Automated Retail Warehouse AGV Robots with Infographics Delivering Cardboard Boxes

How quantum computing can help untangle TMT supply chains

The emerging technology may be powerful enough to mitigate the subsector complexities complicating supply chain management in the industry.

In brief
  • The supply networks of technology, media and entertainment, and telecommunications (TMT) companies have varying challenges dictated by subsector.
  • These nuances complicate efforts to meet the business imperative of managing supply chain operations effectively. 
  • Quantum computing has the potential to help TMT companies work through these complexities and can revolutionize supply chain management.

Supply chains within the technology, media and entertainment, and telecommunications (TMT) sector are very nuanced and form a distinctive ecosystem. With TMT subsectors operating in a diverse supplier network and widespread asset base, the need for optimized supply chain and operations management is paramount.

The TMT industry operates in a state of perpetual innovation, where products have short lifecycles due to rapid technological advances. This inherent dynamism, coupled with pronounced demand volatility, necessitates a supply chain that is agile and quick to adapt.


But with the complexities of TMT supply chains, and the limitations of current technology, boosting this flexibility presents major challenges.


Given its global reach, the TMT industry’s supply networks are geographically dispersed, creating dependencies that require careful management. Exacerbating these conditions are macroeconomic and external challenges such as geographical dependencies, escalating tariffs and component shortages. The impact on TMT’s intricate web of supply chains is profound, leaving no subsector unscathed.


TMT supply chains will only grow more complex, requiring an advanced solution for optimized supply chain and operations management. Quantum computing might just be the missing link.

Telecommunication tower with 5G cellular network antenna on night city background


Supply networks characterized by complexities

The dynamics of TMT subsectors complicate management of their corresponding supply chains.

Although subsectors within TMT all have supply chains with some similarities, they each have their own nuances and challenges.

“Each TMT subsector presents a labyrinth of unique supply chain complexities,” said Ken Englund, EY Americas Industry Markets Leader, TMT. “When it comes to future-proofing TMT supply chains, there is no universal solution. Our approach must be as diverse as the subsectors themselves.”

Technology subsectors, including semiconductors, technology and consumer electronics (CE) original equipment manufacturers (OEMs)

The semiconductor manufacturing landscape encompasses various stages, from IP design to front-end manufacturing, packaging and testing, each often involving different companies in different global regions. For example, nearly 98% of sub-5nm chip production capacity resides in Taiwan and South Korea,¹ while Ukrainian companies supply up to 54% of the world’s semiconductor-grade neon.²


Semiconductor manufacturing is a precision-intensive, multifaceted process involving machinery such as lithography and etching, often requiring strict temperature control. The maintenance of facilities and equipment is crucial to prevent production errors.


Technology and CE OEMs’ manufacturing relies on diverse raw material components and extensive contract manufacturing, featuring a tiered supplier base. Managing this vast network poses challenges, with 42% of CE companies grappling with sourcing issues.³ Moreover, their sales channels span online, proprietary retail and third-party outlets, introducing distribution and inventory complexities. In addition, their sales models include business-to-business, business-to-consumer and direct-to-consumer (DTC) channels that often introduce several challenges in capacity and inventory allocation and fulfillment complexity.


These CE companies encounter demand volatility, driven by swift technological advances that lead to shorter product lifecycles. In fact, the consumer smartphone replacement cycle has declined from three years in 2017 to 2.6 years in 2023.⁴


Media and entertainment subsectors, including cruises, theme parks, over-the-top and broadcast

In the cruise industry, procurement delays affect new vessel launches, which can lead to cruise cancellations. Further, operational hurdles, including limited just-in-time replenishment, and rising costs due to inflation are impacting the sector.


Other significant challenges the cruise industry’s supply chain faces include logistics management stemming from the industry’s need to consistently supply a wide range of items across various international ports. This complexity is heightened by fluctuating passenger demand and seasonal variations.


Additionally, the industry must adhere to stringent environmental and safety regulations, which impact sourcing and waste management. Economic and geopolitical factors also influence supply routes and fuel prices, adding to the operational complexity and cost concerns in the cruise industry’s supply chain management.


The theme park industry also faces several supply chain challenges, primarily due to its unique and diverse requirements. First, there is a constant need for reliable and timely delivery of various items, ranging from ride components and maintenance parts to merchandise and food supplies. This necessitates intricate logistics and inventory management.


The industry is also significantly affected by seasonal fluctuations, leading to variable demand that complicates inventory planning and workforce management. In addition, sourcing specialized ride equipment and ensuring compliance with stringent safety standards can be challenging and costly.


Additionally, global supply chain disruptions, like those caused by pandemics or geopolitical events, can lead to delays and increased operational costs. Lastly, the drive toward sustainability in operations adds another layer of complexity, as parks seek eco-friendly and ethical sourcing options.


In the over-the-top (OTT), broadcast, and other media and entertainment subsectors with supply chains that require adaptability and responsiveness to variables such as end-consumer demand, maintaining 24-7 availability for customers is paramount. Consequently, the critical focus lies in maintaining back-end equipment, including uplink and downlink equipment, and servers, as these components are instrumental in service delivery. Maintenance assumes a critical role in these operations.


