Artificial intelligence in the telecommunications sector

There is a broad consensus among the executives of the world's leading companies about the impact that artificial intelligence will have on the telecommunications sector, as on all sectors.

The ways in which AI is going to help companies are manifold and not all of them have been fully explored yet. However, we can look at industry sectors and review what are the main innovations that are being generated by AI.

Artificial intelligence in the telecommunications sector

In the case of the telecommunications sector There are already very clear trends in the use of AI, which we will summarize below. 

Telecommunications companies face the challenge of digital transformation starting from their inherited situation as companies with many years of service and in continuous technological evolution: countless data models; information silos by areas and operations in different countries and continents, as well as different business priorities.

In a highly competitive context, with the emergence of new business models, strict legal regulations, as well as an increasingly demanding client, the use of Big Data, AI and Machine Learning technologies is presented as the great opportunity in the sector, both for their internal improvement and to expand the range of services they can offer to their clients. 

We can identify two generic areas of impact of AI in the telecommunications sector:

  1. Infrastructure-Networks.
  2. Commercial Offer.

Artificial intelligence in the telecommunications sector. Generic areas

Infrastructure and networks

Telecommunications networks are constantly evolving. The products and services available to customers are determined according to coverage areas. In addition, they are configured as a transport business in their own right, distributing content from third parties and even competitors. The digital economy is based on optimizing access and mobility, making infrastructure governance and management absolutely critical. 

Constant evolution of networks

Networks are constantly evolving. Currently, the 5G network is the latest paradigm, although we are already starting to talk about 6G technology.

Because networks are such a strategic asset, artificial intelligence in the telecommunications sector mainly employs two forms:

  1. For assist in network managementpredicting and optimizing traffic and infrastructure maintenance needs.
  2. For identify qualified traffic patternsThis is similar to the way it is done in the smart grids of electric utilities. This makes it possible to offer a higher service capacity to customers. 

Obviously, the Telcos are extremely careful with the use of customer data and the conclusions they can draw from them. Both regulators and data protection laws pay particular attention to protecting the visibility of traffic, so that it does not involve qualified information for those who carry it.

2. Commercial Offer

In terms of the impact of AI on your commercial offering, there are two situations to consider.

On the one hand, Telecos are not very different from other sectors immersed in digital transformation: with the consent of their customers, they use data to generate better product and service offers. Similarly, they try to predict the potential for sales success, as well as their customers' risk and ability to pay.

The differential nature of the Telecos compared to other sectors immersed in digital transformation is that are also constituted as digital service providers for its large customers.

In this regard, the current 5G challenge and its impact on other industrial sectors through Cloud, IoT, AI, Big data, etc. has led Telecos to become privileged providers of digital services for some specific segments of their large customers.

Therefore, we must bear in mind that we are talking about a complex ecosystem in which there is still much to be settled between telecommunications providers, advanced equipment manufacturers and digital service specialists.

In the case of 5G technology development, it is very illustrative to observe how Telecos continuously make decisions about their alliances with the aim of better serving their customers.  

In short, Telecos have special features in the new digital environment that make them particularly interesting for understanding the evolution of their sector and many others that are strongly linked to their services. Not only are they affected by the digital transformation, but they are also trying to establish themselves as privileged providers of these advanced services.

For all these reasons, the effective impact of 5G on companies will depend to a large extent on the way in which telcos manage their alliances and internal capabilities. Their role oscillates between being just a signal carrier or being able to lead the effective digital transformation of their customers. 

José Luis Escobar

Strategy and Business Development Director

GAMCO

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