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Press Release Category: Internal

Edge AI revenue will reach USD157bn by 2030 globally, STL Partners predicts in brand new forecast  

  • Global addressable edge AI market is set to grow by a CAGR of 19% in the next six years, reaching USD157bn in revenue by 2030 
  • Manufacturing stands out as the vertical that will most strongly adopt edge AI use cases, followed by the retail and the transport sectors 
  • Computer vision will dominate, capturing more than half of the revenue by the decade-end 
  • On-premises edge is expected to be the preferred deployment location for any type of use cases, winning enterprises with assurances around security and low latency 

LONDON – 29 January 2025 – The addressable edge AI market is set for significant growth by the end of the decade, rising from USD54bn in revenue in 2024 to USD157bn by 2030 globally, STL Partners prognoses in its latest research. 

In its first-ever Edge AI market forecast, the analyst powerhouse suggests that the market will be rising by a compound annual growth rate (CAGR) of 19% during the period, demonstrating the huge demand for solutions that support future developments of AI applications. 

Edge AI refers to the deployment of AI models at the edge of the network. STL Partners forecasts the value of edge AI across the entire value chain which it splits into six main components: device, connectivity, platform, application, integration and support, and edge infrastructure. The forecast does not include on-device edge AI and focuses on AI workloads processed on edge infrastructure that is off the device.  

The research and consulting firm believes that the proportion of revenue directly attributable to AI will grow from 69% in 2024 to 72% in 2030. This is because applications are set to become increasingly infused with AI, making the technology integral to the delivery of use cases. The remaining 28% of revenue in 2030 is set to come from components of the value chain that indirectly enable AI applications. 

“The substantial value generated directly by AI or as a direct enabling force indicates that players which are specialising in accommodating AI applications at the edge stand to gain significant value. Indicative of this influence is the growing investment across enterprises into AI accelerators to facilitate the deployment of edge AI applications”, comments George Glanville, research analyst at STL Partners and author of the forecast. According to him, convincing enterprises to make this investment into specialised on-premises hardware has required greater collaboration between independent software vendors (ISVs) and original equipment manufacturers (OEMs) to demonstrate the ROI of edge AI solutions. 

Total edge AI addressable revenue (2023–2030) 

Manufacturing, retail and transport are expected to show the biggest demand for edge AI use cases, representing a combined revenue share of 77% by 2030. In fact, manufacturing alone is forecast to encompass more than 35% of the market during the period. This is driven by the sector’s strong – and early – adoption of computer vision use cases, such as asset monitoring and security. 

According to the research firm, the application of these use cases by the manufacturing sector provides a more immediate return on investment than in other verticals, and environments are comparatively easier to deploy in. Furthermore, these are the driving factors behind the company’s expectations for computer vision use cases to dominate the market, representing more than half of the edge AI addressable market by the decade-end. 

 “The overwhelming majority of computer vision use cases will be deployed at the on-premises edge as it provides a secure, low-latency environment for enterprises to perform AI inference on video data, which often contains sensitive information that cannot leave an enterprise’s premises for regulatory reasons”, the analyst explains. 

In addition, he argues, deploying on-premises avoids “the significant cost” of data backhaul that enterprises would otherwise contend with when deploying in more centralised environments. 

Another finding highlights East Asia & Pacific, Europe & Central Asia and North America as the regions with the largest opportunities for edge AI throughout the forecast period. Their collective share of the edge AI addressable market stood at 92% in 2024. This substantial figure is set to reduce by 2030, reaching 86%, as regions including South Asia, Latin America and the Middle East mature in their adoption of edge AI. 

The forecast also provides insights into the segment types of the value chain that are prognosed to capture the lion’s pie in revenue by 2030 and a break down a breakdown of top-performing value chain segments, among other valuable takeaways. 

You can discover more findings from the forecast by downloading an extract here

For media enquiries, click here to get in touch with our team.

More than half of developers do not link telcos with network APIs, finds latest STL Partners survey 

  • A total of 55% of software developers don’t associate the term ‘network APIs’ with telco network capabilities 
  • Despite this, the majority of the developer community is aware of industry-driven API initiatives, such as GSMA Open Gateway and CAMARA 
  • Operators face a challenge to strike the fine balance between showcasing new capabilities and delivering familiar services to the developer community 
  • More than half (54%) of developers see the value of network APIs in accessing network performance information, such as latency and jitter 
  • Cloud platforms are leading the way in terms of means for developers to access APIs 

LONDON – 13 January 2025 – More than half (55%) of software developers do not associate the term ‘network application programming interfaces (APIs)’ with telecom network capabilities, but rather link these APIs with management of their wider IT networks. This is one of the main findings from the latest STL Partners survey, ‘Telecom network APIs: What do developers really want?’, which was conducted in November 2024 and examines the perceptions of more than 400 software application developers across key global markets. 