Telecommunications and network equipment

The ubiquity of telecommunications equipment, including its deployment in remote and geographically diverse areas, underscores the critical importance of ensuring uninterrupted uptime and connectivity. Predictive maintenance practices play a key part in achieving this.


Only 5% of existing remote monitoring solutions have yielded the expected results, necessitating a concerted effort toward improvement in this domain.⁵


And with only three to five major suppliers collectively controlling 70% of the spending on network equipment,⁶ the geographical dispersion caused by the concentration of suppliers is only compounding the subsector’s increasing complexity. As a result, navigating uncertainties requires telecommunications companies to establish a robust risk management framework and maintain rigorous control over the supplier network. This underscores the importance of developing strategic supplier relationships even further.


In the realm of consumer-facing operations, telecommunications and internet service providers face the challenge of efficiently managing their field workforce to optimize customer ticket resolution.


While all three subsectors’ challenges have persisted for years, the complexity of TMT supply chains is poised to escalate further. Additionally, the need for cost efficiency to maintain competitiveness remains ever pressing.

“We have made promising digital strides but must acknowledge that current technologies aren’t yet sophisticated enough to completely unravel TMT supply chains’ intricate knots,” Englund said.

Hence, accelerated, advanced and innovative solutions are necessary to surmount these challenges and build supply chain resilience.

Asian woman checking in at subway station via smartwatch


The emergence of a game changer

Quantum computing holds enough power to help TMT companies manage their ever-complex supply chains.

In the simplest terms, quantum computing uses the properties of quantum physics in combination with information technology to solve complex problems. Quantum computing uses qubits, which can represent a 0, 1 or both at the same time, in contrast to classical computing, where bits are used (i.e., a 0 or a 1). 

Earlier this year, EY teams conducted an in-depth exploration of quantum computing and its multifaceted applications within the context of various supply chain functions.

Moreover, quantum computing represents a paradigm shift in computational power, offering unparalleled potential to enhance the entire spectrum of supply chain management practices. From inventory management to demand forecasting, supplier selection, risk mitigation, route optimization, warehouse management, sustainability initiatives, network design and real-time visibility enhancements, quantum computing is poised to revolutionize the way supply chains operate.

With the power of quantum computing, TMT companies can practice continuous vigilance and management over their supply chains while managing the complexities stemming from extensive supplier networks, geographic diversity, multitudes of sales channels, and the intricate nature of operations and production.

“Quantum computing is very much an emerging technology, and companies are actively exploring this technology to solve supply chain optimization challenges,” said Dhaval Desai, Principal Group Supply Chain Engineering Manager, Microsoft. “The scope of supply chain optimization keeps increasing, and organizations want the results faster than ever to make informed decisions to meet consumer needs.”

Quantum computing can help TMT companies carry out two practices that are key in addressing the multifaceted challenges of this dynamic industry: supply chain network planning and optimization, and predictive maintenance.

Automated logistics center with Robotized order picking


Supply chain network planning and optimization

The strategic configuration of the supply chain network can help TMT companies boost efficiencies.

Navigating the intricate landscape of TMT industry supply chains is a formidable endeavor, profoundly influenced by the interplay of geopolitics, fluctuating end-market demand, supplier concentration and, in some instances, the monopolistic control of critical raw materials or technology by specific suppliers or regions. For example:


  • In semiconductor manufacturing, processes encompassing IP design, front-end and back-end manufacturing, and packaging are dispersed across different countries/regions, necessitating intricate international coordination.
  • In the CE arena, sales are distributed across multiple channels, including online platforms, proprietary stores and third-party retail outlets, underscoring the need for a comprehensive and agile distribution network, efficient warehousing and real-time inventory visibility. Additionally, the vast network of suppliers and contract manufacturers demands precise synchronization with a wide array of suppliers for timely delivery and seamless manufacturing.
  • For companies operating in the TV broadcast, telecom, internet service provider and cable multichannel video programming distributor (MVPD) subsectors, where direct-to-home services are provided, the efficient handling of service requests requires the management of a field workforce.
  • Industries such as cruises and theme parks grapple with procurement challenges that can lead to improper merchandise inventory replenishment.

These industry dynamics are compelling supply chain managers to accord due diligence to every facet within their network. This requires the establishment of a seamless data flow mechanism that traverses the various stages of the supply chain. The foundation of this approach lies in comprehensive data collection, wherein meticulous data acquisition and analysis are pivotal.


Consequently, the operative principle guiding decision-making in this environment necessitates a resolute commitment to data-driven strategies, ensuring that every course of action is underpinned by empirical insights and analytical rigor.

Quantum graphic

Telecommunication tower with 5G cellular network antenna on night city background


Predictive maintenance

Emerging quantum technologies can surmount computing challenges to help prevent product failures.

