The rapid evolution of Artificial Intelligence (AI) has triggered transformative possibilities for the telecommunications (telco) sector. The impact of AI on the telco of tomorrow A panel discussion at ITW Asia 2024, chaired by Virat Patel, managing director of Pioneer Consulting Asia-Pacific, delved into how AI is reshaping telcos, from operational efficiencies to customer experience improvements, predictive maintenance, and new business models.

The session featured insights from Mizutani Yasutaka, President APAC of Colt Technology Services; Michael Wheeler, EVP and head of global IP network at NTT Data; and Rohan Thareja, senior technical specialist – data and AI at Microsoft.

• Virat Patel, MD - Pioneer Consulting Asia-Pacific
• Mizutani Yasutaka, President APAC of Colt Technology Services
• Michael Wheeler, EVP & head of global IP Network - NTT Data
• Rohan Thareja, senior technical specialist - Data & AI - Microsoft

Patel opened the discussion by highlighting how telcos are leveraging AI for internal operational efficiencies, such as predictive maintenance, while also exploring revenue-generating opportunities.

He set the stage with an AI use case focused on talent development, showcasing how AI could create intuitive and conversational 360-degree assessments to enhance employee growth. “The results are amazing,” he remarked, contrasting this use with the more common applications of AI for cost-cutting.

Michael Wheeler of NTT Data provided a historical perspective on his organisation’s journey in leveraging AI for network operations. Referring to NTT's in-house software-defined network controller (SDN), he shared how automation had streamlined processes, improved accuracy, and reduced operational expenditure.

“Programmatic distribution of the configuration of the network creates a bunch of benefits,” he said, emphasising the role of AI in enhancing these processes. However, Wheeler clarified that NTT Data remains cautious in its deployment of AI. “We’re not using it to do the configuration; we’re using it to validate configurations we’ve already done,” he explained.

This involves leveraging AI to compare proposed solutions against pre-existing ones for fault tolerance and resilience. While some might criticise the prevalence of proof-of-concept (POC) fatigue in AI adoption, Wheeler argued that POCs are a necessary step in refining AI’s role in telco operations.

When asked about the potential for AI to enable new customer-facing services, Wheeler was measured in his response. He suggested that the most likely near-term applications would involve go-to-market strategies rather than product innovation.

AI’s ability to analyse traffic flows and integrate financial modelling for customer profitability assessments is already proving invaluable, he noted.

Mizutani Yasutaka of Colt Technology Services shared a contrasting perspective, highlighting Colt's successful deployment of AI to amplify its customer pipeline and enhance segmentation.

By analysing intent signals, Colt increased its pipeline by 350%, enabling precise identification of customer needs. “We can basically start the conversation by bypassing all the conversation to identify what they’re interested in,” Yasutaka explained. Colt also leveraged AI during the COVID-19 pandemic to identify companies struggling financially and offer payment flexibility, a move that strengthened long-term customer loyalty.

“Pretty much all of them came back really strong and told us Colt was the only company offering such flexibility,” Yasutaka recalled. On the topic of revenue generation, Yasutaka described Colt’s ability to quantify connectivity spending by customers, a development that has driven strategic sales initiatives.

By segmenting its 27,000 global customers, Colt can tailor its engagement strategies, ensuring personalised and automated interactions as needed. “It’s absolutely different from using Excel spreadsheets,” he asserted, citing the synergy between intent signals and spending analysis.

Rohan Thareja of Microsoft explored AI’s broader potential, particularly generative AI (Gen AI), in transforming telco operations. He emphasised the dual challenges of operating in a highly regulated industry with razor-thin margins. AI, he noted, could offer solutions by optimising customer experience and reducing operational expenditure.

Thareja elaborated on Microsoft’s efforts to deploy Gen AI in predictive network maintenance. By integrating data from cell towers, networks, and servers into a unified data lake, telcos can proactively address issues before they escalate. He offered an example: “If there’s an event, like a Taylor Swift concert, AI can provide a hyper-personalised experience to avoid buffering issues.”

Phase one of this rollout involved customer 360 analyses to mitigate churn, a longstanding challenge for telcos. By understanding customer behaviour across multiple touchpoints—mobile, broadband, and cloud services—telcos can implement targeted marketing campaigns to retain customers. “It’s not just about being reactive but proactive,” Thareja stressed.

Patel steered the conversation towards the complexities of AI deployment across geographies, particularly in addressing regulatory requirements. Thareja acknowledged that differing regulations around data sovereignty complicate the implementation of AI workflows across regions. “Telcos understand the data they collect, but sharing it within or across industries is a challenge,” he noted.

Despite these hurdles, he identified cost optimisation in training AI models as the next frontier in the competitive landscape. “How can we bring down the cost of fine-tuning models? That’s where the race is now,” he said, underscoring the importance of efficiency in deploying AI at scale.

The panel also touched on security implications, a critical concern in AI-enabled networks. While details were not extensively covered, all participants acknowledged that maintaining customer trust and adhering to regulatory requirements remain non-negotiable. The panel discussion underscored AI’s transformative potential in the telco industry, from enhancing internal efficiencies to unlocking new revenue streams.

Wheeler’s emphasis on cautious implementation, Yasutaka’s customer-centric use cases, and Thareja’s vision for proactive network optimisation offered a holistic view of AI’s opportunities and challenges. As Patel concluded, the telco sector must strike a balance between innovation and regulation while leveraging AI to drive customer satisfaction and operational excellence.

With advancements in Gen AI and data-driven strategies, the telco of tomorrow promises to be smarter, more efficient, and more connected than ever.