Transforming Telecommunications:

How to Embrace AI at Scale

By Andre Truter, BSG Telecoms, Media and Technology Practice Leader

 

 

AI adoption in telecommunications is still in its initial stages, with a significant opportunity to accelerate towards scaled AI implementation. 

The United Nations Economic Commission for Africa predicts that AI technologies, including machine learning and natural language processing, are poised to substantially impact the African telecommunications sector, potentially adding US$1.5 trillion to the economy by 2030.  

However, the projected value of AI will only be realised once telco organisations are able to fully scale their AI implementations leveraging certain key success factors. 

 

AI Adoption in Africa 

 

A 2023 NVIDIA survey revealed that globally 90% of telco entities are engaged with AI, with 48% in the assessment or pilot stage and 41% actively implementing or using AI in their operations. In contrast, an IDC survey found that about only 16% of South African firms had adopted AI solutions by late 2023.  

This clearly indicates that the pace of AI adoption in the African telco sector is tracking well behind global levels, and that the current focus and investment in AI may not be sufficient while use-cases remain mostly in the proof-of-concept phase. 

 

AI Use Cases for Telcos 

 

Currently, as illustrated by the examples below, AI is being used in pockets within telco organisations across several use cases. 

 

AI USE CASE

 

Enhancing Customer Experience

 

 

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PRACTICAL EXAMPLE

 

The use of chatbots, such as TOBi at has streamlined customer service by handling quick queries and reducing the burden on call centres. Available 24/7, TOBi allows customers to get assistance at any time, thereby lowering operational costs.

 

AI USE CASE

 

 

Improving Operational Efficiency

 

 

 

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PRACTICAL EXAMPLE

 

AT&T is leveraging Azure OpenAI Service to enhance automation, boosting employee productivity, and customer service. By utilising Azure and AI technologies, the company can automate IT tasks and quickly respond to basic HR inquiries, resulting in greater efficiency, improved employee experience, and cost savings.

 

AI USE CASE

 

 

Network Optimisation with Predictive AI

 

 

 

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PRACTICAL EXAMPLE

 

Nokia leverages AI through its AVA Cognitive Services platform to predict anomalies and optimise real-time network performance. This proactive approach allows the network to actively manage performance, minimising downtime. As 5G and 6G networks emerge, AI will play a crucial role in network optimisation and management.

 

AI USE CASE

 

 

Strengthening Security and Fraud Detection

 

 

 

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PRACTICAL EXAMPLE

 

The use of AI in security and fraud detection has significantly helped organisations in identifying threats early. This is also true in the telco sector, as demonstrated by companies like Palo Alto Networks and AT&T, which utilise AI for cybersecurity. Palo Alto Networks employs AI to enhance its existing systems, improving the detection of phishing attempts, firewall failures, and other security risks.

The area where AI adoption has made a significant impact is enhancing customer experience. Generative AI use cases have been at the forefront of transforming customer interactions, leading to more personalised and efficient service delivery.

Although utilising AI to enhance customer service and experience can offer immediate and valuable benefits, it may not provide the most significant returns. Telco organisations should focus on a more balanced strategy, ensuring that significant AI value is realised by implementing AI across multiple use cases and business areas.

The opportunities presented by AI adoption in the telcos industry are diverse and far-reaching. Telco organisations can leverage AI to impact key areas of their business which not only improves revenue but also saves costs. Whether it's optimising network management, automating customer support, or predicting equipment failures, the potential for AI to streamline operations and drive business outcomes is immense. 

 

Journeying from Experimentation to Large Scale Adoption: The “How”

 

Earlier, we noted that many organisations are still in the experimentation phase of AI adoption. While this is a step in the right direction, the journey from experimentation to large scale adoption can be complex and some key considerations and success factors need to be kept in mind.

 

Out-of-the-Box vs. Fit-for-Purpose solutions

Many telco organisations select specific AI solutions without exploring all options. For instance, they might adopt a customer service platform with built-in AI capabilities, known as an "Out-of-the-Box" solution.