In the TMT industry, which encompasses intricate precision manufacturing, complex telecom networks and pivotal data center operations, the significance of predictive maintenance cannot be overstated. This practice can help TMT companies work through a variety of challenges:

  • Precision manufacturing tools, which are vital for semiconductor and CE production, mandate uninterrupted uptime to stave off financial losses and production bottlenecks.
  • Similarly, data centers, the backbone of contemporary TMT operations, lean heavily on predictive maintenance to sidestep catastrophic downtimes, fortify data integrity and safeguard revenue streams.
  • Meanwhile, the telecom sector grapples with heightened network complexity and hinges upon seamless connectivity. Predictive maintenance, with its reliance on data-driven insights, is emerging as a critical safeguard, helping companies pre-emptively avert unforeseen disruptions and optimize maintenance schedules.
  • In the sphere of entertainment systems, spanning theme parks, broadcasters, cruise ships and streaming services — where intricate equipment is paramount — predictive maintenance preserves quality, safety and customer satisfaction.

However, the journey toward predictive maintenance in TMT is not without its challenges.

The amalgamation of data from diverse sources — including sensors, equipment and network components — poses a formidable hurdle in terms of integration and quality assurance. Further, implementing advanced analytics and machine learning algorithms demands not only significant investments but also a specialized workforce comprising data scientists and engineers.

Nevertheless, quantum computing paired with machine learning is set to revolutionize predictive maintenance and analytics by overcoming computational limitations.

“Quantum computing can be used in taking large manufacturing data sets on operational failures and translating them to combinatoric challenges that, when paired with a quantum-inspired algorithm, can identify which part of a complex manufacturing process contributed to incidents of product failure,” Desai said. “For products such as microchips, where this production process can have thousands of steps, quantum can help reduce costly failures.”

There are several emerging quantum technologies and developments that hold the potential to further advance predictive maintenance capabilities in various industries, including the TMT sector. These developments include:

  • Quantum machine learning: Quantum machine learning algorithms are being researched to enhance predictive maintenance. It aims to improve the accuracy and efficiency of predictive maintenance models.
  • Quantum sensors: Quantum sensors, which can measure physical quantities with extremely high precision, are under development. These sensors can provide more accurate and reliable data for predictive maintenance, especially in situations where sensor accuracy is critical.
  • Quantum annealing: Quantum annealers are designed for optimization problems. They are being explored for applications in predictive maintenance, especially for solving complex scheduling and resource allocation problems efficiently.
  • Quantum software ecosystem: The availability of quantum software development kits, open-source projects and quantum development environments is expanding. These tools make it easier for researchers and engineers to experiment with quantum algorithms and integrate them into predictive maintenance workflows.
  • Quantum cloud services: Cloud service providers are offering access to quantum computers through the cloud. This allows organizations to experiment with quantum algorithms and develop predictive maintenance solutions without having to invest in dedicated quantum hardware.

In a nutshell, quantum computing can help enhance predictive maintenance practices in the TMT industry through:

  • Machine learning algorithms that can optimize predictive maintenance models, leading to more accurate predictions of equipment failures or maintenance needs.
  • Simulation and modeling the behavior of complex systems and equipment more accurately for a better understanding of how factors such as temperature, humidity and usage patterns affect the health and performance of technology assets.
  • Parallelized optimization to explore various combinations and find the most cost-effective and efficient maintenance plans.

However, “while quantum computing holds great potential for supply chain optimization and predictive maintenance in the TMT sector, its practical application is currently limited by a range of challenges and constraints, including hardware cost considerations, algorithm maturity, expertise gaps and data challenges,” Desai said. “As quantum technology continues to evolve, addressing these challenges will be essential for wider adoption and successful implementation.”

e-ticketing man hand using smart phone mobile app barcode scanner


Conclusion and the way ahead

Companies eyeing quantum computing should plan ahead and learn more about the tech as it advances.

With the recent advances in the availability and improved stability of quantum platforms and their ecosystem, companies should explore this technology and start the adoption journey. It is crucial for organizations to build internal quantum expertise to successfully adopt the technology.

A starting point to this journey could be to collaborate with platform and solution providers and team up with universities and research institutions to develop the relevant expertise and stay updated on the technology’s advances.

As companies look to quantum computing to solve their optimization problems, they should consider the following guiding principles:

Contributor: Dhaval Desai, Principal Group Engineering Manager/Senior Director, Microsoft


Disruptions, challenges and opportunities continue to grow in TMT supply chains. Downtime, operational failures and quality failures can significantly impact an organization’s financial position and reputation in the industry. 

“For organizations that are looking for a competitive advantage, the time is ripe for identifying the use cases and starting the experimentation journey” toward quantum-based solutions, said Dhaval Desai, Principal Group Supply Chain Engineering Manager, Microsoft.

Related articles

5 levers to drive supply chain resilience in the telecom industry

Supply chain leaders have the tools to address telecom disruption and promote operational resilience and excellence. Learn more.

21 Aug 2023 Puneet Arora + 3

How global supply chain strategy is changing and what comes next

A multitude of challenges are reshaping the way COOs think about their supply chains, with resiliency and cost transformation leading the way. Learn more.

01 Aug 2023 Sumit Dutta

How supply chains benefit from using generative AI

What was once unimaginable is now possible with generative AI in real-life scenarios throughout the entire supply chain. Learn more.

27 Jul 2023 Sumit Dutta + 1