The new telco playbook: 4 trends shaping 2025 and beyond

The telecommunications industry is in a state of constant evolution, driven by rapid technological advancements and changing market demands. We got into this a bit in my last article: telecommunications in our digital era, which built upon my predictions about AI and 6G.  Now I want to reflect on key trends shaping the future of telco, focusing on the insights gained from recent discussions and developments. Specifically, I'm interested in how the industry can navigate its toughest challenges and capitalize on emerging opportunities.

Is AI truly taking shape?  

While it continues to be the hot topic moving everyone's mind, I've found that many recent discussions are about how AI has already provided tangible operational benefits and quantifiable return on investment (ROI) in many of the business process areas within the telco industry. Another key AI theme we’re seeing is the evolution toward autonomous infrastructure, specifically how AI can "give automation a brain" to enhance network and resource efficiency, accelerate root cause analysis, improve sustainability to lower operational costs, as well as delivering reliable, high-quality digital services to diversify potential revenue streams.

With these initial successes in mind, along with the drive to deliver innovative digital services in a highly competitive market, service providers are taking pragmatic steps to transform their business. A smart modern service provider is one that's moving towards becoming a cloud-native and AI-native digital "techco".

What is happening with legacy networks?

There is also a clear focus on generating new revenues from Network-as-a-Service (NaaS) and open APIs leveraging open source projects like Camara, with the goals of becoming cloud-native digital techcos.

Last year, virtualization conversations were just getting started. We're now seeing a rapid shift, going beyond exploring alternatives to actively transforming legacy infrastructure.  Companies have moved into execution mode to gain the benefits of a common cloud architecture that combines mission-critical applications with modern AI-native applications.

Open RAN is taking off

Cloud-native open RAN got another boost of confidence this year and is gaining more and more acceptance. Many service providers are already deploying cloud-native open RAN with Red Hat and our networking partners. Open RAN momentum is in full flight, coupled with the fast moving introduction and implementation of AI-RAN to optimize performance and improve stability. Integrating AI and RAN on a cloud-native platform like Red Hat Openshift opens up new opportunities to dynamically tune RAN to adapt to changing demands, and enables cloud-native digital techco providers to offer innovative AI-native services that deliver business outcomes to enterprise customers. 

Is it time for 6G already?

It was inevitable that we'd talk about 6G and what it may bring in the future. However, recently we’ve seen a strong focus on how to efficiently scale and operationalize a service provider's cloud-native 5G standalone (SA) and 5G advanced deployments first. Service providers want to be able to recoup their investments and offer new services to generate revenues, but also to deliver reliable services. I was able to join a recent industry session , the end of the G Era, focused on how we could evolve the network architecture more rapidly.

Service providers are looking for gradual evolution so they can maximize the ROI on 5G investments and learnings, and to approach the next xG without another rip-and-replace cycle.  Another key factor is that xG advancements focus on improving radio access, scale, power efficiency, and service reliability. However, the broader discussion requires considering the evolution and expansion of wireline photonic and router networks, the increased distribution of the architecture and the integration of cloud- and AI-native software driven technologies. 

When will we know we're there? A few technical indicators could be:

• Seamless integration of wireline, mobile, Wi-Fi non-terrestrial networks (NTN) satellite networks
• Fully programmable silicon for scalable performance with reduced power consumption
• Software-driven radios that support multiple radio access technologies

I think the ultimate milestone will be the ability to deliver anything as a digital service, whether it be healthcare, wine, food, automotive operating systems, or entertainment without users (consumers and enterprises alike) needing to know or care about  the underlying infrastructure and technologies making it a reality.    

So what's next for our industry? Telco is a team sport. Realizing the full potential of these innovations requires open collaboration and contributions from everyone. We've made great progress, and we're looking forward to working with our customers and partners on the next innovations. Come and join us on this journey.