The telecom industry’s current revenue streams provide slim to nonexistent margins, and telcos have been under constant pressure to improve them – but how?
Just one example of a dramatic decline in income comes from roaming charges brought about by the commoditization of connection services, including virtual private networks (VPNs) and internet-based services. This is just the tip of the iceberg, and a dramatic shift in monetization positioning is needed to meet these revenue challenges.
With this, the road ahead demands optimization: trimming infrastructure costs, enhancing efficiency, and ensuring smoother user journeys while also transforming raw data into actionable intelligence, offering personalized services and insights for users.
While developing new revenue avenues is crucial, there’s been hesitancy in transitioning from traditional 5G networks to standalone ones, which can enable new revenue streams, hindering progress. In short, moving to a 5G standalone network has many benefits – it provides a seamless and optimized 5G experience without any reliance on legacy 4G components. From there, this more “freed’ approach can offer up new consumer experiences like improved business offerings, augmented reality, virtual reality, cloud gaming, and more.
Setting the future up with the right network approach
So, how do communication providers make this shift? Embracing Application Programming Interface (API) exposure could be the game-changer required. API exposure can easily be explained as making a software system more accessible to external users, allowing better connections, innovative services, and more.
With this, here are some of the main benefits that can be had:
- Opening New Doors with APIs: Network and mobile operators can leverage API formats to showcase and monetize their backend solutions or capabilities via their marketplace.
- Partnering for Profit: APIs also enable telcos to integrate with the marketplaces of their natural partners, such as hyperscalers, to generate revenue from cloud/edge services, third-party applications, and network functions.
- Insights Drive Revenue: Emphasizing the importance of observability and data insights (KPIs), APIs highlight how connectivity, services, and data analytics can amplify monetization opportunities for telcos.
- Simplified Collaboration: Leveraging initiatives like GSMA and Camara APIs, operators can streamline collaboration with partners (CSPs, hyperscalers, third parties) using standardized APIs, reducing complexities and enhancing cooperation for B2B and B2B2x contexts. This approach holds promise for service providers and the broader telecom and technology sectors. However, uncertainties remain about the prerequisites for success and the specific business outcomes to expect.
Where do cloud and AI play a role?
For an API approach to function properly, there are other technologies that should also be kept in mind. For instance, a cloud-native environment serves as a common ground for building and running applications and service functions, providing consistency across operational and business footprints. Hyperscalers have efficiently utilized cloud-native principles to offer a pay-as-you-grow platform, demonstrating elasticity, innovation, and integration capabilities.
Further, Artificial Intelligence (AI) is also reshaping the telecom landscape. Telcos and hyperscalers are increasingly turning to AI for AIOps and NetOps automation, network optimization, and data analytics to improve efficiency, response times, and customer experiences. Moving forward, this will be critical to provide the right experience for consumers, but also to improve business operations.
Looking Ahead: The Roadmap for Telecom Innovation
As the telecom landscape continues to evolve, it’s crucial to outline a roadmap for innovation tied to API exposure. This roadmap should prioritize investments in emerging services embracing wireline-wireless convergence, AI-induced capabilities, cloud/edge computing, and observability. Additionally, fostering a culture of collaboration and knowledge-sharing within the industry will be instrumental in driving sustainable growth and staying ahead of the curve.
Further, regulatory frameworks need to adapt to the changing dynamics of the telecom industry, ensuring a level playing field for all stakeholders while fostering innovation and competition.
The future of telecom lies in embracing digital transformation, leveraging advanced technologies, and fostering strategic partnerships. By doing so, telcos can unlock new revenue streams, enhance customer experiences, and position themselves as leaders in the digital era.
