Telco Transformation and Future of Networks

Year-in-Review: Key Takeaways

• Telcos spent significant time reimagining customer experience, driven by the growing interest and applicability of generative AI
• Digitizing industry use cases has been challenging, with limited scalable and deployable solutions across geographies
• However, there has been no lack of bold bets from telco leaders around generative AI and network modernization

The Telco Flywheel

• The telco flywheel is centered around the network capabilities driving product experiences, which in turn drives usage and further network optimization
• Generative AI is impacting this flywheel by:
  • Automating and optimizing engineering efforts in network operations and product development
  • Potential to drive down network costs, enabling better products and experiences

Barriers to Adoption

• Moving from POCs to production use cases has been challenging due to:
  • Lack of scalable solutions and infrastructure
  • Difficulty in managing data and model governance
  • Rapid ecosystem changes requiring constant testing and evaluation

AWS Capabilities to Enable Telco Transformation

• Providing managed services like Amazon Bedrock to help builders create and govern generative AI applications
• Offering SageMaker and other platforms for telcos to train and fine-tune models
• Investing in silicon like Trainium and Inferentia to drive down the cost of inference and training

Customer Successes

• SK Telecom's deployment of a fine-tuned language model for customer service, resulting in improved response times, uniformity, and agent satisfaction
• O2 UK's integration of Amazon Connect to simplify their technical stack and enable a continuous customer conversation
• Telefonica's migration of 1 million subscribers to a 5G SA core running on AWS

Network Transformation

• Telcos are progressively moving network workloads to the cloud, starting with less complex and less latency-sensitive functions like OSS/BSS
• Newer use cases like multi-tenant MVNOs, high-availability disaster recovery, and virtual roaming gateways are enabled by cloud-native networks
• AWS is investing in ARM-based Graviton processors to provide cost-effective, power-efficient infrastructure for demanding RAN workloads

New Revenue Opportunities

• Telcos are exploring adjacent markets like smart home solutions, leveraging AWS IoT and generative AI to provide a seamless, intelligent experience
• SMB cloud solutions are another focus area, where telcos can package AWS services with their connectivity offerings
• Monetizing network assets beyond just connectivity through APIs is an emerging strategy, allowing developers to build network-enhanced applications

Key Takeaways

• The journey from POCs to production use cases of generative AI in telco is challenging but worthwhile
• Cloud-native network transformation is progressing, with newer use cases emerging
• Telcos are seeking growth opportunities by expanding into adjacent markets and monetizing network assets