How AI is Transforming Telecommunication?

Updated on: 3 May, 2023
How AI is Transforming Telecommunication?

Artificial Intelligence (AI) is transforming workflows in every sector and unveiling a new dimension of business operations. It has accelerated the pace of digital transformation across every industry, and the telecommunication industry is no exception. By the end of 2027, the application of AI in the telecommunication market has been forecasted to reach an impressive $14.99 B globally.

AI in telecommunication market report 2027

Data Source: Valuates Report

The demand for AI in telecommunication has risen significantly with the advent of 5G technology. As the demand for AI integration grows at a phenomenal place, its future in the telecom industry seems to be only getting brighter.

The telecommunication industry serves as the backbone of business communication worldwide. As growing customer demands put pressure on the sector, the implementation of AI has enabled the telecommunication sector to deliver smarter services, faster.

Why is there a surge of interest in AI among telecoms?

Businesses aren’t bound by geographical borders anymore. What’s more, global communication traffic has also grown exponentially. In such a scenario, the telecommunication industry has to equip itself with a digital transformation strategy that can overcome the emerging challenges of the current business landscape. Some of the dominant challenges in the telecom industry include:

Why is there a surge of interest in AI among telecoms

  • Network Management

As communication networks expand all around the globe, it has become difficult to control the complexity of network management. The amount of network equipment is rising and so is its price. Network management has become expensive as well as complicated.

  • Data Analysis

Data has become the fuel of the economy and organizations are striving to harness the power of data in all possible ways. The telecommunication industry has collected large volumes of data. But unfortunately, they are struggling to structure, categorize and cleanse this data, in order to drive useful insights.

  • Expense

The telecom industry requires huge investments to equip itself with the right infrastructure, that will help to advance on the road to digitalization. As per a survey, the global operating expenditure of the telecommunication industry is forecasted to increase by billions of dollars, which might push them into a financial crunch.

  • Market Saturation

With multiple reputed players in the telecommunication market, customers are spoilt for choice. Also, today’s customers have specific demands for business communication. Therefore, they are likely to switch vendors when their expectations are not met.

AI is emerging as a key factor that can help the telecommunication industry overcome these challenges. The application of AI in telecommunication provides the capability to optimize and automate network management while reducing operational costs. Therefore, most telecommunication companies are racing to gain a competitive edge through the adoption of AI. 

How is AI transforming telecommunication?

Artificial Intelligence in the telecommunication industry has exhibited remarkable business outcomes. Therefore, more and more telecom companies are investing and focusing on this front, and it has become an essential investment for communication service providers (CSPs). The most important aspect of AI in telecommunication is that it helps overcome several industry challenges.  Let’s look at some areas where AI is making a significant impact.

How is AI transforming telecommunicationPredictive maintenance

Telecommunication network expansion requires sophistication and meeting this demand has become increasingly difficult. Artificial Intelligence helps in overcoming this challenge by driving accuracy in predictions. AI coupled with ML algorithms makes a huge difference in predictive maintenance. By analyzing historical data, enterprises can identify specific patterns that enable them to predict and warn about possible hardware failures. Therefore, AI in telecommunication serves as a dominant factor to alleviate equipment maintenance. It also helps fix issues by predicting them before they occur, thereby saving time. These benefits have a huge positive impact on user experiences.

In case of any technical or system failure, AI and ML algorithms can detect the cause and help fix the problem. Such an approach enables companies to prevent service interruptions and downtimes, which may otherwise negatively impact the customer experience. The application of AI and ML in predictive analysis helps CSPs derive better business insights that can be used to improve margins, identify the lifetime value of customers, optimize pricing, etc. 

Virtual assistants and chatbots

Conversational AI platforms are one of the most common applications of AI in telecoms. With automated personalized conversation, AI can transform the customer service experience. It not only cuts down waiting time for customers but also enhances self-service capabilities.

With this application of AI in telecommunication, businesses can streamline their customer service. It enables them to speed up customer service, thereby empowering enterprises to handle massive volumes of customer requests daily. Another advantage of chatbots or virtual assistants is that they can provide uninterrupted service 24*7*365. 

