APAC Operators Focus on AI, Fintech, and Cybersecurity for Future Growth: The Rise of AI-Native Telecoms

Key Takeaways

Over 52% of telco executives see mobile payments and financial services as major growth opportunities.
62% of respondents identified cybersecurity services as a key area for B2B revenue growth.
68% prioritized AI enablement to support sales, marketing, and customer service as essential for revenue growth.

Growth Opportunities in Asian Telcos

A recently released report by TM Forum outlines significant growth areas for telecommunications companies (telcos) in the Asia Pacific region. The study reveals that operators are moving away from traditional pay-TV and video services towards innovative sectors like AI-related services, mobile payments, and cybersecurity.

In the survey, over 52% of 40 executives from 28 telcos stated that mobile payments and financial services present a “significant opportunity” for revenue growth. This figure closely follows core services: 59% identified mobile broadband and 54% noted fixed broadband as major growth prospects. Smart home technologies and consumer Internet of Things (IoT) applications were highlighted by 44% of respondents, while initiatives in consumer AI services, like SK Telecom’s A-dot personal assistant, were also recognized.

For B2B revenue generation, nearly two-thirds (62%) of respondents pointed to security-as-a-service as a notable growth opportunity. Operators are exploring partnerships, acquisitions, and white labeling to unlock new cybersecurity revenues. Japan’s KDDI, for instance, has recently acquired cybersecurity firm LAC to enhance its service portfolio.

Additionally, opportunities in sovereign AI, cloud computing, and AI infrastructure were affirmed, with operators such as SK Telecom and Singtel making investments in these areas. Other technologies like network slicing are viewed differently, with 29% of respondents seeing it as significant, while 25% downplayed its potential. A similar divide exists regarding network-as-a-service, with 31% considering it a growth opportunity.

Satellite-enabled services have gained attention, with about a quarter of Asia’s telcos recognizing mobile satellite services as significant, despite over 40% labeling them as minor. Partnerships, like KDDI’s deal with SpaceX for direct-to-device services, illustrate this interest.

Investment in technology and networks is also critical for growth. A significant 68% of respondents emphasized that AI enablement in sales, marketing, and customer service is “extremely important.” Other priorities include network automation (57%), BSS transformation (51%), and composable IT architectures (50%), all considered more urgent than traditional 5G investment.

Dean Ramsay, a principal analyst at TM Forum, noted a shift among operators to expand revenue beyond traditional connectivity. He articulated that AI, automation, and open IT architectures are vital for sustainable growth, suggesting that open digital frameworks are essential for modernizing systems and automating operations.

The report also indicates that operators are striving to revitalize their offerings in a stagnating market, mirroring trends observed in the global telecom sector where B2B and B2C service revenues are projected to grow by 3% in 2024, even as inflation remains high.

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