The UK two-way industry: strengths, weaknesses, opportunities and threats
Written by: Sam Fenwick | Published:

The two-way radio industry has survived and flourished, despite the rise of mobile networks and smartphones. But what are its current challenges and opportunities? Sam Fenwick investigates

The UK’s two-way radio industry is a well-established and vital part of its economy, underpinning business- and mission-critical operations in a huge range of sectors. But what challenges does it face? One of the classic tools beloved by managers and consultants is the SWOT (strengths, weaknesses, opportunities and threats) analysis. Of the four areas, the first two focus on internal issues, while the second concentrate on external factors. Let’s examine each of these in turn.


Strengths
One of the two-way radio industry’s inherent advantages is that many of its resellers and systems integrators are adept at providing and supporting two-way radio solutions that have high levels of resilience and availability. Tim Cull, head of business radio at the Federation of Communication Services (FCS), notes that “as time goes by, legal implications are becoming more serious and so growing in importance. Sensible users choose business radio solutions when they consider the imperatives arising from due diligence processes.”

He also highlights the fact that “if you are operating in a high-risk area, not having the right communications can be considered negligent, [with possible] legal implications for the user”.

It is important here to understand just how resilient a system needs to be if lives are at stake. Cull gives the following hypothetical example: “A user organisation makes thousands of calls a week but on average only 10 of these are extremely important (avoidance of injury or death). It requires that the risk of one of these critical calls failing per year is less than 10 per cent. A system that has an end-to-end call success probability of 99.99 per cent confers a five per cent probability of failing a critical call in a year, thereby meeting the organisation’s requirements. However, if the call success probability drops to 99 per cent, the likelihood of a critical call failing sometime in the year rises to more than 99 per cent. In fact, there is a 50-50 chance of a failure on a critical call every week – well above the acceptable levels that have been established.”

Weaknesses
Radiocoms’ Blythe says two-way radio companies are “are having to allow their workforce to diversify and develop new skills. There is potential for a skills shortage and Radiocoms is addressing this through structured training to meet its customers’ needs. Small organisations may not have the ability to allow for this within their business model.”

A related issue and one highlighted in my piece on differentiation strategies for resellers (in our March issue) is the risk created when small resellers heavily rely on one or two highly skilled technical staff rather than having a broad skill base across their business.

It is worth noting of course that incredible technical skills aren’t the only ingredient for success. “As a distributor, we would like some resellers to be more sales-orientated in how they bring their products to market – once our resellers get in front of customers they can be excellent, but we are sure there are many good leads out there which are being neglected,” says Sam Ogles, sales and marketing executive at Syndico. “They don’t need to be completely sales-orientated – a significant component of their business is after-sales service, which is heavily reliant on technical and operational support, but we would like to see more resellers embrace effective sales and marketing techniques. We encourage commercial success for our resellers – what’s good for them is good for all of us!”

Turning from skills to the type of service that is typically offered, Cull says: “While it is true that some solution providers do seek to provide wide-area coverage to their customers, most do not. It is far more common to find on-site communications solutions provided to meet that site’s specialised requirements.

“This is a natural consequence of the type of operations being catered for. However, it does mean that achieving the economies of scale can be difficult, even when the market is global, as in the case of products using digital technologies. Having such a business paradigm inevitably excludes some uses. These include transport logistics and other wide-area users.”

Opportunities
Radiocoms’ Blythe highlights the “early adoption of PoC [PTT over Cellular] technology by individual organisations across different verticals; although not a new technology, the push for it is now far greater than we have seen before. It is a complementary product to a radio system. If you want to expand coverage, or not exclude a user as they have, for example, an iPhone, it becomes inclusive.”

“In our mind, body-worn cameras are the single biggest opportunity at the moment,” says Syndico’s Ogles. “We strongly believe that Hytera bodycams are a ‘PMR’ product, thanks to the value they add to existing communication systems but also their integration with Hytera radios as a remote speaker microphone. They have many USPs which users across the security, utilities, law-enforcement and other sectors could really benefit from. While they aren’t being fully capitalised on yet, we have seen a sharp spike in bodycam interest and sales this year and we expect that to continue to rise for some time.”

