The Telecommunications Industry Is Ripe for Artificial Intelligence-Driven Solutions, with Service Providers Expected to Spend $11.2 Billion by 2025

Service Providers Look Toward AI Solutions to Help Ease High Fixed Costs and Retail Price Pressure

Telecommunications service providers face a handful of daunting market conditions. Around the globe, revenue and subscriber growth are flat. To combat profit erosion, most communications service providers (CSPs) are struggling through a process to become digital service providers more akin to web companies that offer rapidly evolving and highly customized services. According to a new report from Tractica, a central element of this transformation is the adoption of artificial intelligence (AI) technologies for network automation and management, customer experience management (CEM) and service delivery, virtual assistants for customer service and marketing, intelligent customer relationship management (CRM), and other key applications.

Tractica forecasts that CSPs will spend $11.2 billion annually on AI-driven software solutions across eight use cases by 2025, up from $419.0 million in 2018.

“5G/Internet of Things (IoT) and digital transformation are initiatives that CSPs hope will drive topline growth. While they pursue these efforts, CSPs are under equal pressure to find ways to become more efficient and cut costs as a means to increase profitability,” says principal analyst Mark Beccue. “Telecom operators have begun to experiment and deploy AI-driven solutions that leverage fast, scalable interpretation, analytics, and prediction to generate revenue or reduce costs.“

Tractica’s report, “Artificial Intelligence for Telecommunications Applications”, details the major market drivers and barriers, technologies, key players, and forecasts related to eight telecom AI use cases. These include network operations monitoring and management; predictive maintenance; fraud mitigation; cybersecurity; customer service and marketing virtual digital assistants (VDAs); intelligent customer relationship management (CRM) systems; customer experience management (CEM)/service delivery; and video compression. The technologies covered include machine learning (ML), deep learning (DL), and natural language processing (NLP). Global software market forecasts for telecom AI, segmented by region, use case, and meta category, extend through 2025. An Executive Summary of the report is available for free download on the firm’s website.

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