2023 was a notable year marked by the emergence of generative AI and, more specifically, ChatGPT. While digital transformation and, in the telecoms space, 5G monetization, remained key themes this past year, AI unquestionably dominated the entire business landscape. As we prepare to turn the page to 2024, here are our predictions and expectations related both to the billing and subscription landscapes, and to the broader digital transformation and technology arenas.
A calming on the GenAI front
A year ago, generative AI was seen as the solution to every problem under the sun. Companies frantically searched for ways to integrate AI into their businesses. In recent months, a deeper understanding of the true nature of GenAI has slowly taken hold with a recognition that it is an imperfect tool, good at some things but also prone to potentially dangerous errors – and not necessarily of value to all businesses. We don’t see the chatter around GenAI fully dissipating anytime soon, certainly not in 2024. But we do expect a little less noise with more companies, perhaps onetime AI bandwagoners, realizing that having a solid story around how they intend to leverage AI need not be a prerequisite for success.
Read the Gartner® Hype Cycle™ for Generative AI to understand which AI innovations are likely to become mainstream, and when
More fulsome embrace of pure cloud
Digitization cannot occur without modernizing back-office infrastructure. In the year ahead, enterprises that may have been slow or hesitant to fully adopt cloud computing or pursue a SaaS deployment will get more serious about taking the steps to address infrastructure shortfalls in more meaningful ways. We will continue to see an increased recognition as to what constitutes a legitimate cloud solution. Many legacy vendors continue to falsely peddle private cloud as an option for a modernized BSS, when in point of fact they are simply offering a “managed hosted” version of their legacy on-premises platforms.
With the help of industry analysts and journalists, enterprise buyers are getting wise to the fact that if software wasn’t designed explicitly for public cloud then it can’t ever deliver on public cloud’s promises of elasticity, lower TCO, and increased business agility. Expect the hyperscalers themselves to get more aggressive in their direct and indirect offerings of applications built for and deployed in their environments, underscoring not only continued public cloud adoption in general but also their desire to go up the stack and avoid commoditization.
Shake-ups for telcos not monetizing 5G
The telecommunications industry invested heavily in 5G networks in the hopes of unlocking revenue opportunities through new services and expanded partnerships. So, how’s it going? Iain Morris of Light Reading sums it up this way: “Billions of dollars have been invested in 5G and yet there has been little or no discernible impact on telco sales. Forget self-driving cars, remote-control surgery, and other outlandish visions – for most telcos, it has barely moved the needle in the business sector so far.” Capitalizing on 5G investments will necessitate a foundational shift in thinking in the year ahead. Telcos need to move away from the network first, pipe-providing, one-size-fits-all approach and start thinking and selling like the multi-faceted, service provider businesses they want to become. Not all will succeed, leading to shake-ups across the industry in 2024, not to mention less appetite to even start considering new 6G investments.
Amazon domination under threat
Amazon Web Services (AWS) has long established itself as the market leader for cloud infrastructure. However, competitive providers have matured and evolved and now offer similar robust features at lower prices. Companies have generally been resistant to disrupting their businesses by moving from one cloud provider to another. The expanding competitive landscape for cloud services and cost benefits could make switching providers worth the inconvenience, potentially imperiling AWS’ hold on the market.
Increased M&A despite ongoing threats
Pervasive economic pessimism has stymied M&A and dealmaking activity over the last year. The business world has been stuck in wait-and-see mode amid recession concerns and ongoing geopolitical strife. It’s become clear that these external challenges are not going to be resolved anytime soon. Companies eager to expand their functional footprints or product portfolios will tire of waiting for a return to normalcy, spurring a resumption of M&A activity in the year ahead.
From accelerating digital transformation projects to advancing 5G monetization efforts to fully capitalizing on the benefits of pure cloud and AI, commercial success for so many enterprises and industries in 2024 will be dependent on the presence of a modernized, flexible, and high functioning back-office technology and billing system.
Learn how Aria’s cloud billing solutions and partnerships with best of breed BSS providers can support your business in 2024 and beyond