To help address the lack of familiarity with their potential, telcos need to strike “a fine balance” between demonstrating new capabilities and delivering services in a way that developers are already familiar with, according to STL Partners research director and author of the survey, Amy Cameron. 

“We believe operators should position their APIs as delivering similar functional capabilities to existing APIs – i.e., ability to manage network functions, control access to resources and exchange data across different networks – but across a new networking domain that has previously been unavailable to them”, the analyst adds. 

On the flip side, the survey shows that the developer community is increasingly aware of industry-driven telecom API initiatives, such as GSMA Open Gateway and CAMARA, but there is more that can be done to boost knowledge in this space.

Despite the need for education on telecom APIs, STL Partners has seen clear interest in the capabilities that telcos can offer to developers. When asked about the perceived value of different features of network APIs, accessing network performance information, such as latency and jitter, was the most popular choice, deemed attractive by more than half (54%) of developers.

Furthermore, the research has found that:

  • Half of respondents from the developer community see understanding device status on the network as appealing
  • 44% see value in specifying and guaranteeing network performance levels for a period of time.

Another notable finding suggests that developers get APIs predominantly through hyperscalers, such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud and others (see graph below). This applies even to telecom APIs, with Microsoft claiming the top spot in terms of overall customer experience for developers.

Therefore, Cameron suggests, the telecom industry should ensure that developers can access APIs in the channels they are already familiar with – starting with cloud platforms, and then through systems integrators and on telcos’ own platforms.

“This approach should lower the barriers to adoption enough to expand telcos’ reach beyond developers focused on priority communication and into the wider enterprise productivity, IT and internet of things (IoT) developer market”, the author concludes. You can find out more insights from the survey by downloading an extract here.

For media enquiries, click here to get in touch with our team.

There will be nearly 2000 network edge data centres globally by 2028, STL Partners predicts 

  • STL Partners expects growing appetite for network edge data centre deployments, with a projected 22% CAGR over the next four years 
  • Telcos see the network edge as a pathway to improve return on their infrastructure investments 
  • The market will be driven by accelerated 5G standalone deployments and the rise in governmental support 
  • However, STL Partners does not expect AI to immediately speed up network edge rollouts 

LONDON – 6 December 2024 – STL Partners expects there will be more than 1800 network edge data centres by 2028, growing at a compound annual growth rate (CAGR) of 22% over the four-year period. 

In its latest market forecast, the analyst powerhouse suggests that accelerated 5G standalone (SA) deployments and the growing role of governments around the world in driving network edge rollouts, act as key driving forces for the market growth. 

Telcos are adopting a pragmatic approach as they look to better monetise their existing infrastructure investments – and the network edge has provided a pathway to achieving this. This applies for mobile, fixed and converged operators. 

For the first time in its observations of the market, STL Partners has tracked companies that are winding down their network edge propositions, having already built capacity. This is the case for AT&T (which had deployed two sites) and Cox Communications (which had deployed 30 sites).

Despite this, the research house’s outlook for the next four years remains positive.

Furthermore, STL Partners does not believe that the ambition of the AI-RAN Alliance to deploy AI services for customers using the same infrastructure currently used for radio access network (RAN) workloads will significantly accelerate network edge capacity in the immediate future.

“When it comes to edge AI, the network edge is like the ‘ugly duckling’, with other forms of edge computing deployment at current providing more attractive solutions for enterprises. For example, on-premise edge is playing a critical role in providing a secure and sovereign environment for enterprises to perform AI inference. Meanwhile, regional edge data centres are benefiting from the surge in demand for environments that can support AI model training”, explains George Glanville research analyst and author of the forecast.

He argues that the commercial proposition of the network edge, at current, is less clear, given that most AI use cases today do not have highly stringent latency requirements, and enterprises need to pay a significant premium to deploy workloads in these environments (in contrast to the cloud).

“It is only when wide-area AI use cases with stringent latency demands emerge that the network edge will truly spread its wings and fly”, Glanville claims. This is the case for many connected car and smart city use cases.

Find out more insights from STL Partners’ forecast by downloading an extract here.

For media enquiries, click here to get in touch with our team.

STL Partners sees 40% rise in generative AI implementations by telcos in three months 

  • Generative AI continues its momentum across telcos’ activities 
  • STL Partners has recorded nearly 300 announcements of GenAI technology implementations by telcos 
  • 47% of the activity is across telecom operators productising GenAI for their enterprise clients 
  • Solution providers for the telco industry are rushing to support it, as developments of GenAI solutions specifically designed for telcos proliferate 

LONDON – 19 November 2024 – STL Partners has seen a significant increase in the adoption of generative AI (GenAI) by telecom operators worldwide between August and November 2024, marking the swift prevalence of the technology far and wide. 

