Blockchain Technology In Telecommunication Industry

5 min readMar 6, 2023

Blockchain technology has the potential to solve big issues in the Telecom industry because it creates transparency through its distributed immutable ledger property.

The telecom industry is looking for new ways to innovate and compete with every emerging technology and blockchain technology can be used as the backbone of IoT interconnections, the telecommunications sector can benefit from new efficiencies, automation, cost savings and improved customer experience.

In this article, the use cases of blockchain technology in the Telecom industry and how it can resolve the major issue of the telecoms industry are being discussed.

To understand the potential of blockchain in Telecom dynamism, let’s master its concept.

Concept of Blockchain

A blockchain is just like traditional databases where our data is stored and organized information in the form of tables or JSON structures. This approach is easy for computers to recognize the information. On the other hand, Blockchain stores data and information in the form of small blocks. Each block has a limited storage capacity of up to 1MB.

The data is stored hashed by the SHA-256 algorithm ( A secure hashing algorithm or commonly referred to as SHA-256, is an unkeyed cryptographic hashing function that takes an input of variable length and produces a 256-bit long hash output ) and the preceding block through a cryptography algorithm. Once the block has reached its storage capacity, it closes and is added to the chain. This creates an immutable timestamp.

All the information stored in the blockchain is distributed and immutable which means data is not controlled by any individual identity. On the contrary, traditional databases are controlled by a central authority. Sensitive data is always controlled by an organization.

Blockchain is inherently very secure and the high level of trust required when sharing information makes it an attractive model for the telecommunications industry, some policies are given below:

1- Secure KYC Process

When customers register for new accounts, they have to go through a cumbersome “Know Your Customer” (KYC) process which involves handing over or uploading sensitive information. Integrating blockchain in existing Telecom networks can remove this hazard as customer identities are no longer stored with a centralized third party but in a decentralized, tamper-proof immutable ledger, with no single point of failure

2- 5G Enablement

5G is a new era of connectivity, that will be able to connect over wider ranges instantly and frictionlessly without suffering from current latency issues. As data needs to be secure and free from all malicious activities. Blockchain will enable 5G to reach its full potential by being that trusted source of data that interlinks all devices.

3- Mobile Number Portability (MNP)

Mobile number portability (MNP) is a service that allows smartphone customers to change telecom carriers and keep the same phone number. MNP is based on a manual process, in which the existing service provider and the new service provider have to undergo certain transfers once a porting request is generated by the user. The challenges faced in the MNP include Slow processing of requests, lack of transparency among the entities involved, and delays during the verification, and moreover, a third party is required to ensure the security of the stored and regulated data. Through blockchain, it can be streamlined and will act as one network where all service providers can review and action requests

4- Voice over Internet Protocol

As the name suggests, the basic function of VoIP is to transmit voice messages over the internet. This enables the transmission of voice in any IP Digital Network.

Blockchain technology can be used to add top-grade encryption to all processes involving the transfer of data. Added authentication can be used, for instance, whenever text, video, images, and/or voice data are sent. Blockchain can also offer optimized call privacy whenever the VoIP provider offers this service. Call privacy can involve various strategies — including substituting or masking numbers. Blockchain’s ability to time stamp features is a third key element that will enable users to find specific transactions. With just one click, companies can discover which transaction was made, and best of all, the entire stamping process is automatic.

5- SLA Monitoring

While many organizations are investing in automation, it’s not unusual to see manual processes causing vendor disputes and delays in settlements due to differences in the interpretation of SLAs. Blockchain-powered Smart Contracts can help limit such disputes by creating ‘one version of the truth and offering transparency with real-time data. SLA data and KPI rules will be managed by smart contracts on the blockchain, and once a service is complete, a smart contract will decide the SLA status as ‘good’ or ‘bad’. Based on the SLA status, the smart contract will then calculate charges or incentives, and payment can be issued accordingly.

Conclusion

Major telecom industries are looking at blockchain in telecommunications, but baked-in applications aren’t here yet. Currently, Blockchain is young enough to evolve into anything we want. There are good arguments that say that there will be a significant impact of blockchain on the telecommunication industry. The big shift is already here!

Reference

AUTHOR:

Syeda Maham Fahim — Blockchain Engineer at Biospiel and Junior Level Undergraduate Telecommunication Engineering Student at NED University.

Disclaimer: The author of the blogs are the students of NED university of engineering and technology. Therefore, all the information and opinions expressed in the blogs are solely from the students. IET, UK have no direct access or contribution in any of the blogs.