MWC25 | Chris Lewis, Insight

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Chris Lewis

Managing Director

Lewis Insight

play_circle_outline Energy and optimism at Mobile World Congress, with emphasis on AI technology.

play_circle_outline Transformation of telco networks, challenges with 5G promises, and impact of Open RAN.

play_circle_outline The Evolution of Telcos in the Value Chain: Adapting to Market Dynamics through Collaboration

play_circle_outline Maximizing AI Potential in Telcos: Clean Data Sets Over Open RAN Distractions and Monetization

play_circle_outline Fragmented API market and its potential value

play_circle_outline Use of AI and technology for immersive experiences

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Chris Lewis, Insight

Chris Lewis

Managing Director Lewis Insight

Chris Lewis, a renowned expert from Lewis Insights, joins theCUBE at MWC25 in Barcelona to discuss the transformative trends shaping the telecommunications industry. Hosted by Savannah Peterson and Dave Vellante, the interview explores Lewis's insights on artificial intelligence, connectivity, and the evolution of the telecommunications sector. Lewis highlights the revitalized energy at MWC25, driven by innovations in AI and increased exhibitor participation, reflecting a positive shift in the telco industry, which had previously faced a period of stagnation.... Read more

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What was the speaker's experience at MWC like compared to their expectations? add

What has hindered the transformation of the telco network and the implementation of new technologies like Open RAN, despite the promises made by executives in the industry? add

What is the reason that the traditional telcos have not been benefiting from the data center super cycle driven by the AI boom? add

What is the importance of having a clean data set for AI analysis and the potential distraction of focusing on Open RAN and other open technologies? add

What are some challenges and opportunities in the API market, specifically in relation to mobile phones and identity security? add

What advancements or new tools have you seen being used in the industry recently? add

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Chris Lewis, Insight

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Savannah Peterson

>> Good morning CUBE community, and welcome back to Mobile World Congress. We're here all week with four days of coverage in Barcelona, Spain. My name is Savannah Peterson, joined by Dave Vellante. We've already had a banging start to the day.

Dave Vellante

>> Yeah, it was a good start with Shri Ambari. He's amazing.

Savannah Peterson

>> He is amazing. We could have gone on-

Dave Vellante

>> AI leader....

Savannah Peterson

>> for three days with him alone.

Dave Vellante

>> Future IPO.

Savannah Peterson

>> Yeah. No. Yeah. Exactly. Future IPO. Now we have a total CUBE legend with us right now. Chris, thank you so much for taking the time today.

Chris Lewis

>> It's part of being at MWC now, isn't it? To come and join you guys on theCUBE and talk about this wonderful industry, the energy that's around. A lot of my clients say to me that the telco world has had a bit of an uptick in the last year or so. A year ago it was quite a bit depressing, and now there's been a bit of an uptick. And I think MWC say there's more exhibitors than ever here. The energy as you walk through the halls is here. Obviously, AI is the fuel that's fueling all of this energy.

Dave Vellante

>> I was a latecomer to MWC. My first MWC was July of 2021 with Danielle Royston at Cloud City, it was empty. So, that was my first experience here. And so, I never really had a full grasp of the scope of this event, but it's quite remarkable, Chris. I mean, I always thought it was this deep telco event, it's not.

Chris Lewis

>> Not anymore.

Dave Vellante

>> It's such an innovative event. Savannah, I've never been to CES, but it's very CES-like. In fact-

Savannah Peterson

>> I compare it to CES often....

Dave Vellante

>> in this lovely glossy magazine that I have in my hotel room that GSMA put out, they have an article, MWC versus CES-

Savannah Peterson

>> Oh, I'll have to check that out.

Dave Vellante

>> Like the Rock 'Em Sock 'Em Robots.

Savannah Peterson

>> Well, it does feel like the European, I know there's evil-

Dave Vellante

>> ....

Savannah Peterson

>> but it does feel, I think I was telling Rachel, one of our production boys' partners yesterday how it is kind of like that. I find this show to be where Europe shows off a bit and shows off everything from their robots to their exciting new demo. There's a lot of meetings happening here. It's very similar in the scope of investment in the booths and the things that people do. I mean, there is a lot of capital outlaid to be here, to show off here, to set these meetings. It is the only show I think that compares. I mean, CES is bigger, but it's the only show that compares in terms of impact and velocity and just the passion. I mean, Chris, to your point, I love that you brought up the energy in here, and it really does feel different from last year. And it feels more uplifted, to your point, a little depressing was a great way to describe it.