Cull highlights the explosion in data consumption by consumers and notes that while operational communications have very different characteristics from those in the consumer world, “there are already clear signs that at least some of the growth in data will occur in business radio. Indeed, several solution providers already report they almost never provide systems that do not have a considerable data component.”

While currently mobile data is mostly delivered by commercial best-effort networks, Cull questions “how much longer will data be generally lower priority than voice?” in the context of business communications. Cull adds that it is far from clear if any data solution currently meets the same demanding levels of resilience that are met by the two-way radio systems that provide critical voice services. “If this remains the case, the challenge would be how to bring such a solution forward in a viable manner. Having said that, were it to be achieved as it has been for digital voice, what a triumph that would be!” He adds that business radio might be able to take advantage of 5G and the short ranges associated with using frequencies in the high GHz bands – “indoor applications might be well-served by such a model”.

However, Cull notes that at present there is no way of judging the potential demand for a resilient operational mobile solution. “However, it is fairly safe to say there will be at least some demand. It may be that the demand is unknowable as a viable solution isn’t clear and so it is not under active consideration among the user community.”

It is worth noting here that the recent announcement by Ofcom that it is working to allow businesses and other interested parties to access spectrum in the 3.8-4.2GHz, 1800MHz and 2300MHz bands through local Shared Access licences might a game-changer in this regard, given that it means businesses may be able to obtain the spectrum necessary to deploy their own infrastructure rather than depending on the commercial networks.

In addition, Andromeda recently announced that it is working to deploy private LTE networks for on-site use with a similar level of resilience to that of a two-way radio network and the ability to work despite a loss of mains power or external network connectivity. John Swarbrick, Andromeda’s founder and CEO, says he expects the push for such systems to come from chief information officers looking to drive better operational efficiency and digitise manual processes for their workforce and provide apps and services to on-site customers and visitors, rather than as a two-way radio replacement. That said, he expects voice and data services to run in parallel “for quite some time, until eventually two-way radio becomes part of private 4G networks”.

One barrier that might need to be overcome if such systems are to be an opportunity for the two-way radio industry is that of skills. “There’s a big question mark around whether two-way radio network [engineers] are skilled enough in significantly complex IP and LTE networking to feel comfortable deploying and supporting those systems. I would say even deploying a small-scale LTE network is significantly more challenging than [deploying] a two-way radio system,” says Swarbrick.

Threats
“For many decades now, some commentators have been predicting the demise of the business radio industry,” says Cull. “The FCS takes the view that the business radio industry provides solutions to users who are most interested in operations rather than entertainment. As such, the industry is not tied to any one technology.”

However, he says the FCS is concerned by some claims around the use of 4G and 5G in applications that might require extremely high levels of resilience – such as remote robotic surgery and the use of 5G in driverless cars.

“While it is not for the FCS to comment on these suggested applications, we are concerned because of the adverse public relations that might arise from any failures in such highly visible arenas, even though it is extremely unlikely that any FCS business radio solution provider would [not] undertake to supply a solution for such an application unless every care had been taken to meet the resilience levels needed to ensure success.”

Blythe warns that there are some companies “that are focused on driving down product value, devaluing the market by not focusing on the value of the application and the service received”. He also highlights the way regulatory pressures and real-world needs are driving the requirement for greater spectrum efficiency. However, Syndico’s Ogles notes PoC’s usefulness in this regard. “Our industry has to embrace the latest technologies which are ultimately going to keep end-users safe and connected,” says Ogles. “So far, every threat we have seen has also produced a resolution – PoC is a great example, which has widened many users’ options as inner-city radio frequencies become harder to come by. Brexit is still casting uncertainty for our resellers, many of whom are business owners in their own right; however, we still haven’t seen signs of business slowing.”

It could be argued that innovation has two mothers – necessity and constraint. Given the need for manufacturers and resellers to differentiate themselves within a market that provides end-users with a seemingly simple push-talk service, it is perhaps no surprise that the two-way radio industry has continually reinvented itself and now offers a huge amount of additional added-value services. Because of this track record of innovation and the extent to which new technologies and opportunities are being pursued, here at Land Mobile we have every confidence that the two-radio industry will continue to be indispensable for many years to come.


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