In its latest Telco generative AI adoption tracker, the research and consulting firm has found that 69 telecom operators have made a total of 282 GenAI implementations by the start of November, up 40% from August 2024 and recording a staggering fivefold growth over the last six months. 

‘Telcos are quick on their feet when it comes to using GenAI in their operations and products, surprising some sceptics in the industry,’ notes Marina Koytcheva, research director at STL Partners. Insights from the tracker show that 51% of all announcements are in full deployment, while 8% are in trials and 41% are at a stage of exploration. 

Based on the proliferation of early-stage activity and the expanding number of telecom operators engaging with GenAI, the analyst powerhouse expects the rapid adoption of GenAI by telcos to continue as they find new ways to derive value from the technology for themselves and, importantly, for their customers. 

‘Work on GenAI propositions for enterprise clients continues at a pace’, comments Koytcheva, citing figures which show that 47% of the GenAI projects relate to offering services such as chatbots and even infrastructure to business customers who don’t have the time, skills or interest in cracking GenAI on their own. 

Two other trends that STL Partners notes are sustained interest by telcos in owning their large language models (LLMs) in-house and efforts towards creating multi-model platforms. ‘Both point towards the desire to avoid lock-in with a single AI giant such as OpenAI or Google,’ remarks Koytcheva. 

Another significant development over the last months is the explosion of GenAI solutions designed to help the telco industry adopt the technology: STL Partners has identified 50 such propositions already. Three quarters of those have been specifically developed for the telco industry, while the rest are optimised for telecom among other industries.  

‘Clearly, the industry has noticed telcos’ ambition to adopt GenAI quickly – and solution providers are now rushing to compete for telcos’ attention and partnership,’ the analyst adds. ‘The good news is that while the growth of GenAI adoption in the telecom industry is steep, these are still early days: we are yet to hear from hundreds more operators around the world about what they are doing with GenAI.’ 

Find out more insights from the tracker by downloading a summary here

For media enquiries, click here to get in touch with our team.

AI is crucial for driving adoption at the network edge, finds STL Research in latest survey  

  • Network edge locations are increasingly seen by developers as the optimum location for AI inferencing 
  • Two of the top three applications hosted at the network edge today leverage AI 
  • 24% of respondents anticipate GPU to be prevalent in edge adoption by 2029 

AI is seen as a key driver for adoption at the edge – and inferencing is better suited to edge environments in comparison with model training, according to the latest survey conducted by STL Partners. 

LONDON – 11 November 2024 – Based on its annual survey of more than 100 experts in the edge computing sector, conducted in October 2024, the research and consulting firm has uncovered the current status of the network edge, and challenges and opportunities in this area. 

The network edge is increasingly seen by developers as the optimum location for AI inferencing because it has a latency, sovereignty and cost advantage over centralised cloud infrastructure. 

A total of 61% of respondents cite video analytics/computer vision as the top application type deployed at the network edge. Specific examples of such solutions include customer behaviour analysis, connected car driver assistance, and machine monitoring and control. 

‘Computer vision use cases often require less bespoke integration work than other use cases, reducing the time to implementation and helping to create a more attractive business case. The data volumes that high-quality video creates plus the need for real-time alerts or insights lead to a clear reason for deploying at the edge’, comments Tilly Gilbert, consulting director and Edge Practice lead at STL Partners. 

‘There is a real and growing appetite for infrastructure that supports AI solutions in a way that is performant, cost-effective and for some regions – sovereign. Network edge is increasingly seen as a choice to best satisfy these needs. Recent examples, including Deutsche Telekom’s deployment to support an autonomous vehicle solution for Volkswagen at the Port of Emden, Germany, are indicative of this trend’, adds Anna Boyle, senior consultant at STL Partners. 

Another finding from the survey suggests that executives are bullish about the potential of graphics processing units (GPUs) being deployed at the edge. 

‘Demand for AI and generative AI (GenAI) applications at the network edge have mobilised telecom operators to deploy GPUs and other specialised silicon at these sites. More than 40% of respondents said that non-CPU hardware will make up between 40% and 100% of edge hardware by 2029’, comments Boyle. 

Zooming into specific verticals, STL Partners’ survey has discovered that the industrial sector remains the top adopter of network edge computing in 2024, closely followed by the media and entertainment vertical (see figure below). 

Notably, this year the public sector and financial services have emerged as new adopters of network edge

You can find out more takeaways from the annual telco edge computing survey by downloading an extract here.

For media enquiries, click here to get in touch with our team.

Telcos need to work harder to reduce their carbon footprint as they make AI advancements, new STL Partners research shows 

  • Operators make progress towards their sustainability goals but there is a lot more to be done on this journey, finds STL Partners 
  • Telcos should pay close attention to AI developments which already take a toll on tech companies’ environmental sustainability efforts 
  • Telefónica keeps its crown across various key sustainability-related efforts 
  • In its latest research, STL Partners emphasises on the importance of the human element of sustainable goals 

Drawing insights from more than 70 companies globally, STL Partners’ latest update to its ‘Sustainability scorecard’ offers a holistic overview of the maturity in sustainability reached by telcos and their peers, including vendors, infrastructure players and technology giants. 