Chris Lewis

>> I think the issue is that the industry feels hope that something is changing. So, you got a whole, very interesting, you've got a whole load of satellite stuff going on, which a few years ago there were hardly any satellite exhibitors here. I think there's over 100 here this year, which is amazing. And that's obviously fueled by starting to do cellular to satellite connection, which is really interesting.

Savannah Peterson

>> That's significant.

Chris Lewis

>> Bringing satellite into the fold as you were. And then the whole ... The trouble is that we had a bit of a lull with 5G where it didn't deliver against the promise that it was supposed to bring. And I think the AI piece, which changes everything in our lives, but it obviously changes within the telco world and the idea of automation and AI within every element of the industry, all the way out to the device. A lot of the time the industry used to talk about the inner workings of the mobile network and then about the fixed network relating to that. But now with AI it impacts not only the operational in the core of the network, it takes it right out to the edge and onto your device. So, suddenly the combination or the confluence of connectivity, security, analytics, storage, and of course, application content, it's suddenly a much more interesting proposition, because it goes all the way out to the edge.

Savannah Peterson

>> Well, I think I want to stay there for a second, Chris, because you just brought up one of my favorite points. I mean, we know 50% of data is at the edge. Mobile devices are going to be one of the many things that bring AI to people outside of the browser, bring it on the edge. Do you think that AI is responsible for this injection of energy that we're feeling?

Chris Lewis

>> Oh, I think it's certainly, well, if you go back a couple of years when we were all discussing the metaverse and the-

Savannah Peterson

>> Oh my goodness, what's that?

Chris Lewis

>> Which will come back, by the way. Metaverse hasn't gone away. We will build a metaverse and AI will be part of that. But yes, I think AI does, because it takes away from the idea that the complexity of the underlying technology, and it says we have tools now, obviously with obvious guardrails, but we have the tools in place that will allow us to bring all of those elements, the storage, compute, and everything together, and deliver it in a way that we want to have it delivered. And to your point, taking the knowledge out to the device rather than having to go all the way back into the network and to the data center. But I think we're also seeing a bit of a juxtaposition from the telco network, which is what MWC is all about. And obviously, the things that connect to it, and the data center. I mean, actually, at the same time as the network getting a bit of a boost, data center gets even more energy, because we need those data centers and all the GPUs to cope with all the stuff that we want to process, whether we do it there or whether we do it out on the edge. So, there's a building frenzy. Some people call it the Wild West. I'm hoping it's not the Wild West, but obviously people who've made the shovels made a lot of money out of the Wild West and the people with the shovels of the chips of the GPUs in this situation, aren't they? So yeah, the energy comes from a combination of many things, but it's finally beginning to deliver almost a hierarchy of how connectivity fits in with compute and how devices relate to that, and how that relates to the hyperscalers. So, it's a much more, the picture's settling down around the whole ecosystem, not just the mobile or telco ecosystem.

Dave Vellante

>> Chris, I wonder if we could back up a little bit. You have been following this industry for a long, long time. Like I said, I'm kind of a newbie, but you had the massive CapEx build out during the internet, and then what you saw was usage went through the roof, the cost per bit came tumbling down. The over-the-top providers made all the money. Meanwhile, the telcos provided this great infrastructure, the connectivity. You've always said, "Telcos are great at connectivity. They've proven that time and time again, super reliable networks, but those networks have been fossilized with proprietary systems."

Savannah Peterson

>> That's a good way to put it.

Dave Vellante

>> You talked about 5G, 5G hasn't lived up to its promises. I want to understand why. You've had CapEx associated with that. A couple of years ago you had the executives of the telco industry saying, "We can't let this happen again. We have to be able to monetize on top of 5G." It sounds like you're saying none of those have happened. You've got the Danielle Royston Cloud hyperscaler narrative that came in that potentially could help with those fossilized networks. And you've got the IT world and the telco worlds coming together, and then all of a sudden AI rolls in and that's the big conversation. And I feel like that first part of my narrative has gotten lost in all the AI hype. So, underneath it all the fundamental value proposition of all these telcos has been that great connectivity.

