Introduced more than a decade ago, blockchain technology today needs no introduction. It has been widely adopted by the businesses cutting across industries, and its growth potential can be estimated by the fact that the blockchain market globally is expected to reach $16 billion by the year 2024. The growth story of the blockchain predicted specifically for the Asia Pacific region is even more interesting with estimate pegging its growth at a compounded annual growth rate (CAGR) of 87%. There are many application areas where the blockchain technology is currently being used, and the Indian government is specifically exploring the ways to use it for keeping the records safe and secure in the land registration, judicial services, and transportation sector. The private sector too has shown immense interest in the blockchain with one of Asia’s largest conglomerate Reliance Industries using the open ledger technology for its trading finance business.
Blockchain and Telecom Sector
Among others, the telecom sector has witnessed a sharp increase in the use of blockchain. According to a report by IBM, more than one-third of the communication service providers across the globe have already adopted the blockchain technology or actively engage in exploring the ways to use it. Bigwigs of the telecom industry which includes the likes of BT and AT&T have filed a number of blockchain patents while the others like Telstra and Verizon are investing heavily to come up with their versions of blockchain platforms and frameworks. Also, IBM has recently completed a pilot blockchain project with Telecom Regulatory Authority of India (TRAI) to ensure the safety of mobile numbers data records.
Merits of Blockchain Adoption for Telecom
The primary reason behind the adoption of blockchain by the players across the telecom ecosystem is the rising concern about the safety and security of the data. Customers today have become very much sensitive about this privacy and adoption of blockchain is one way to reassure them that nobody will breach into their private information. This is helping all the players in the ecosystem as they can share the data with other stakeholders without fearing hacking or leakage of the information. Further, various deliverables involved in the process can be transferred between different parties without any time or quality loss which, in turn, is going to have a positive impact on efficiencies of processes.
Despite all these positive cues, there are still some concerns about the adoption of the blockchain with the most prominent one relating to its evolutionary nature. Many experts are skeptical about the potential of blockchain as they continue to have their doubts about whether blockchain can deliver on all these aspects or not. Gartner last year suggested that the technology may not be fully developed yet to justify its hype and it lacks in the number of applications that can be used organization-wide by the telecom sector. The similar sentiment was echoed by GSMA which said that the technology has yet to develop and manifest its contribution to the industry fully.
Another critical challenge for the blockchain is its lack of interoperability and standardization. GitHub, a cloud-based service provider, has more than 6,500 blockchain projects to its credit but all of them use a different kind of protocols, coding languages, and privacy measures. This raises a concern about lack of standardization which has to be addressed if the blockchain technology has to become an integral part of the telecom industry. The industry has searched for a solution to this issue, and many believe that forming consortiums can help to develop standardized blockchain applications for companies. There is no denying of the fact that blockchain is going to disrupt the conventional practices across the industries and it is just a matter of time before the challenges like interoperability and lack of standardization are overcome. Once that happens, the telecom industry is sure to adopt blockchain in a big manner.