Rising proliferation of mobile internet and cloud technologies is expected to drive growth of the global telecom API market during the forecast period
Rising adoption of mobile internet and cloud technologies is expected to boost the use of the mobile application in the near future. According to the Cisco Visual Networking Index 2014 - 2019 report, the monthly global mobile data traffic is expected to rise at a CAGR of around 57% from 2014 to 2019 and is expected to surpass 24.3 Exabytes by 2019. Furthermore, according to the Groupe Speciale Mobile Association (GSMA) Mobile Economy Report 2015, the number of people using mobile Internet is expected to reach 3.8 billion by 2020. Rapid growth of mobile cloud is expected to accelerate adoption of telecom API for data and video storage in telecom-owned cloud systems. Hence, these factors are expected to drive growth of the global telecom API market during the forecast period.
Increasing access to 4G LTE network is expected to propel the global telecom API market growth over the forecast period
According to GSMA Intelligence, 352 telecom carriers had launched 4G LTE (Long-Term Evolution) networks across 124 countries until January 2015. 4G LTE offers high-bandwidth internet connectivity for uninterrupted audio and video streaming. Furthermore, 4G LTE provides voice over LTE (VoLTE) based on IP multimedia systems thereby allowing high-clarity voice. 4G LTE eliminates the need for separate networks for voice and data for a given telecom tower. VoLTE can be deployed with RCS and video calls over LTE, facilitating MMS, chat, file sharing, and video transfer. Thus, these factors are expected to propel the global telecom API market growth over the forecast period.
The telecom API are used to create compatible applications for multiple devices under a particular network. The telecom API’s offers Customer Service Point (CSPs) to integrate features such as Real-time Communications, Messaging, Payment options and many more. There are several countries such as India and Spain who have imposed lockdown due to the COVID-19 pandemic. Owing to this, companies are conducting meetings on online platforms and also increased spending on IT infrastructure due to government rules and regulations. For instance, In July 2020, Department of Communications of India ordered IT companies to extend work from home for their employees till 31st December 2020. The increasing spending on IT infrastructure is expected to drive the growth of the given market during the forecast period 2020-2027.
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Market Dynamics- Restraints
Over the top (OTT) service providers cutting revenue and margin of telecom operators is expected to restrain growth of the global telecom API market during the forecast period
Over the top service refers to services such as audio, video, and other data through the internet independent of telecom carriers. Telecom carriers incur infrastructure costs and can only charge for the amount of data is used by end users. On the contrary, OTT service providers can generate additional revenues depending upon the service provided. Introduction of VoIP is decreasing the demand for voice-based services provided by telecom carriers. The amount of revenue generated from telecom carrier services such as SMS, MMS, and voice services is declining, owing to the presence of OTT services. According to GSMA Intelligence, the use of traditional SMS in order to communicate between person-to-person (P2P) has dropped by double-digit percentages quarter-over-quarter between 2010 and 2011. Hence, these factors are expected to restrain growth of the market during the forecast period.
Telecom carrier outlook towards adopting open telecom API is expected to hamper the global telecom API market growth over the forecast period
A large number of telecom carriers are increasing including telecom API services in their portfolio. However, very few telecom carriers such as AT&T, Inc. and Orange S.A. are opening up their telecom API platform to external developers. Most telecom carriers consider application developers as value-added resellers and provide a business model that exposes less of the API platform to the developer. This restricts the possibilities for innovation in telecom API platforms and developers are not able to create applications using telecom API. Opening the telecom API platform to developers is expected to generate revenue by creating more applications. Hence, these factors are expected to hamper the global telecom API market growth over the forecast period.
Rising adoption of machine-to-machine (M2M) devices can present lucrative growth opportunities
The connectivity of M2M devices with smartphones is expected to increase in coming years and is expected to further increase the demand for telecom network APIs. According to the Cisco Visual Networking Index 2014 - 2019 report, the number of M2M connections is expected to reach 3.2 billion by 2019 and is expected to rise at a CAGR of 45% from 2014 to 2019. Telecom carrier companies such as Orange S.A. and AT&T, Inc. have started offering M2M platforms to integrate mobile devices with M2M-connected devices. According to the GSMA Mobile Economy Report 2015, the total number of mobile M2M connections are expected to grow at a CAGR of 26% between 2014 and 2020. M2M devices include wearable watches equipped with sensors, smart homes, and home security systems. These devices are able to connect with smartphones and share information. Smartphones utilize this collected data and convert it into meaningful information for the end-user.
Research and development activities among market players can provide major business opportunities
Key players operating in the market are focused on research and development activities, in order to enhance the product portfolio. For instance, in September 2013, AT&T Inc. launched an enterprise-focused API program that allows enterprise customers to innovate using AT&T network APIs. Furthermore, in November 2015, Apigee Corp. introduced Apigee Identity APIx, an API-based solution that empowers mobile network operators to deliver and manage security services.
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