Chris Lewis

>> Yes.

Dave Vellante

>> And where are we with that? Where are we with the transformation of the telco network, Open RAN, the openness, better agility and all that stuff? Have we moved the needle since say we started talking about this five years ago?

Chris Lewis

>> The answer is, not a great deal, is the honest answer. And the reason for that is that when we deregulated the markets in the '80s and '90s, that certainly brought a lot of cash into the telcos. They went to invest in adjacent markets, very few of them succeeded in that. You then bought regulation in, which created lots of competition, lots of investment, which created the CapEx you're talking about, so lots of equipment sold, but the basic product hasn't really changed very much. And in fact, there's one strong school of thought, with which I do agree to a large extent, which is that we never used to have enough capacity to do what we wanted to do when we were connected. In the last 10 years we've got that capacity. So, when you've got a good broadband connection, about let's say 100 meg roughly on a fixed network and probably something similar on the mobile network, you don't need a lot more for most things you do. And a lot of the 5G case was built on, God forbid, remote surgery was most often touched upon, but actually, they've not materialized. So, we fundamentally need to build the telecom industry around what we deliver as product, not on all the promises of jam tomorrow, which we talked about in the previous generations. But what AI does twofold, obviously, it creates a lot more traffic, as we just discussed about from the edge coming back in. But it also creates opportunities for the telcos to severely rationalize their operational environment, so to automate it. You think of a classic telco. Wherever you live, there's some guy coming out a pole pulling cables, doing whatever, setting up antennas. We need to move away from that. And obviously, the robotization of some of that will help dramatically, leveraging drones to inspect mobile towers. So, we're going to enter the era of questioning what employment we have within the industry, but the end product doesn't really change. So, we're connecting things, but we're connecting it in the much broader ecosystem than before. Where it used to be end-to-end, your telco when your parents had that phone in the hallway and everything was controlled by Baby Bell, whoever it was, now it's embedded into everything that we do. So, the overall demand is much greater, but the connectivity is already there. We're already leveraging it. And so, it's not commanding higher prices, because the regulator environment has put competition in place. We said keeping prices down was the main issue. I think we're beginning to see another trend, which is the whole sovereignty issue within individual countries saying, "We want to ensure we have the right AI infrastructure to be able to leverage all those services for our economy." And so, there's a lot of build going into that. There's a lot of build going on, whether it's data centers and network, but we still fundamentally need to build the networks out. So, wherever you are in your car or out hiking in the country that you can be connected. Satellite fills some of that gap for rural communities, but we still need to make sure we build it for the benefit of "society" rather than just the pure commercial approach, which I think has been what's happened over the last 20, 30 years.

Dave Vellante

>> I'm inferring from your comments that this data center super cycle that we're in because of this AI boom hasn't really been a tailwind for a lot of the traditional telcos. Why is that?

Chris Lewis

>> Well, there's one issue that you have to bear in mind is that the way the telecom industry was structured, telco used to build all of the global networks and they put all the cables in the ground and built the submarines and all submarine cables and the like. What we're now finding is that a lot of the transatlantic cables and the global cables are being built by some of the hyperscalers, so they're the ones with the money flowing around. They're making, as you said, the money over the top at the top of the pyramid. The telcos often retrenching back to be sometimes national, sometimes regional players, so they're just, they are benefiting from this, so they're providing connectivity. But at the same time the connections that we all have at home is obviously consumer broadband is one thing. The connections into the business environment, obviously that has come down in relative price, because we used to pay for expensive private circuits, T1 in the U.S., E1 here in Europe, they were phenomenally expensive. We've now got this overlay of SD-WAN, which allows us to leverage whatever connectivity is available, makes it much more competitive. So, a more competitive market in the business environment, even though there's way more demand actually brings prices down relatively.

Savannah Peterson

>> We're covering a lot here, and this is great, you're a perfect person to ask. No, this is awesome. I'm like, every time you come on the show I know that I'm going to learn a lot. And I love that feeling. I'm curious, because you have such a good lay of the lands, what do you think is the biggest myth in the industry right now? What do you think is a distraction versus what's at the core?