LONDON – 16 October 2024 – Telcos need to work harder on their carbon reduction journey if they are to offset the negative impact of AI developments that already put a strain on tech companies’ environmental sustainability efforts, urges STL Partners in its latest research. 

This guidance comes as the research and consulting powerhouse has found in the latest update to its ‘Sustainability scorecard’ that AI is already having a “tangible effect” on greenhouse gas (GHG) emissions produced by some of the largest tech giants, including a 112% increase in the total scope 2 emissions of Meta, Microsoft and Alphabet’s Google between 2019 and 2023. 

At the same time, operators are quick to move towards implementing AI-as-a-service (AIaaS) which poses the question whether a similar impact will shake up telcos’ net-zero efforts. 

“Telcos are beginning to build generative AI into their own activities as well as their enterprise service portfolios, providing content summarisation or creation for enterprise sales and marketing teams, or even offering ‘GPU-as-a-service’ to enterprises. Those that are successful in embedding these heavy-duty AI tools into their own processes and enterprise services could face similar challenges to the hyperscalers with rising emissions”, cautions Amy Cameron, STL Partners research director and co-author of the sustainability scorecard. 

To mitigate this risk, she suggests that operators should “put processes in place to assess the energy consumption versus business benefit of generative AI deployments, use smaller language models where possible and integrate a carbon tax into the total cost of ownership when procuring any new infrastructure to support these services.” 

In another concerning insight, the company has discovered that only 49% of the examined telcos have publicised responsible AI frameworks compared to more than 85% of vendors and tech companies. Therefore, beyond mitigating AI’s impact on emissions, “operators must also establish frameworks ensuring they utilise AI in a responsible and ethical manner”, argues George Glanville, analyst at STL Partners and co-author of the scorecard. 

In addition to the environmental aspect, STL Partners’ scorecard update depicts the landscape in the market in terms of other elements that make a company sustainable – and offers insight into best practices in each area. 

Among its key findings is that Telefónica remains the most sustainable company in the telco realm, showing progress made in key criteria, such as board and employee incentives related to sustainability goals, issuance of green bonds, and enhanced inclusion, diversity and governance efforts. 

BT is breathing down Telefónica’s neck with highest scores measured in terms of board-level and employee incentives, enablement and collaboration, while Google ranks third with top performance in collaboration. 

Overview of top three scoring companies

Furthermore, STL Partners’ research suggests that while telcos and their peers are improving the gender diversity across their teams, there is still a long way to go. Top performers in this area are Netflix and Globe Telecom which are close to achieving gender parity both in senior management and across their total workforce.

You can find out more insights from the sustainability scorecard by downloading an extract here. For media enquiries, click here to get in touch with our team.

Telco generative AI implementations quadruple since May, finds STL Partners

  • Generative AI implementations by telcos increased fourfold between May and August, according to STL Partners’ latest research
  • The company has tracked more than 200 implementations of the technology worldwide, with actual launches significantly rising
  • Telcos show increased focus on developments utilising multiple large language models and proprietary models

STL Partners’ latest quarterly update to the ‘Telco generative AI adoption tracker’ provides an overview of the current level of progress in GenAI implementations made by telcos, the key capabilities of the technology applicable to the sector, as well as a comprehensive list of the use cases with highest potential of bringing benefits for operators and their customers

LONDON – 28 AUGUST 2024 – Generative AI (GenAI) implementations by telecom network operators have almost quadrupled between May and August 2024, while telcos increasingly eye monetisation opportunities unleashed by the technology’s capabilities, according to the latest update to the ‘Telco generative AI adoption tracker’ compiled by STL Partners.

Based on publicly available data on trials and deployments announced in the three-month period, the research and consulting company has tracked a total of 201 records of GenAI implementations by telcos worldwide, up from 56 in May. “Telcos have shifted a gear up on the adoption of GenAI,” comments Kerina Naran, analyst at STL Partners, adding that operators that have unveiled actual implementations nearly doubled in the period to 54 on a global scale.

“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,” explains the analyst who is a co-author of the tracker update.

Notably, STL Partners has discovered that telcos are swiftly moving beyond announcements to actual launches of GenAI use cases, with half of recorded implementations by August 2024 being of launches (up from 21% in May when announcements dominated).

According to the tracker’s latest update, implementations that can utilise multiple large language models (LLMs) are growing fast, as is the number of telcos working on their own LLMs.

