with only a few major players providing blockchain solutions across the telecommunications industry. The vendors are also receiving funding from investors, which will aid in the development of innovative blockchain services.

• Tech Mahindra and telecom analytics solutions supplier Subex collaborated in November 2022 to roll out blockchain-centered solutions worldwide for telecommunication operators. By reducing overall compliance difficulties, these solutions would reduce fraud and increase operational efficiencies for communication service providers (CSPs).
• Trai planned to introduce new blockchain technology to limit spam calls and texts in November 2022 in partnership with TSPs. The organization is developing several technologies, including blockchain technology, to identify spam calls and texts. In addition, the regulator is forming a joint committee of regulators (JCOR) comprised of Trai (the Telecom Regulatory Authority of India), MoCA (the Ministry of Consumer Affairs), SEBI (the Securities and Exchange Board of India), and RBI (the Reserve Bank of India).
• Global Telecom, a pioneer in wireless technology designing at the intersection of network and hardware, introduced its MERCURY series of tri-connectivity modules in February 2022, the first custom-built modules designed to allow connectivity to cellular, private, and satellite networks as well as Bluetooth and Wi-Fi. The MERCURY series from Global Telecom is the first to offer connectivity to all three wireless networks, as well as Bluetooth and Wi-Fi. It features hostless, patented, driverless technology with an extra layer of blockchain security.
• Bharti Airtel acquired Aqilliz, a Blockchain as a Service Company, through the Airtel Start-up Accelerator Program, subject to appropriate statutory approvals, in February 2022. Airtel intends to expand the use of Aqilliz's innovative blockchain technologies across its rapidly expanding digital entertainment, Adtech, and different digital marketplace products.

Key Segments of Blockchain in Telecom Industry Research

• By Provider :

  • Infrastructure Providers
  • Application Providers
  • Middleware Providers

• By Application :

  • OSS/BSS Processes
  • Identity Management
  • Payments
  • Smart Contracts
  • Connectivity Provisioning
  • Other Applications

• By Region :

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • MEA