Chris Lewis

>> There's a number of them, right? Well, one of the questions that I always think of is, how long will we talk about AI? Will AI disappear from the vernacular and we'll just call-

Savannah Peterson

>> Exactly....

Chris Lewis

>> someone else in a few years' tune?

Savannah Peterson

>> It'll just be in there.

Chris Lewis

>> But that's not one of the issues. AI, we absolutely need it. I think the biggest issue around it is we need to have a clean data set within the telcos, within businesses. Because if you use AI on dirty data, guess what comes out? It's not very pure what comes out. I think the myth is that the data is there to be analyzed. I think there's a massive cleanup job required on the data. I think the open question, and whether it's Open RAN or open Wi-Fi or all those things in some ways to me is a big distraction. And I'll get shot down for saying it by many players in the market. But actually, it doesn't change the end product. It might change the supply chain a bit. It often has an integration tax on top of it, which frankly we can do without. I'm somewhat against that market, and people know my views on it. This event has spent way too much time on Open RAN, for example, and I suspect the AI, Open AI RAN or whatever it's now is going to do a similar thing. It's a massive distraction. I think we need to focus on what the industry delivers as product, the value that we bring to the market, and concentrate on making it the most efficient industry possible. And I mean, the other thing which comes up every year is monetization, monetization, monetization. Well, actually, we monetize perfectly well within the industry. We might not make as much money as we ... Margin as we made in the past, but it's a perfectly profitable industry. The trouble is the temptation is when you see all the drones on stands, you see all the fancy stuff going on, you think, "We should have a share of that pie." And it's generally not accruing to the telco. The telco, the connectivity is a contributing element to it, it's a critical element. It has to be delivered reliably. But I think new monetization in many cases will be done by other parties in the ecosystem. And in some ways, if telcos were to step back and become more wholesale providers, I think they might be happier, because they'd understand the relative role in the value chain rather than trying ... They tried to dominate the value chain, and you can't do that, because they don't have the software skills. They don't have all the right product to deliver. And the caveat, I will add to that, is that within certain countries and certain telcos they do have some of those facilities. They do have reach into the IT world. They do have reach into the media world. So, it's never one-size-fits-all. Obviously, we're not all profitable as the big three U.S. carriers. We're not all as controlled as the big three Chinese carriers. There's some fantastic stuff going on in India with the way that has come from nowhere to be an incredible market. And then you've got many markets which are subscale that really requires some consolidation. The recent changes in attitude from the European Commission to allow more consolidation, I think is the real breath of fresh air, because we don't need as many operators as we've got. We need the connectivity. We don't need all that competition. We need something that makes sure the product gets delivered and we can consume it and embed it into whatever we need to for the economy.

Dave Vellante

>> You've always had real clarity on where the telcos play in the value chain. You've always said this, Chris, and I've learned that from you is, focus on that core connectivity piece. And just reminiscent of a couple of years ago when I think it was the head of, maybe it was Orange or one of the other telcos, might have been Ericsson, saying that, not Ericsson, but Deutsche Telekom, I think, saying that Netflix, the Netflix of the world should contribute and pay up-

Chris Lewis

>> The fair share debate.

Dave Vellante

>> Yeah, yeah. The fair share, and the Netflix CEO retorted, "We're spending so much on content development. Why don't you share some of that? Because we've lifted the usage on your networks," and this back and forth. The point being, they each have their own respective place in the value chain. And it just dawns on me what you were saying about drones and the edge. There's a whole new layer of value that's being created, and it's going to be hard for the traditional telcos to capture that value. That's not their core competency.

Chris Lewis

>> No, at a time when, as you say, they put a lot of CapEx in, they haven't got return on the CapEx. Cash flow is generally pretty good, because we keep paying month after month after month, so the money flows in. But the opening it up. That is a place where to be more open for the telco working with other parties, that's where I think the future lies. And of course, the other factor you have to bear in mind is that Netflix is a global business. Google and Facebook and are global businesses. Telcos are not. They're national or even sub-national business, so they don't have the scale.

Dave Vellante

>> And the other point is, well, you've mentioned it several times, the competition due to regulation. There's also another side of that coin, which is regulatory capture that insulates the profits of these telcos, at least some kind of base level. So, it's actually a pretty good business. It's just when they compare it to a Google or a Netflix and they see the stock valuations of some of these companies, there's a little bit of envy.

