Telefónica Public Policy & Telefónica España Regulatory teams
Article originally published here in Spanish
The telecommunications sector is exploring how to create new services and improve its processes by means of blockchain. In this instalment of #RevoluciónBlockchain, Eusebio Felguera and Christoph Steck highlight some of the numerous applications it may have for telcos, including its use to integrate third-party services, its implementation in managing intellectual property rights and its potential as a system to streamline audits within corporations.
The general public still tends to automatically associate blockchain with cryptocurrencies, which is understandable, given that this is what is most often presented in the generalist media, but it is only the tip of the iceberg. Operators are exploring the full potential of blockchain beyond the above uses and, even though we began to focus on this technology almost two years ago, we’re still finding out just how far it can take us and what it’s capable of offering us. And not all the applications are obvious.
In the telecommunications sector, blockchain is conceived as a tool for focusing on what our business really consists of: giving new and better services to our customers in the digital era.
The birth of Blockchain, the decentralized company
Blockchain forms a key part of the innovation which is currently occurring within the operators’ service accelerators and incubators. This new wave of innovation uses blockchain as a tool, not as an end in itself.
When launching a new project in which part of the service control involves having to manage a database or a larger registry, we can implement it ourselves, as companies have always done, but is that really a telco’s goal? The answer is no. Even more so if it is a start-up, in which the professionals are motivated by trying to break into traditional businesses in a new way or solving problems which have proved insoluble until now. Therefore, when managing a larger registry is not the core activity, what is needed is for a third party to do it, to do it in a reliable and scalable way which does not generate problems in the future. Which is when out attention turns to blockchain technology.
Third-party services
What blockchain will provide is astonishing if we look ahead no more than five years. With this technology it is possible to incorporate third-party services into the services of a company, without having to do anything specific, just by using blockchain. In this way, services can evolve in ways which were not initially conceived. As explained in the book titled Blockchain: the industrial revolution of the Internet, blockchain takes inter-operability between companies to a new level and represents a great leap in the collaborative economy.
In addition, within the context of the open source philosophy applied to entrepreneurship, companies feed on advances previously generated by others when they are useful to them, incorporating them into their processes. However, this situation may generate problems related to use right management. In view of this situation, blockchain is presented as an unbeatable tool for automating intellectual property. For example, Spotify has recently acquired the Mediachain company to handle the issue of intellectual property. Why would they create it if it already exists?
Blockchain is presented as an unbeatable tool for automating intellectual property
Another aspect applicable to the sector, which is also of interest to the public administrations, is that it enables any entity to audit its activity without interfering in the business. This is possible because the blockchain technology means that, by default, everything is traceable and verifiable, as well as accurate. There is no place for tricks or interpretations. Regulation and the laws will undoubtedly have to evolve to adapt to the new realities of this technology, but the good news is that the advantages of using it will become visible very quickly.
