AI Revolution: Telcos to Splurge $20B by 2028

Telecom Companies to Increase AI Spending for Network Orchestration

Telecommunication companies are gearing up to significantly boost their investment in artificial intelligence (AI) for automating network management. According to a recent report from Juniper Research, spending in this area is expected to reach a whopping $20 billion by 2028. This projection marks a remarkable 240 percent surge from the estimated $6 billion expenditure in 2024.

Driving Forces Behind Increased Investment

The surge in investment is driven by several factors, notably the global expansion of 5G networks and the development of future 6G networks. AI software is anticipated to play a crucial role in optimizing network performance and security, with these two areas expected to absorb over 50 percent of operator spending on AI by 2028.

Meeting the Demands of Emerging Technologies

As enterprises increasingly rely on cellular connectivity for various applications such as smart factories and self-driving vehicles, the need for AI orchestration becomes paramount. The report argues that AI will be instrumental in helping telcos maximize efficiency, cut costs, and deliver superior quality of service.

Streamlining Operations for Enhanced Performance

Automation of tasks such as real-time network analysis and swift adjustments to fluctuating demands can lead to significant savings in network operations and provisioning costs. This proactive approach enables telcos to stay agile and responsive to evolving customer needs.

Importance of AI for Network Quality

Frederick Savage, the author of the report, emphasizes the critical role of AI in maintaining network quality: “As operators compete on the quality of their networks, AI will be essential to maximizing the value of using a cellular network for connectivity. High-spending users will gravitate to those networks that can provide the best service conditions.”

Consequences of Failing to Embrace AI

Telcos that neglect to integrate AI into their network management strategies may find themselves struggling to meet customer demands for performance and security. In an increasingly competitive landscape, staying ahead of the curve is crucial for retaining and attracting customers.

Conclusion

The forecasted surge in AI spending underscores the pivotal role of AI in the telecommunications industry’s future. As telcos gear up to navigate the complexities of 5G and beyond, embracing AI-driven network orchestration is no longer an option but a necessity.

For more insights, the full report can be accessed here.

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