Chris Lewis

>> There's no comparison. It's the grass is greener scenario, isn't it?

Dave Vellante

>> Yes.

Chris Lewis

>> I often used to describe it as animals in different fields and the telco's looking over the fence at the grass and going, "Really, that looks great over there. I'll love some of that." But it's different animals. Telco is a different animal to a hyperscaler, to a Netflix. They're just different businesses. And telcos, they dabbled in those businesses. Some of them got into sports rights, some of them got into IT, some into broader media. Now, some of them do make a, depending on, to your point about, I wouldn't call it protectionism, but let's say a bit of self-interest from the governments in places. We're here in Spain. Spain just changed its CEO of Telefonica completely out the blue when Pallete left about a month ago. We don't really know what happened. But the guy that the government has brought in, so the government has appointed the head of Telefonica. You have to, I think the more we get into a sovereignty discussion, the more the political pressure applies. And by the way, politicians aren't shy of using telecoms and broadband as a weapon in their election campaigns, are they? So, politicians love it, but we have to be careful to make sure that it is a sustainable business, long-term business for the good of the country. And the trouble is that may well in some cases require intervention. What the Chinese did 15 years ago, we said, "We've got all these players, we need to rationalize it, have three players. This is how we're going to be organized, deliver the services that way." Now, in the U.S. you've done that through capitalism, that's been done in China through communism. India is, I'm not quite sure what ism it is, but perhaps it's Modi-ism as delivery-

Dave Vellante

>> ....

Chris Lewis

>> in India. And then in Europe, because we lack the scale, we've not really driven it through, apart from Deutsche who obviously have T-Mobile in the U.S. as a great cash engine. I think part of the challenge fundamentally, Dave, is, what business are telcos in. And I think they were lured into thinking they could be in all these adjacent businesses. And the trouble is they all come with their own ecosystem. So, telco's allegedly moving into, so 5G's supposed to be generating a lot of revenue from the B2B sector. But in the B2B sector you've got enormous numbers of system integrators, resellers, VARs and the like who work in those sectors who are well steeped in it. So, my issue is, telcos go through channel. They've never been very good at channel, whereas the Cisco's are great at channel. Everyone else is building channel, because the people, the businesses especially, but the same's true with consumer. You want to go through a channel that you like that you're familiar with. And it's always been that double-edged sword of being telco that we love an AT&T or a BT or a Vodafone, because they are national brands, but we hate them because the service has always been poor. So, the flip of focus away from just being an engineering building, great networks, to actually delivering something which customers appreciate that is high quality product that you don't have to call them all the time with a problem about your bill. It makes me laugh that one of the main AI applications is about bill queries. Well, there shouldn't be bill queries, should they, should get the bill, right? Yeah. So, there's some fundamentals about this industry which are a bit of a mystery to me. And the other big thing here is the whole API discussion. And the problem with the API discussion is that it's quite a fragmented market. You've got the GSMA with its open gateway, you've got all the TM forum with its different APIs, and then everyone does their own API. So, that is a Wild West at the moment, I think in terms of, but the value that it can create does tie it back to the identity of the person who's on the mobile phone. So, there is a security play there, fraud's been addressed by some of that stuff. Location obviously, which we've always talked about location-based services. So, you know where someone is, who someone is, and the services they may be using. There's a lot going on. Yes, we need to keep building the networks and making better and better and better. We need to make sure the customer service is truly customer-focused and not technology-focused. And we need to make sure that we work well with the other players in the ecosystem who frankly are often much closer to the customer than the telco is.

Dave Vellante

>> Savannah, last year we explored with Chris the accessibility angle. Do you want to revisit that?

Savannah Peterson

>> I was literally just going to bring it up. I'm curious, Chris, as someone who is on the accessibility front and trying to navigate the salmon sea that we were talking about earlier, how do you think MWC stacks up in terms of accessibility?

Chris Lewis

>> It's very patchy, but what I would say, and I must congratulate the GSMA, because the people running the IT and stuff, the app is much better this year.

Savannah Peterson

>> Okay.

Chris Lewis

>> Actually, you can get it to tell you how to navigate from place to place and it'll tell you how long you're going to be, so you can find things, which is great. The website and the app is much more accessible, so it creates that thought that it's been built in. So, Trevor Skinner and the team have done a great job pulling that together and making it work. I mean, it's fundamentally not a very accessible event.

