Why the telecom sector is entering a new phase of stability, relevance, and strategic opportunity.

The telecom sector is entering a period of renewed stability and strategic opportunity, and Dario Talmesio’s keynote frames this shift with unusual clarity: after a decade of stagnation, operators are finally seeing growth, investor confidence, and a pathway to meaningful evolution in the AI era. The industry is not transforming at the pace of hyperscalers, but it is no longer contracting, and critically, it is once again generating record free cash flow. This combination of modest revenue growth, improving fundamentals, and expanding adjacencies is reshaping how telcos think about infrastructure, monetisation, and long‑term competitiveness.

Market recovery and the productivity challenge

Telecom revenues are growing at roughly 3% annually, and operators have delivered two consecutive years of record free cash flow. Capex is beginning to normalise after years of heavy fibre and 5G investment. Yet OPEX remains stubbornly flat in absolute terms, despite years of automation, workforce reductions, and energy‑efficiency gains. Talmesio highlights this as a structural weakness: AI is beginning to deliver value in customer care and early network analytics, but the industry has not yet unlocked the scale of productivity improvement that generative AI promises. Operators expect the biggest impact to come from network operations and analytics, but the gap between expectation and realised savings remains wide.

Fibre, home networks, and the shift beyond connectivity

Fibre deployment has reached maturity in many markets, with some countries approaching full FTTH coverage. As gigabit access becomes ubiquitous, operators are shifting from monetising pure bandwidth to monetising the in‑home experience. Wi‑Fi 6/6E/7 adoption is accelerating, and operators are increasingly charging for advanced gateways, mesh nodes, and value‑added services. Parental controls, cybersecurity, smart home security, prioritisation, and home energy management are emerging as meaningful revenue adjacencies. While connectivity remains the core business, the cumulative value of these “fringe” services is becoming significant, both in fixed and mobile environments.

5G SA, 5G‑Advanced, and the return of differentiation

After years of disappointment around 5G monetisation, the landscape is shifting. Standalone 5G is now commercially deployed by 66 operators, representing the majority of global 5G subscribers. The U.S. market is moving rapidly toward nationwide 5G SA, signalling a new phase of competitive differentiation.

Early monetisation examples are emerging in 5G‑Advanced, and RedCap is gaining traction as a practical enabler of new device categories. For the first time in years, operators have new pricing levers and service differentiation opportunities.

Telcos’ expanding role in the AI economy

Talmesio outlines three parallel AI strategies now taking shape:

• AI infrastructure: AI‑ready data centres, GPU‑as‑a‑service, AI‑enabled edge, and high‑capacity data‑centre connectivity.

• AI for productivity: internal efficiency gains and AI‑enabled enterprise solutions.

• AI‑powered software services: increasingly delivered through third‑party platforms, with some operators exploring homegrown capabilities.

These strategies reflect a broader shift: telcos are positioning themselves not just as connectivity providers but as foundational players in national AI ecosystems.

Sovereignty as a catalyst for diversification

The sovereignty agenda that once focused narrowly on data residency has expanded to include cloud infrastructure, sovereign AI, cybersecurity, quantum‑safe networks, satellite communications, and critical‑infrastructure protection. This trend is creating new opportunities for operators to enter markets previously dominated by hyperscalers or specialist vendors. In many countries, sovereignty has become one of the strongest drivers of telecom investment and policy alignment.