Another highlight suggests that there is significant activity by telcos to seek monetisation opportunities from their GenAI-related efforts. “A staggering 45% of the implementations we’ve recorded seek to capture the rising interest of the enterprise sector in AI by offering AI-as-a-service,” notes Naran. “Larger enterprises may have figured out their AI strategies, but many small and medium businesses don’t even know where to start, and a number of telcos have spotted the opportunity to help them.”

STL Partners’ tracker update further outlines the dominant business areas where GenAI is being adopted by telcos, and explores why, to a large extent, the industry is still in its early days for the technology. Find out more by downloading the summary here.

STL Partners is a leading, global research and consulting firm that focuses on the telecoms and technology industries. We enable telcos, tech companies, and their partners to make the world run better. More information on our research and services is available at www.stlpartners.com

Scaled migration of telco workloads to the public cloud unlikely before 2028-2030, according to STL Partners’ latest report 

STL Partners dives deep into the current positioning of each of the three hyperscalers – AWS, Google Cloud and Microsoft Azure – on the telco vertical outside China, their level of success in convincing operators to migrate their business to the public cloud and the main hurdles around workload migration

LONDON – 22 August 2024 – Scaled migration of telco workloads to the public cloud is unlikely to happen until the next wave of network refresh expected with the move to 6G, and large-scale open RAN and virtualised RAN (vRAN) developments from 2028 onwards, according to new research from STL Partners. 

In its latest report, ‘Hyperscalers in the telco vertical: Strategies and successes’, the telecoms consultancy and research company examines the current role of hyperscaler activity in the telco realm and offers insights on how operators can improve their innovation levels by embracing the public cloud approach. 

Among its key findings, the research firm suggests that telcos have been steadily moving their business support systems (BSS) and telco IT workloads to the public clouds of the top three hyperscalers – Amazon Web Services (AWS), Google Cloud and Microsoft Azure – since the end of the 2010s. 

The radio access network (RAN) ranks on the lower end on the maturity scale, followed by core migration, and by deployments of edge computing and private networks, partly due to the immaturity in these markets. Meanwhile, the picture is mixed when it comes to operational support systems (OSS) migration to the public cloud. 

Challenges and opportunities 

STL’s study highlights several significant hurdles on the telco journey towards public cloud migration, with sovereignty cropping up as a main barrier in many regions, and particularly in Europe. 

There is also a question around the readiness of operators for the public cloud. “Telcos have invested heavily in virtualising and modernising their networks, but migrating certain workloads to the public cloud requires that next step in networks being really cloud-native – and many operators are still in that process”, claims Emma Buckland, the report’s lead author.  

Another challenge might be that the telco vertical is – at least for now – too small for the public cloud players, as network workloads don’t provide enough business to them until the next network refresh. However, a silver lining might be on the cards, as telcos are found to be increasingly keen to use hyperscalers’ tooling and capabilities in data and AI, in a bid to keep up with the dynamic pace of developments and innovation in this realm. 

Finally, if operators are to free up resources so that they can focus on innovation, the research firm urges that more telco workloads be migrated in a mix of public and hybrid environment (for example, on-premises servers with hyperscale cloud layer for distributed workloads). 

The 50-page report includes a detailed profile for each hyperscaler and an assessment of their positioning on the telco vertical for each type of telco workload migration to the public cloud. A sample of the report is available here and it can also be purchased on our store here.

STL Partners is a leading, global research and consulting firm that focuses on the telecoms and technology industries. We enable telcos, tech companies, and their partners to make the world run better. More information on our research and services is available at www.stlpartners.com

STL Partners Forecasts 62% Annual Growth in Private Network Spending, Hitting $21 Billion by 2030

Spending on building, running and maintaining private mobile networks will grow at a compound annual rate of 62% from US$1.2 billion in 2024 to US$21 billion in 2030 worldwide, according to a recent forecast by telecoms research agency STL Partners.

 LONDON, ENGLAND, March 20, 2024 “Enterprises are investing in digital transformation and private networks are seen as important enablers of applications that not only drive productivity and operational efficiency, but fundamentally change the way that operations run,” points out Yesmean Luk, Principal Consultant and Private Networks practice lead.

• Private mobile networks spend to reach US$21 billion by 2030
• Applications to account for over 40% of the value
• 4G will continue to dominate the market until 5G takes its crown in 2028

Growth has been more modest in the last two years, as enterprises needed to be convinced of the return on investment, and the weak macroeconomic outlook did not help. However, things are picking up, and STL Partners expects the three years from 2024 to 2026 to bring more adoption before the market scales up to surpass US$5 billion in 2027.

“The private network market is more than just infrastructure,” explains Ahmed Ali, Senior Analyst. Much of the growth in market value will be driven by the applications layer, which will increase its share from 14% of the total revenue in 2024 to become the biggest part of the value chain, with a 42% share at over US$9 billion in 2030. “This explosive growth will be driven by enterprises utilising their private networks infrastructure more efficiently to run multiple applications and compute-intensive use cases,” continues Ali.