Savannah Peterson

>> I was wondering about that.

Chris Lewis

>> Physically it's just so big. So look, I bring someone like Gemma this year who basically moves me from meeting to meeting. I have often no idea where I am. But what is interesting, we are beginning to see it. There's quite a few things around, not just accessibility. There's some stuff around DEI, which has obviously had a bit of a panning in the U.S. recently, but it's still big. We can still build that diversity into the industry. And there's another AI angle, I think I showed you the app last year, called Be My AI, which I use to identify things around me. It even read me the menu at dinner last night. Beautifully read me the menu. Those tools, once again, out on the device it is pinging back to ChatGPT in that case. And we're beginning to see, although, the Olympics in the summer, there was a thing called Touch2See that Orange brought to the Olympics.

Savannah Peterson

>> Oh wow.

Chris Lewis

>> And basically you're sitting in a sports stadium watching a soccer match or a rugby match and you can feel where the ball is on the pitch. It's tracking the chip in the ball and it's translating onto a pad in your hands so you can feel haptic feedback and where the ball is. Very cool. So, creating-

Savannah Peterson

>> That is super cool.

Chris Lewis

>> Creating an immersive experience. I mean, I can't see the screen anymore, but people who see a little bit, they can even take the video feed from the TV and enhance it so you can blow up the individual player or follow the ball or whatever. So there's that, plus all the sound, all the audio description. I mean, I'm also now working with a charity in the UK that does audio description in theaters and museums and the like.

Savannah Peterson

>> Oh, neat.

Chris Lewis

>> And the ability to pick up what's happening on stage and then in between the dialogue describe to people what's going on. It's incredible.

Savannah Peterson

>> Well, that gives you the context that you can't have otherwise. What's a way that, because I feel this and I think about this even with our set all the time, how could someone setting up a booth be more mindful of accessibility?

Chris Lewis

>> Well, honestly, it's pretty straightforward. It's simplicity of design. So, don't be overcomplicated, don't put too many steps in, like we have coming up into the thing here-

Savannah Peterson

>> We have to.

Chris Lewis

>> Which you have to because the cables and the like. But no, and in fact, the universal design principle or inclusive design principle is that in the past we used to design for the center of the market. If I'm going to be politically incorrect, we'll say, "Let's do we design it for a white Anglo-Saxon middle-aged male. So that was the key market. When you come to design something for me as a blind man or someone with a hearing problem or cognitive issues or whatever conditions, they were always peripheral and they were always developed by that sector, by the blind sector or the deaf or whatever. By designing inclusively, by thinking of those design criteria from the very beginning, you've got the center covered. You don't need to design for the center because you've designed all the permutations. Because at some point when you're driving, hopefully you're not looking at your phone, you might listen. So that text, text-to-speech translation is useful for everybody. As is captioning. People use captions all the time, even though they were designed for hearing impaired people. And I suspect as we move into the digital healthcare world a lot of that haptic feedback sensors and the like. And the great news is that things like Metaglas, which I'm not wearing today, I do have a pair in my bag. Metaglas is going to transform it, because you're not going for the many thousand dollar headset, which frankly we wouldn't walk around in way, but a pair of glasses that have cameras, have sensors, can speak back to you. That camera technology is really going to change the world.

Savannah Peterson

>> I love it. I totally agree. And it's always so insightful to hear from you, Chris, we could talk to you all day. I know I speak for Dave and I both-

Dave Vellante

>> Thanks for bringing the knowledge in this space. You've been at it for decades and really know yourself-

Chris Lewis

>> Four decades.... really appreciate it.

Savannah Peterson

>> And thank you for bringing the hot takes too. Who's counting?

Chris Lewis

>> Because I'm right there with you brother.

Savannah Peterson

>> Who's counting, who's counting? But you always bring the hot takes. I love your perspective, Chris, and we're really grateful that you spent-

Chris Lewis

>> Pleasure to be here, thank you guys....

Savannah Peterson

>> your time with us. And thank all of you for tuning in to our four days of live coverage here in Barcelona, Spain. Joined with Dave Vellante, my name's Savannah Peterson. You're watching theCUBE, the leading source for enterprise tech news.