Today, most companies are investing in chatbots to increase their ROI. As AI technology evolves, chatbots are more likely to replace human operators for customer service in the future. Virtual assistants are expected to develop to such an extent that they can help customers resolve complex queries.

Fraud detection and prevention

As businesses explore cyberspace, they are also understanding the significance of fraud prevention. Malicious attacks on organizations can cause losses, to the tune of over $3.6 billion annually. This has led to a boom in the fraud detection and prevention market, that reached $20.98B in 2020.

The application of Artificial Intelligence to prevent such losses has exhibited positive results. Fraud analytics uses the analytical capabilities of AI to detect suspicious activities and immediately block the user, thereby preventing fraud.  The telecommunication market is harnessing this AI capability to combat fraudulent activities. This application of AI in telecommunication helps in fraud prevention by filtering and blocking fake profiles and unauthorized network access. It saves businesses from fraudulent activities, as well as minimizes the damage of any malicious attack.

Transform your telecommunication solution with Artificial Intelligence. To know how?

Robotic process automation (RPA)

Several industries are implementing AI automation to streamline their workflow and reduce workload. The telecommunication industry handles a large volume of data and manual data entry can cause errors.  Robotic Process Automation (RPA) utilizes AI technology to minimize these errors while streamlining important operations such as data entry, order processing, billing, and other back-office processes. Consequently, this application of artificial intelligence in the telecommunication industry brings greater efficiency.

RPA also manages repetitive, manual back-office operations, which drives added value to businesses. It reduces mundane workloads, leaving the CSP staff to focus on their core business. 

RPA automates workforce management, billing, and the execution of time-consuming and labor-intensive processes, helping businesses improve accuracy. According to a report by Statista, the RPA market is expected to expand to $13B by 2030. It also states that RPA will achieve almost universal adoption in the next five years. RPA has the capability to substantially transform cognitive computing for all industries, including the telecommunication industry.

Network Optimization

As the number of networks expands, the telecommunication industry requires network optimization in order to reduce downtime and ensure uninterrupted communication. The application of artificial intelligence in the telecommunication industry had helped CSPs ensure stable network performance for their users. It utilizes AI algorithms to build self-optimizing networks (SONs) that proactively detect network anomalies and fix them. 

AI in telecommunication has impacted network performance in a significant way. Today, more and more companies are investing in the implementation of AI for network optimization. According to IDC, 63.5% of telecom companies have already invested in the application of AI for improving their network infrastructure.

Revenue Growth

AI has the capability to drive actionable insights by analyzing bulk data. The telecommunication industry collects millions of data daily through different sources such as devices, networks, geolocation, mobile applications, service usage, detailed customer profiles, and billing. AI in telecommunication unifies all the data to derive insights that can be leveraged in various ways. For instance, by predicting customer behavior from analytics, businesses can strategize upselling and cross-selling. With access to real-time data and AI analytics, CSPs can grow their revenue by channeling customers into the buyer journey through the display of the right offers at the right time, using the right channel. CSPs can also increase the average revenue per user (ARPU) and the subscriber growth rate by leveraging AI analytics.

The Future of AI in the Telecom Industry

CSPs have fetched multiple advantages with the application of AI in the telecommunication market. It has helped them to manage, optimize and maintain infrastructure as well as improve customer support operations. AI in telecommunication has enabled them to leverage technology for network optimization, predictive maintenance, and fraud prevention. Moreover, it has opened the possibility of generating new revenue streams through smart upselling and cross-selling. In a nutshell, AI has helped CSPs to drive added business value. Moreover, AI has helped the telecommunication market to overcome major challenges by reducing the complexity of networks and cost-reduction on heavy equipment.

As technology evolves with big data tools and applications, the future of Artificial Intelligence in the telecommunication industry is predicted to glow brighter while building on itself to provide future-proof solutions. The application of AI in telecommunication can drive business growth for companies even in this cut-throat market. By embedding AI at the heart of business processes, the telecom industry has the potential to flourish and maximize its revenue while benefiting other businesses to achieve shared success.

Artificial Intelligence is shaping the future of the telecom Industry. Get a customized AI solution today!

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