The annual IDC Telco Forum: Barcelona was held Sunday, March 2, to kick off the Mobile World Congress (MWC) 2025.
During the event, IDC delivered presentations that addressed pivotal transformation and monetization opportunities in the telecoms sector, as well as our expectations for the industry’s development through 2030. Key executives and stakeholders across the telecoms ecosystem and technology sectors attended the meeting (previously known as the IDC pre-MWC Brunch).
Telecom Industry: A Massive Market Undergoing Bold Transformations
Spending by telecoms worldwide is projected to reach $1.375 trillion in 2025, accounting for 24% of the global ICT market. Meanwhile, telecom service provider CAPEX intensity is declining year on year but is expected to reach $309 billion in 2028. This shift reflects the focus of telcos on network efficiency and simplified, cost-effective operations.
Internal Telco Transformation Trends in 2025
The telecom industry is undergoing a profound transformation, driven by slowing mobile data growth, market fragmentation, and increasing financial pressures. As the industry evolves, telcos are shifting from being traditional connectivity providers to being full-stack technology suppliers that require structural changes to sustain profitability.
Market consolidation, workforce realignment, and strategic investments are now central to long-term success.
Reinventing the Business Model
To enhance efficiency and financial resilience, operators are consolidating in domestic markets and reassessing international operations. European regulators have approved key in-market mergers that come with network investment commitments, signaling a broader acceptance of industry consolidation.
Middle Eastern telcos are strategically acquiring stakes in European firms, capitalizing on stock market fluctuations to expand their influence. Operators are streamlining their international presence, divesting from underperforming markets and leveraging joint ventures to optimize scale and operational efficiency.
The Rise of LEO Satellite Partnerships
Satellite technology is playing an increasingly strategic role in telecom operations, addressing connectivity gaps where terrestrial networks are insufficient. The convergence of low Earth orbit (LEO) satellite networks with mobile infrastructure is gaining traction, particularly in the realm of direct-to-device (D2D) connectivity.
By forming alliances with satellite providers, telcos can extend their service footprint, unlocking new revenue streams in remote and underserved regions. Some LEO providers are partnering with chipset and device vendors to enable direct satellite connectivity on standard mobile devices. Efforts are underway to expand dedicated satellite frequency bands to support this growth.
Programmable Networking Gains Traction
The shift toward network programmability is pushing telcos to embrace API-driven ecosystems that enhance service agility and unlock new monetization opportunities. Network API monetization is becoming a key revenue stream, with operators engaging enterprise developers, aggregators, and cloud marketplaces to integrate network capabilities into digital services.
In the short term, quick-win APIs such as SIM swap and number verification are gaining traction. More advanced APIs, like quality on demand (QoD), hold greater long-term potential but remain a secondary focus.
The real value lies in combining multiple APIs, such as QoD with security or edge computing, to deliver differentiated, high-value solutions.
To scale these opportunities, multi-operator collaboration will be essential to ensure broad applicability across industries. Additionally, developers will require training and certification to fully leverage telco APIs, raising questions about who will provide this support.
As telcos expand their API strategies, they must also address a critical challenge: avoiding commoditization and securing a strong position in the evolving digital value chain.
AI Moves from Hype to Execution
AI is rapidly moving from theory to real-world deployment, transforming both network operations and customer engagement. GenAI is already driving measurable improvements in predictive maintenance, automated network management, and customer service.
The next stage of adoption will integrate task-specific AI agents to further enhance efficiency, streamline operations, and optimize service delivery. However, challenges persist: Security risks are the primary reason for GenAI project delays or abandonment (43%), while project costs rank lowest (10%), according to IDC’s 2024 Future Enterprise Resiliency and Spending (FERS) Survey.
Telcos are leveraging GenAI across two key areas: operational efficiency and customer experience. In network operations, AI-powered copilots assist with incident management, collaborative network operations, and intelligent field support, while SOC-NOC collaboration enhances user experience assurance. On the customer experience side, GenAI is improving business support systems (BSS) knowledge sharing, lead generation for enterprise markets, intelligent service recommendations, and complaint handling.
With adoption accelerating, telcos must address security concerns, workforce adaptation, and cost control to fully capitalize on GenAI’s transformative potential.
Telco Monetization Strategies
As traditional telecom value chains evolve, operators must rethink their approach to monetization. A customer-centric mindset, combined with rapid experimentation and continuous iteration, is essential to stay competitive.
Leveraging composable technology stacks is a key enabler of monetization. By adopting modular, API-driven architectures, telcos can achieve greater flexibility, enabling mass customization and cost-efficient service delivery. The transition to 5G standalone networks is further driving the need for new monetization models, particularly in network slicing and private 5G solutions that offer premium, differentiated services for enterprises.
AI and API monetization are expected to become major revenue contributors. The telco AI market is projected to grow from $235 billion in 2023 to $632 billion by 2028, capturing 6% of global AI spending.
Similarly, the telco API market is forecast to reach $6.7 billion by 2028, expanding at a 57.1% CAGR, with significant contributions from the Americas ($2.7B), Europe ($1.9B), and APAC ($2.1B). Industry-wide initiatives such as the GSMA Open Gateway — supported by 67 mobile operator groups across 265 networks and covering 75% of global connections — highlight the strategic importance of API-driven revenue growth.
Winning Strategies for Telcos
Service Play
Telcos must focus on select industry verticals, leveraging in-house capabilities and strategic partnerships to develop specialized solutions. The ability to deploy rapidly, monetize effectively, and refine value propositions based on market feedback will be key to success.
Platform Play
Connectivity remains central to telco operations, but its value proposition is evolving. Operators must enhance their offerings by prioritizing security, performance, and flexibility, ensuring that their networks support a broad range of enterprise use cases beyond basic connectivity.
Vertical versus Horizontal
Telcos must determine whether to pursue vertical or horizontal service models. A vertical approach focuses on industry-specific solutions, including private 5G, edge computing, network as a service (NaaS), and network slicing, providing tailored services to high-value sectors. In contrast, a horizontal approach emphasizes the development of scalable, reusable capabilities that can be deployed across industries, optimizing efficiency and cost structures.
META: The Emerging Digital Hub
The Middle East, Turkey, and Africa (META) region is emerging as a key digital hub, driven by large-scale infrastructure investments and regulatory support. Network expansion is accelerating, with increased investment in datacenters, subsea cables, and carrier-neutral facilities.
Strategic initiatives are enhancing regional interconnectivity, particularly in Africa and major hubs such as the UAE, Saudi Arabia, and Turkey. Favorable policies are enabling digital transformation, fostering internet traffic growth, and supporting the proliferation of digital services.
The Future of Telco Transformation
Sustained success in the telecom industry requires a shift toward platform-based, adaptable service models that serve multiple industries. As telcos position themselves as digital transformation enablers, they must balance efficiency, innovation, and strategic investments to remain competitive in a rapidly evolving landscape.
Key Takeaways
- Slowing mobile data growth necessitates new monetization strategies beyond traditional bandwidth expansion.
- Telco transformation must focus on efficiency, simplification, and adaptability.
- Attracting and retaining top talent is crucial to leveraging disruptive technologies.
- Collaboration across ecosystems is essential for both commercial and technical advancement.
- Energy efficiency is a strategic priority, directly impacting both OPEX and CAPEX decisions.
The telecom sector is entering a decisive phase. Those who embrace transformation will define the industry’s future.
If you missed the IDC Telco Forum: Barcelona session, you can watch the content in a webcast on March 12: MWC2025: Telco Transformation and Monetization in EMEA.
