Essentia’s 2022 Forecast for Telecom, Cable & Enterprise
Listen, we’re not network infrastructure soothsayers. We don’t have actual visions about telecom workforce availability or the next big merger or acquisition in cable. (However, we do know where your lost remote is: Look in the freezer next to the empty ice cream carton).
But when it comes to making industry forecasts, we’re not throwing darts, either. After all, we are the experts who our clients trust to deliver first. And because we boast top-shelf subject matter experts from all corners of communications – including telecom, cable, and the enterprise space – we have a big-picture perspective that few possess. Of course, our folks are also adept at drilling down to reveal more nuanced coming attractions worth keeping an eye on.
And in a country where we let groundhogs predict the seasons and put credence in fortune cookies, that’s a pretty high standard.
So, we hope you’ll find the following predictions for ’22 to be illuminating. Don’t worry, we’re an accountable team, and we’ll check back later this year to see how our prognostications stack up with reality.
On that note, here we go…
A Workforce Running on Empty
You don’t need psychic abilities to project how current workforce dynamics might play out this year. With unfilled positions, other industries poaching frontline workers, the disconnect of remote work, and savvy veterans leaving on new adventures, the staffing issues we’re facing today could grow exponentially in the near term.
As one operations executive told us, “So many people have taken hiatuses in the past 2 years that it is leaving the industry with brain freeze.”
And it doesn’t appear that The Great Thaw is happening anytime soon.
The predicted workforce fallout runs far and wide, from a growing shortfall of skilled frontline workers to the continued slow roll-out of true 5G.
But this doesn’t mean everyone is set to feel the sting of being understaffed. The companies that figure out how to hire most effectively in today’s challenging climate will win. This starts with building a thriving culture from the inside out, one that attracts and retains top talent. Pursuing Great Place to Work Certification is one way we’ve cracked the recruitment code at Essentia. This prestigious recognition is based entirely on what current employees say about their experience at the company. Plus, it provides a proven road map for navigating which strengths to leverage and weaknesses to address to avoid growing pains.
More Industries Will Retire Manual Processes
While many companies continue being mired down by legacy workflows and tools that belong in a museum, more enterprising outfits will leverage the benefits of automation. This is especially important as it relates to workforce gaps. That’s because automation has the power to be a true workforce multiplier. And more and more industries are coming to this conclusion. Take cable, where we grew our division in 2021 to provide MSOs OSP and ISP services that will help them achieve what’s long been elusive: standardization. We have already begun transitioning MSOs from using old designs and stagnant “technology” (e.g., wheels, sticks, and paper) to embracing drones and automation. Another high-tech sector seeking to evolve the way in which they deploy infrastructure is edge data centers, which are set to appear in exciting new shapes and sizes – creating deployments that are an ideal match for Essentia’s tools and technology.
Another Banner Year for Fiber? Not so Fast…
In 2021, fiber grew 12 percent to now reach 60.5 million homes, which represents 43 percent of U.S. households, according to Fiber Broadband Association research. And with investment in fiber at its highest ever levels, 2022 is poised for another spike – at least on the surface.
When you take a closer look at the underlying dynamics of FTTH, it gets complicated. That’s because the major carriers and MSOs, as well as growing number of Tier 2 providers, are all competing for the same resources. These include…
- Workforce: We talked about this already but bringing fiber to cities and suburbs home by home (and other premises) requires labor. And a lot of it.
- EPC partners: Carriers and cable MSOs’ labor concerns aren’t confined to their own organizations. They’re also facing heightened vulnerability around their relationship with EPC vendors. With nearly all infrastructure sectors set for a spending boost, companies from other industries will look to tap into the resources normally consumed by telecom and cable. The carriers and MSOs that resisted pursuing overly aggressive price cutting, shunned extended payment terms, and treated EPC vendors like true partners will see their efforts pay off as others struggle to retain these critical resources. That said, even those companies fortunate enough to retain their vendors may still experience longer lead times.
- Market share: The faster that carriers and MSOs can figure out the above challenges, the faster they can stake their claim to new markets. Make no mistake; the land grab is on. If you’re not first or even second to market, the economics for bringing fiber to a new market collapse. (While you’re doing the math, don’t overlook the invaluable role that a tip-top government affairs strategy can provide.) With the ability to cut project timelines by 6 months or more, our eSpeed Technology Platform gives companies an edge right out of the gates. And this head-start translates to much more than mere time savings…
Small Cell Continues its Retreat – with Notable Exceptions
We get it; 2021 was a bust for small cell. And when we ask our Magic 8-Ball whether 2022 will be any different, we consistently get the same answer: “Reply hazy, try again.”
On one hand, we saw companies including Crown Castle fall short of their Small Cell projection – a trend that’s likely to drag into 2022 for the big players in the space. But other areas, including small cell deployed for indoor enterprise installations, appear poised for break-out growth. And looking even further ahead, small cell is predicted to take off well into the decade – with a predicted 54% CAGR through 2028.
The Rise of Private Networks
Rising from the ashes of DAS like a Phoenix are 5G private networks. Checking both the data security and cost-effectiveness boxes, private 5G / LTE networks are predicted by some to experience a 40-percent CAGR by 2028. That said, their aforementioned cost-effectiveness is reliant on using EPC partners that understand the manifold differences between deploying Wi-Fi and deploying private networks. Look for the growth of private 5G networks in manufacturing, utilities, healthcare, public school systems, and other verticals.
Waiting to Ride the mmWave
For consumers, who are frequently shown carrier commercials promising instant gratification via of 5G, the mmWave appears to be an imminent upgrade on the verge of changing their lives for the better.
The second half of this is true: 5G’s massive impact can and will be felt from livestreaming to autonomous vehicles. The same is true for IoT and AI. But true 5G is far from imminent for huge swaths of the U.S. population, where low- and mid-band 5G might be the best that users can hope for. Workforce challenges, internal skirmishes over competing technologies, and a reliance on outdated processes and workflows are slowing and diluting the roll-out of all 5G, especially high band mmWave 5G.
We will see pockets of progress, but the middling progress made in 2021 will likely seem lightning fast when compared to the mmWave growth we see in 2022.
Cable Has a Moment
Based on our engagement with MSOs, we see 2022 as the year that they begin to move on from height sticks, wheels, pads, and pencils – and begin embracing automation for OSP and ISP projects. Expect cable to grow despite the growing popularity of FTTH – and in part because of fiber’s challenges. (Plus, consumers still love watching TV and having a single monthly bill with packaged incentives.)
That’s how we see the future today. How do you see your future? To learn how Essentia can make sure your deployments don’t fall behind in 2022, reach out today.