Countries with highly developed industrial sectors are poised to lead the space, with China and the United States projected to command significant shares of the market by 2030, amounting to US$2.4 billion and US$1.8 billion, respectively.

Manufacturing has led the way and will remain the largest spender on private networks for the foreseeable future. In 2024 it will account for almost 50% of the market, but its share will shrink by 2030, as utilities, extractive industries and logistics all see a boom in adoption.

“Despite much talk and hype about 5G in the telecom industry, 4G (LTE) will remain the dominant technology in private mobile networks until 2028, when 5G will take over the pole position,” remarks Luk. This is because for many enterprises 4G is considered sufficient to meet the requirements of most early, tactical use cases, such as reliable connectivity in remote locations. “Still, as more 5G devices come to market, the cost of deployment goes down, and dynamic network slicing and standalone 5G become more widely available, we expect 5G-based deployments to become more widespread among enterprises, including small-to-medium sized companies. Simply put, the barrier to entry will be lower”, concludes Luk.

STL Partners is a leading provider of market analysis and consulting services in private networks. Our research portfolio includes thought leadership reports, market forecasts, deployment database, and use case analysis. More details can be found here: https://stlpartners.com/private-cellular-networks/

STL Partners is a leading, global research and consulting firm that focuses on the telecoms and technology industries. We enable telcos, tech companies, and their partners to make the world run better. More information on our research and services is available at www.stlpartners.com

STL Partners unveils its latest sustainability scorecard update for 2023

STL Partners unveils updated Sustainability Scorecard featuring new criteria and companies: Assessing telecoms & adjacent sectors, promoting cross-industry collaboration, and addressing scope 3 emissions challenges.

 LONDON, ENGLAND, March 22, 2023 — STL Partners, a leading research and consulting firm in the telecoms industry and adjacent markets, has released the latest update to its Sustainability Scorecard. The scorecard provides an independent assessment of the sustainability performance of a selection of companies, including telcos and companies in adjacent industries including tech companies, infrastructure players and streaming companies.

The 2023 update includes 10 new companies, including vendors, and a new criteria for cross-industry collaboration. The scorecard now assesses whether companies are working collaboratively with peers to drive pan-industry change and address the scope 3 emissions challenge.

We added an additional criteria for assessing the sustainability maturity of different companies. We wanted to emphasise the importance of the industry working together to find common solutions to tackle the challenge of sustainability.” said Grace Donnelly, Senior Consultant, STL Partners.

The scorecard benchmarks the performance of companies against eight sustainability-related criteria, including holistic sustainability reporting, sustainability commitments and incentives, public reporting on scope 1, 2 and 3 emissions, green finance, commitment and progress against diversity and inclusion targets, commitment to biodiversity, enablement and collaboration.

The scorecard is designed to support telcos and their partners to benchmark their sustainability performance against competitors, identify areas of relative strength, and identify specific actions they can take to embed sustainability more effectively across their organisations.

STL Partners’ Sustainability practice is committed to sharing best practice, insights and, supporting rationale for the industry to accelerate its transition towards a more sustainable future. The practice provides off the shelf research and bespoke consulting engagements to support the industry’s sustainability agenda.

US$8 billion invested in edge since 2020 – new research from STL Partners

STL Partners’ report reveals nearly US$8 billion invested in edge computing since 2020, with a shift towards mature, scale-up investments and significant growth in later-stage VC funding, marking industry resilience and investor confidence.

LONDON, ENGLAND, January 18, 2024 – STL Partners, a leading analyst firm in technology and market leader in edge computing insights, today released their latest report, “Analysing Edge Computing M&A Trends”. This study provides a detailed analysis of the investment landscape and market evolution in edge computing over the last four years.

Key findings:

• Nearly US$8 billion has been invested in the edge ecosystem since 2020
• Investments have predominantly targeted edge software companies, with US$3 billion invested, followed closely by edge data centre operators with US$2.3 billion
• Venture capital has been the primary investment source, totaling US$4.1 billion over the four-year period
• The edge investments market is maturing. In 2020, 39% of venture capital investments in edge were pre-Series A. By 2023, this number dropped to 20% being pre-Series A
• The two largest disclosed investments in Edge to date were recorded in 2023 – the US$790 million private credit secured by AtlasEdge from investors led by ING Bank and the US$500 million private equity investment by I Squared Capital to establish nLighten

Edge computing investments were resilient to the general cooling in the technology markets that were experienced in 2023. This resilience is a testament to the sector’s unique value proposition and its critical role in the future of digital infrastructure. Our report highlights the robustness of edge computing as an investment area, with a shift towards more mature, scale-up investments. These trends not only signify the growing maturity of the market but also underscore the confidence investors have in the potential of edge technology” said Tilly Gilbert, Director and Edge Practice Lead, STL Partners.

