Telecoms operators are rapidly embracing generative AI (GenAI), with recorded implementations nearly quadrupling between May and August 2024. The latest update from our ‘Telco generative AI adoption tracker’ highlights the swift pace of adoption and the growing focus on monetising GenAI.
A rapid rise in GenAI adoption
The latest quarterly update of the ‘Telco generative AI adoption tracker’ reveals a substantial increase in the implementation of GenAI technologies by telecoms operators worldwide. The number of recorded GenAI implementations nearly increased fourfold from 56 in May to 201 in August. Additionally, the number of operators actively pursuing or deploying GenAI nearly doubled, rising to 54 operators, up from 30 in May.
Distribution of generative AI implementation by telcos (August 2024)
Source: STL Partners
This increase in adoption reflects the growing recognition of GenAI’s potential within the telecoms sector. Operators are not only experimenting with the technology but increasingly launching concrete use cases. In fact, the number of actual launches has risen significantly, with half of the recorded implementations by August being live deployments, compared to only a fifth in May. This momentum underscores the sector’s commitment to harnessing the transformative power of GenAI, as telcos aim to optimise operations, enhance customer experiences and tap into new revenue streams.
Diverse applications of GenAI in telecoms
The tracker also provides insights into the wide range of GenAI applications within the telecoms industry and highlights that customer service remains one of the primary areas where the technology is being implemented by telcos. AI-driven tools, such as Vodafone’s ‘SuperTOBi’ chatbot, are becoming more sophisticated, enabling telcos to offer personalised and efficient support experiences. These solutions handle complex customer queries and provide more tailored interactions, elevating the customer experience.
GenAI can enhance network operations in various ways, such as optimising setups, increasing labour productivity, extracting customer insights and more efficient planning. For instance, Deutsche Telekom is leveraging GenAI with its ‘fibre-to-the-home roll-out chatbot’. This tool assists contractors in complying with regulations and helps to improve the fibre broadband installation process.
Additionally, many telcos are embarking on larger projects that integrate GenAI across various business areas. By doing so, they aim to achieve greater efficiency, streamline processes and foster innovation throughout their operations. These projects often address complex challenges that require coordination across different departments, such as customer service, human resources (HR), marketing and finance. By integrating GenAI into various areas, operators can develop cohesive, scalable solutions that not only improve specific functions but also boost overall business growth and competitiveness.
Monetisation opportunities
One of the most significant trends identified in the report is the growing focus on monetising GenAI, particularly within the enterprise sector. The share of AI-as-a-service implementations has risen sharply, from 25% in May to 45% in August. This indicates that telecoms operators are increasingly positioning themselves as key partners for enterprises looking to leverage AI technologies.
AI-as-a-service share of telco implementations
Source: STL Partners
Many operators are developing AI-as-a-service offerings tailored to the needs of enterprise customers. These services include proprietary large language models (LLMs) for telecoms and other industries, generative AI solutions for businesses and AI infrastructure designed to serve the enterprise market. As companies across various sectors seek to integrate GenAI into their operations, telecoms operators have a significant opportunity to tap into new revenue streams and strengthen relationships with business customers
Early days – but rapid progress
Despite the impressive growth in GenAI implementations, the telecoms industry is still in the early stages of fully realising the technology’s potential. While deployments are increasing rapidly, many telcos remain in the experimental phase, exploring how best to integrate AI across more complex areas of their operations beyond the initial low-hanging fruit, such as customer service.
Another trend we have observed, which is expected to gain momentum in the future, is the growing share of implementations that utilise multiple LLMssing a platform that supports multiple LLMs benefits telecoms by offering flexibility, improved performance, customisation, scalability and innovation, allowing them to efficiently adapt GenAI models to various tasks and challenges.
Obstacles persist, including the need for robust data management, the development of AI expertise within telecom organisations and the ongoing evolution of AI technologies. However, the progress made over the past few months suggests that the industry is on a fast track toward widespread GenAI adoption. As telcos continue to invest, refine their strategies, and address more complex use cases, they anticipate that GenAI could be transformative for the sector, potentially driving significant growth — though this remains to be proven.
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