Web3 Reshaping the Telecommunications Industry: From Communication Networks to Value Exchange Networks

Under the impact of the digital wave, the traditional business model of the telecommunications industry faces unprecedented challenges. The promotion of 5G technology requires huge investments, but the revenue model has not made breakthroughs, leading to a return to competition in the existing market. Data shows that while the revenue of leading telecommunications companies in the United States is higher than that of internet giants, their profit margins and market values are far inferior to the latter, reflecting investors' lack of confidence in the telecommunications industry.

The telecommunications industry has been seeking transformation. Previous attempts at solutions such as virtual operators and going overseas have not addressed the fundamental issues. Looking back, the global roaming scenario for eSIM is actually very suitable for implementation using Web3, and can enhance value-added services through blockchain. This article will explore the restructuring solutions of blockchain and Web3 operating models for the telecommunications industry, as well as the potential to upgrade communication networks into value exchange networks.

Challenges Faced by Traditional Telecommunications Operators

Traditional telecommunications operators focus on communication infrastructure, generating profits by providing connectivity services, value-added services, and industry digital solutions. Basic communication services remain the primary source of revenue, but traditional voice and SMS revenues have significantly shrunk. Operators enhance user loyalty through bundled sales while developing value-added services such as cloud services and the Internet of Things as new growth points.

In terms of costs, operators face dual pressures of heavy asset investment and refined operations. The construction of 5G base stations has increased capital expenditures, and the industry is adopting methods such as co-construction and sharing, as well as AI energy-saving solutions to reduce costs. The competition in the existing market keeps costs high, prompting operators to shift towards digital direct sales.

The main challenges come from technological iterations and cross-border competition. The decline of traditional business is evident, the return on investment for 5G is long, and there is also the need to face emerging competitors such as satellite broadband and cloud vendors. Operators are transforming from a "traffic pipeline" to a "digital service engine," building ecosystems and focusing on ESG strategies.

The Dilemma of Exploring Overseas

Telecom operators face many obstacles on their way to going overseas:

1. Market access restrictions: Many countries restrict foreign investment shareholding ratios or require localized operations.
2. Different spectrum allocation rules: The 5G frequency bands vary across countries, increasing the cost of cross-border deployment.
3. Strict data localization requirements: restrict cross-border data flows.
4. Local monopoly market structure: difficult to break user inertia
5. Price Wars and Subsidy Culture: Emerging markets rely on low-priced packages, increasing cost pressures.

Operators are attempting to go abroad through models such as equity investment, joint ventures, and virtual operations, but still find it difficult to break free from regional restrictions. In the future, it may present characteristics of "global capability, local delivery," seeking balance in terms of standards, networks, services, and other aspects.

Solutions for Reconstructing the Telecommunications Industry with Web3

The reconstruction of the telecommunications industry by Web3 is not just a simple "blockchain +", but rather an upgrade of the communication network to a fundamental value exchange layer through globalization, token economies, distributed governance, and open protocols. Major transformations include:

1. Infrastructure Layer:

   • Tokenization of physical network resources enables distributed sharing
   • The DAO governance of spectrum resources enhances utilization.
   • Decentralized Identity ( DID ) solution enhances user data sovereignty
   • The blockchain data market allows users to trade data for profit.

2. Cross-border services and settlement:

   • Blockchain reconstructs international roaming settlement, significantly shortening the settlement cycle.
   • The DeFi model introduces a fee system, allowing users to stake for discounts.
   • The combination of edge computing and blockchain gives rise to device autonomous networks.

3. Economic Model:

   • Communication and finance achieve atomic-level integration
   • Users can earn profits by sharing resources, forming a "consumption-production" closed loop.
   • Derivative innovative services of DeFi mechanisms, such as communication insurance, cross-chain roaming, etc.

Case: Web3 Decentralized Telecom Operator Roam

Roam is committed to building a global open wireless network to ensure free, seamless, and secure network connections for humans and devices. Leveraging the advantages of blockchain, Roam has established a decentralized communication network and integrated eSIM services. Currently, it has over 1.7 million nodes and more than 2.3 million users across 190 countries, with 500,000 network verifications daily.

Roam combines OpenRoaming™ technology with Web3's DID+VC technology to build a decentralized communication network, reducing construction costs and achieving seamless login and end-to-end encryption. Users can receive incentives by sharing Wi-Fi nodes, enjoying seamless global connectivity. Roam eSIM covers over 160 countries, providing users with flexible network solutions.

Through Wi-Fi + eSIM global free access and a diversified incentive mechanism, Roam promotes the rapid development of decentralized networks, creating stable income channels for users.

Communication-Based Value Exchange Network

The reconstruction of the telecommunications industry by blockchain and Web3 essentially upgrades communication networks into value exchange networks, achieving the integration of "information + value + trust". From a historical perspective, the evolution of communication technology has profoundly restructured the financial payment system, mainly reflected in:

1. Information transmission efficiency: Deconstructing the barriers of time and space value transmission
2. Connecting Boundary Expansion: Building the Nerve Endings of Inclusive Finance
3. Trust Mechanism Reconstruction: Achieving "Trustworthy without Trust"

The blockchain-based "on-chain bank" can already achieve various functions of traditional banks. In the future, it may give rise to new forms such as a global instant settlement network and AI autonomous financial entities.

Conclusion

The telecommunications industry is undergoing transformation. In the future, a hybrid model of "centralized infrastructure + decentralized services" may emerge: basic telecommunications operators will continue to manage the physical layer infrastructure but will open APIs for DePIN projects to call upon; service operators like Roam will reconstruct themselves as the central hub of global value routing based on telecommunications networks and blockchain technology. Users also need to shift from passive consumers to ecological co-builders, promoting the development of the Web3 communication ecosystem.

Decentralized telecom operators like Roam in Web3 are expected to become the digital foundation of the Network State utopia, building a new communication value network.