Growth in Later-Stage VC Funding

A significant trend identified in the report is the notable increase in later-stage VC funding within the edge computing sector. This shift marks a maturation in the market, with investors showing confidence in established edge companies. In 2023, the proportion of later-stage investments hit 80%, reflecting a transition from funding early-stage startups to scaling up more mature enterprises. This trend suggests a robust and healthy ecosystem. 

Biggest Investments to Date Recorded in 2023

The report also sheds light on the value and volume of transactions in edge computing over the past four years. While the initial years saw a diverse range of investments with a mix of smaller, speculative bets and larger, strategic investments, the trend shifted noticeably by 2023. The sector began attracting larger, more substantial investments, indicative of growing market confidence and recognition of edge computing’s long-term value. 2023 saw the two largest disclosed deals in the industry, signaling an increasing interest in high-potential edge computing ventures and sending a positive signal for investors as we enter 2024.

About the Report’s Methodology

STL compiled the data set from publicly available information, investor resources and our proprietary edge insights service. Please get in touch if you would like to discuss access to the underlying data.

STL Partners is a leading research and consulting firm that focuses on the telecoms industry and adjacent markets, by supporting telcos and their partners innovate, grow and stay ahead of the competition. STL’s Edge Insights Service provides a combination of tools to support telecoms operators and technology companies in developing their edge computing strategies.

STL Partners to attend MWC Barcelona 2024 and host exclusive roundtable on sustainability in the telecom sector

During MWC 2024, STL Partners and Red Hat will host a key roundtable on “Realising Value from Enterprise Net Zero Ambitions,” focusing on telecom sector sustainability.

LONDON, ENGLAND, January 19, 2024  As the world’s largest and most influential connectivity event, Mobile World Congress (MWC) Barcelona 2024 is set to be a pivotal platform for industry leaders and innovators. Scheduled from February 26 to 29, 2024, at Fira Gran Via, Barcelona, this event promises an unparalleled opportunity for networking, envisioning future technologies, and sharing groundbreaking ideas. MWC Barcelona 2024 will feature an array of themes, including the transformative power of AI, growth strategies for startups, insights into corporate innovation, the art of innovation, and the implications of decentralisation technologies like blockchain.

This year, STL Partners, in partnership with Red Hat, will host an exclusive roundtable centered on the theme of “Realising Value from Enterprise Net Zero Ambitions.” Scheduled for February 27th, from 9:00 AM to 10:30 AM CET at the Eurohotel Gran Via Fira, this invite-only event will offer a unique blend of expert insights and interactive discussions, focused on the intersection of telecommunications and sustainability.

STL Partners and Red Hat’s roundtable will specifically address the burgeoning need for sustainable practices within the telecom sector. The roundtable will delve into critical aspects of sustainability in the telecom industry, exploring how companies can drive green revenues by supporting enterprises in their sustainability efforts. It will leverage STL Partners’ extensive B2B and sustainability research, providing a platform for thought leaders and decision-makers to exchange ideas and strategies.

Key discussion points will include the types of sustainability enablement services that telecom companies can offer, factors impacting enterprise demand for sustainable products and services, and the steps telecom companies should take to tailor their offerings to maximize green revenue potentials.

With limited seats available, the roundtable promises to be an insightful and engaging session for all participants. Interested attendees are encouraged to RSVP as soon as possible to secure a spot at this exclusive event, which includes a complimentary breakfast. MWC Barcelona 2024, with over 88,500 attendees from 202 countries, provides the perfect backdrop for this important discussion.

For more information and to register for the roundtable, please visit STL Partners website.

STL Partners is a leading research and consulting firm that focuses on the telecoms industry and adjacent markets, by supporting telcos and their partners innovate, grow and stay ahead of the competition. STL Partners’ Sustainability practice is committed to sharing best practice, insights and supporting rationale for the industry to accelerate its transition towards a more sustainable future. The practice provides off the shelf research and bespoke consulting engagements to support the industry’s sustainability agenda.

Research Highlights How Changing Approach to Monetisation Can Unlock BSS Transformation and Save Millions Annually

STL Partners, in partnership with MATRIXX Software, releases a new report focused on the impact of transforming revenue management systems

LONDON, ENGLAND, February 20, 2024  STL Partners, a leading analyst firm in technology, today released their latest report, “Why legacy billing restricts telco growth,” commissioned by MATRIXX Software, a global leader in 5G and digital monetisation solutions. The report highlights insights from a recent research programme aimed at understanding CSPs’ current revenue management operations and transformation approach.

“Telcos are investing heavily to make their networks more flexible and agile and seeking to use APIs to unlock network capabilities for third-party developers. However, all of this is useless if they cannot realise value due to limitations with legacy billing systems. A focus on billing consolidation is not enough – there is a need to replicate network improvements in billing and embrace flexible and agile monetisation systems,” said Chris Barraclough, CEO, STL Partners.

