As CSPs transition into the Coordination Age, they face critical challenges in adopting cloud-native architectures and transforming operational models to meet the demands of enhanced connectivity and resource optimisation. This report provides practical strategies to navigate these challenges, with a focus on simplifying RAN transformation, enabling agility and unlocking new opportunities for innovation and growth.

CSPs must transform to capture the Coordination Age opportunity

The telecommunication sector is at the early stages of a new era: the Coordination Age. We are now in a world where networks are not only used to help people communicate and to distribute information and media. Networks are a critical foundation to enable the ‘coordination’ of machines, resources and processes that impact people’s lives and business operations.

In the Coordination Age, there will be increasing use of IoT, AI and advanced analytics to optimise resources, automate processes and drive efficiency on a global scale. CSPs have a unique opportunity to become enablers of this new age by leveraging their connectivity assets, capabilities and role as trusted national players to foster collaboration and innovation.

The Coordination Age is the third age of telecom

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To seize the opportunities presented by the Coordination Age, CSPs must undergo a significant transformation. These so-called next-generation CSPs will offer new products and services, developed and delivered in innovative ways, while fundamentally changing how they operate.

The transformation journey will differ for each CSP, shaped by factors such as strategic vision, market dynamics, capabilities, and resource availability: there is no one-size-fits-all model. Some CSPs may prioritise network infrastructure, others may focus on services, and many will adopt a hybrid approach, commonly referred to as the infraco, servco and techco models, respectively. CSPs will increasingly deliver technology-enabled processes and services across diverse industry and consumer verticals. In the longer term, the connectivity components of the technology solutions and services delivered will be increasingly created and managed on a dynamic, bespoke and on-demand basis around the needs of the use case and will be delivered over any enabling network or cloud.

Regardless of the model, the CSP of tomorrow looks different from today:

• Flexible finance and investment models due to a shift from capex to opex
  • Traditionally, CSPs have been ‘moat builders’, investing heavily in infrastructure and investing little in R&D. Next-gen CSPs will invest more in opex in a flexible, project-specific way to drive innovation and develop differentiated services.
• Inherently digital culture and skillset
  • Customer-centric, innovation-focused, adopting CI/CD and DevSecOps processes, with a strong emphasis on building internal skills and expertise around software development and cloud.
• New services and capabilities alongside traditional, macro-network voice and data, such as edge computing, private networks, network-as-a-service (NaaS), vertical solutions and applications, APIs and AI
  • For example, telcos are now actively exploring monetisation opportunities for generative AI, with many focusing on GenAI-as-a-service (GenAIaaS) targeted at enterprise clients.
• Greater operational efficiencies
  • Advanced automation for scalable, flexible and error-free network operations and the ability to dynamically match supply with demand
• Different go-to-market monetisation models – e.g., B2B2X, ‘as a service’
  • Transitioning to platform-centric models emphasising openness, modularity and cloud-native services delivered as a service, as well as B2B2X models.

Cloud-native underpins the transition to a ‘next-generation CSP’

Table of contents

• Executive summary
• Introduction: Network transformation is critical in the Coordination Age
  • CSPs must transform to capture the Coordination Age opportunity
  • Cloud-native is a core enabler of CSP transformation
• Cloud-native RAN: The final frontier
• Overcoming the unique challenges of cloud-native RAN
  • 1. Leverage pre-integrated and validated solutions
  • 2. Optimise edge infrastructure in the network
  • 3. Enact an automation-first approach
  • 4. Ensure interoperability between cloud-native and traditional, purpose-built RAN
• Conclusion

Related research

• Telco cloud deployment tracker Q1 2025: The various flavours of open RAN
• Total addressable market for AI solutions in the mobile telco network and OSS: USD18bn by 2030
• Not all telcos need to build their own AI factories
• Productising NaaS: A case study from India’s most disruptive player

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Kuba Smolorz

Kuba Smolorz

Senior Consultant

Kuba is a Senior Consultant at STL Partners, specialising in AI while bringing broad expertise across next-generation connectivity and infrastructure to assess its impact on telco operations and B2B revenue growth. He has led projects for a diverse range of companies, from major Tier-1 operators to technology startups, delivering market forecasting to prioritise opportunities, shaping product and GTM strategies, and facilitating customer workshops. Kuba holds a BSc in Biochemistry from the University of Bristol.