Telecommunications Providers Embrace Cloud and AI for Enhanced Network Performance
In a rapidly evolving digital landscape, telecommunications companies are increasingly turning to cloud computing and Artificial Intelligence (AI) to enhance their network performance. According to a recent global study conducted by the IBM Institute for Business Value, with assistance from GSMA Intelligence, those communication service providers (CSPs) who have embraced these technologies are experiencing significant improvements in performance, scalability, cost efficiency, and new monetization opportunities.
The comprehensive study, titled “Rewiring the Telecom Mindset: How CSPs are Gaining Network Advantage with Cloud and AI,” offers insights from 750 network executives worldwide. These leaders, representing renowned providers like Bharti Airtel, Deutsche Telekom, Telstra, Verizon, and Vodafone, highlight the necessity of adopting a cloud and AI-driven approach to remain competitive and deliver superior network services.
Key Highlights from the Study
The research outlines several pivotal findings that underscore the transformative impact of cloud and AI technologies on the telecommunications industry:
1. **Network Performance Takes Precedence:** A significant 79% of telecommunications executives surveyed prioritize network performance above other considerations. Network modernization follows closely as the second most important priority.
2. **AI Adoption Rises Among Innovators:** Among those identified as pioneering technology innovators, 62% utilize traditional AI for network planning, in contrast to a 40% uptake among their peers. Furthermore, 54% of these innovators incorporate generative AI into network planning, a figure that is double that of their counterparts. This highlights how cloud readiness can drive agility, enabling advanced AI-driven capabilities.
3. **Security Concerns Amidst Breaches:** Despite 55% of respondents reporting a network security breach in the past year, only 42% of executives view network security as a top challenge for the next three years. This indicates a potential gap in prioritizing security measures.
4. **Projected Growth in Cloud and AI Investments:** Executives anticipate increasing their network investments over the next three years, with cloud implementation expected to rise by nearly 20%, traditional AI by 16%, and generative AI by almost 19%.
Beyond Technology: A Cultural Shift for CSPs
The study emphasizes that for CSPs to fully capitalize on the benefits of cloud and AI, they must foster a cultural transformation. This involves embracing calculated risks, promoting collaboration, learning from failures, and nurturing innovation. By doing so, CSPs can enhance their competitive edge and unlock new revenue streams.
“Telecommunications companies that leverage a cloud and AI-driven approach are better prepared to navigate the complexities of modern networks and seize emerging opportunities,” explained Rahul Kumar, Senior Partner & Vice President, Global Industry Leader for Telco & Media Industry at IBM. “By adopting a mindset receptive to innovation, CSPs can achieve substantial advantages and maintain their competitive edge.”
Peter Jarich, Head of GSMA Intelligence, added, “The study’s findings highlight the crucial role that cloud and AI will play in shaping the future of telecommunications. As the industry continues to evolve, CSPs must prioritize network modernization, enhance security, and foster innovation to remain competitive and drive growth.”
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Study Methodology
The IBM Institute for Business Value conducted the study in collaboration with Oxford Economics. They surveyed 750 telecommunications industry executives across 25 countries, covering roles such as Chief Technology Officers, Chief Networks Officers, and leaders responsible for various aspects of network management and monetization. The analysis involved a two-step cluster method based on respondents’ assessments of cloud computing’s impact on network features and their AI technology adoption.
The clustering variables included eight network performance indicators, rated on a scale from -100% to +10,000%, covering network performance, security, scalability, flexibility, reliability, availability, maintenance costs, and deployment time. Additionally, the study considered the number of use cases where organizations deployed both traditional AI (including machine learning) and generative AI across 17 network management areas, from network planning to field service operations. This approach identified a leading segment achieving superior benefits from cloud computing and broader AI implementation across network operations.
Furthermore, 14 executives from leading telecom companies participated in one-on-one interviews to validate and explore the survey results in greater depth.
About IBM Institute for Business Value
IBM’s think tank, the IBM Institute for Business Value, combines global research and performance data with insights from industry experts and leading academics. The institute delivers valuable insights to help business leaders make informed decisions. For more thought leadership from IBM, visit www.ibm.com/ibv.
About GSMA Intelligence
GSMA Intelligence is a leading source of global mobile operator data, analysis, and forecasts, publishing authoritative industry reports and research. It provides a comprehensive set of industry metrics, updated daily, supporting strategic decision-making and long-term investment planning. For more information, visit www.gsmaintelligence.com.
About IBM
IBM is a global leader in hybrid cloud, AI, and consulting services, helping clients in over 175 countries leverage data insights to streamline business processes, reduce costs, and gain a competitive edge. With innovations in AI, quantum computing, industry-specific cloud solutions, and consulting, IBM offers open and flexible options to clients. This is all supported by IBM’s commitment to trust, transparency, responsibility, inclusivity, and service. For more information, visit www.ibm.com.
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