Key findings:

• Traditional billing and charging systems, tailored for basic connectivity, are proving inadequate for the fundamentally different business models of 5G services.
• For a typical Tier-1 operator, shedding legacy architecture can unlock an estimated 20% greater efficiency in billing operations and deliver up to $13 million in annual cost savings.
• Embracing transformation enhances operational efficiency and delivers innovative and personalised services.

“We have worked with telcos who have tried, and invested significantly in, IT simplification programs that attempt to consolidate multiple billing streams into a single legacy platform,” said Jennifer Kyriakakis, founder and CMO, MATRIXX Software. “What they realise every time is that legacy platforms struggle to deliver the flexibility and efficiency required to innovate and cannot adapt to new multi-party business models across consumers, enterprises and partners without significant investment and customisation.”

Embracing Transformation for Operational Efficiency

The report highlights that many operators are currently focusing on consolidating legacy billing systems. However, even if legacy systems are reduced in number, the inherent complexity continues to pose challenges and hinder innovation. Overcoming challenges related to customer adoption and payment for new services is crucial for achieving a robust return on investment. Therefore, telcos need to adopt a transformative strategy to revolutionise core processes and achieve greater operational efficiency. The business case for this should be built around cost savings from reducing operating expenses and infrastructure capital expenditure.

Innovative Architectures for 5G Evolution

In addition, operators can enhance efficiency by adopting converged architectures, offering a unified view of customer interactions and reducing maintenance costs. Prioritising low-code/no-code solutions can empower non-IT teams to make changes to products and services without depending on specialised BSS engineers. Embracing open and scalable architectures is essential for quick adaptation to the increasing number of devices associated with 5G and evolving service portfolios.

Download the full report here.

About the Report’s Methodology

STL compiled the insights from an interview programme with senior decision makers in CSPs and a focused survey with individuals from CSPs worldwide. STL also evaluated the financial value through cost savings of transforming billing and charging across telcos’ operations. Please get in touch if you would like to discuss access to the underlying data.

About STL Partners:

STL Partners is a leading research and consulting firm that focuses on the telecoms industry and adjacent markets, by supporting telcos and their partners innovate, grow and stay ahead of the competition.

About MATRIXX Software:

MATRIXX Software delivers a modern converged charging and digital monetisation solution proven at scale. MATRIXX enables commercial innovation and real-time customer experiences that drive revenue and growth opportunities across multiple markets.

Telcos Lag Six Years Behind Hyperscalers in Key Tech Skills, Jeopardizing Future Growth

Telcos are more than six years behind hyperscalers like Microsoft, Google or Meta when it comes to building strategic capabilities in the workforce for success in the future, according to the latest research by technology analyst firm STL Partners.

LONDON, ENGLAND, April 10, 2024 

• Telcos lag behind hyperscalers and similar tech companies in acquiring skills such as AI, innovation and user experience that will help to secure their futures.

• Building key tech capabilities is of strategic importance for telcos to realise their ambitions.

“The ‘telco-to-techco’ ambition is shared by many telecom operators who want to operate and be valued in a similar way to tech giants. To achieve such a challenging transformation, telcos need access to certain critical skills. Our research has identified nine categories of skills, ranging from software, cloud and cyber security to AI and innovation, that prepare telcos to take advantage of the growth opportunities that open, software-based networks will allow in the future.” says Nicola Warren, Senior Analyst, STL Partners

In a sample of 19 telecom operators and nine tech companies from around the world, it was revealed that an average of 14% of the telco jobs were focused on these future skills categories. This compares to 31% for the techcos. Among the telcos in the study, Swisscom, Singtel and Telstra are frontrunners and see the largest share – over 20% – of their workforce in jobs that relate to future capabilities.

Further findings suggest that telcos have extended their focus on future capabilities, with almost all telcos accelerating the acquisition of such skills over a 12-month period. “Software and data analytics roles assumed a higher share of telco recruitment than network roles in the last year. Telcos’ investment in cyber security and automation was also more aggressive than that of techcos in this period. However, automation and user experience investment and acquisition of artificial intelligence expertise is still not strong enough” continues Warren.

“Bringing in the right capabilities, and doing it quickly, is so critical for telcos’ future success that achieving this goal should be elevated to the highest level in the organisations”, observes Marina Koytcheva, research director at STL Partners. “Competition for the best tech talent is fierce in many countries, so telcos need to rapidly upskill their current workforce if they want to be equipped for growth in the future.”

STL Partners is a leading, global research and consulting firm that focuses on the telecoms and technology industries. We enable telcos, tech companies, and their partners to make the world run better. More information on our research and services is available at www.stlpartners.com