These solutions typically offer cost savings and quick implementation since the AI feature is included in the licensing fee. However, they can limit the telco's ability to maximise value, leading to fragmented, non-scalable approaches across different business units.

Exploring specialised tools and tailored solutions, like hyperscaler AI services, can achieve better outcomes despite seemingly being more complex to implement than Out-of-the-Box solutions.

Data management

Effective AI implementation in a telco organisation hinges on several critical data management considerations. Given the massive and diverse data streams telcos generate—ranging from structured and unstructured to real-time data—AI solutions must be robust enough to process these large volumes efficiently. Ensuring high data quality is another key consideration: the data must be accurate, complete, and current. Additionally, maintaining stringent data security, establishing strong data governance frameworks, and ensuring seamless data accessibility are vital to support successful AI deployments.

Partnerships and collaborations

Telco organisations should be leveraging their existing technology partnerships or entering new partnerships with global entities such as the hyperscalers, to bring in specialist knowledge or capabilities to deliver AI value at scale. The AI journey ahead does not need to be intimidating as collaborations and partnerships of this nature enable accelerated adoption beyond experimentation.

Organisational structures

For AI implementations to work at scale, telco organisations will need to rethink their existing organisational structures, moving away from the traditional hierarchical and siloed structures and transition into structures and roles that are centred around the new AI tools and solutions that will power their business.

AI skills

AI skills are critical to ensure the success of AI implementations. Telcos need to invest in continuous education and training programs to upskill their current workforce in various AI technologies. Partnerships with educational institutions and online learning platforms can provide access to specialised courses and certifications to suit specific skilling needs.

Organisational culture and change management

AI adoption will fundamentally change the way an organisation operates. These big transformations will require robust change management to ensure adoption and manage resistance to the change. Employees should be educated and involved in the transition, and feedback should be encouraged. It is paramount that the whole organisation is taken on the journey so that value can be realised across the business.

Tracking value realisation

AI experimentation is typically quick, easy, and inexpensive, and allows for fast demonstration of value. However, as scaling progresses, complexity and costs rise, potentially jeopardising the business case and reducing actual value. Tracking the value of AI implementation is crucial for successful scaling. Establishing the right measurement framework and metrics, such as revenue uplift, cost savings, or efficiency gains, helps monitor and report the value being realised as AI scales.

Ethical AI frameworks

The implementation of AI technologies brings immense potential but also significant ethical considerations. Key challenges include bias, data sufficiency and adequacy, and technology neutrality. An ethical AI framework is essential to ensure that AI systems are developed and deployed responsibly, transparently, and fairly. This framework helps telco organisations address biases, protect user privacy, ensure compliance with regulations, and maintain public trust.

 

Where to Start?

 

AI adoption in the telecommunications industry is not just a trend, but for businesses looking to thrive in the AI era.

Having key success factors in place is crucial to maximising AI value and moving towards scaled implementation. Of the factors discussed above, the most critical for accelerating towards this outcome include:

  • AI Solutions: Having a structured and holistic approach to selecting and implementing the most appropriate AI technologies.
  • Data: Access to and effective use of quality data to power AI implementation.
  • Partnerships: Collaborations that help scale and accelerate AI adoption.
  • Value Tracking: Effectively tracking value through a structured framework enables continued investment and an ability to keep scaling AI.

 

By truly embracing AI, telco organisations can position themselves at the forefront of innovation, delivering superior customer experiences, and unlocking new avenues for growth and success. The future of telecommunications is undeniably intertwined with the transformative power of AI, and the time to embrace this technology is now. Forging this path alone is an option, however having a partner ecosystem that enables rapid transition from strategy to execution at scale will accelerate the path to value in adopting AI.

 

Get on board or be left behind

The telecommunications industry is already competitive as it stands, and AI isn’t going anywhere. Contact BSG to discuss how we support with setting your organisation up with an effective AI strategy and drive successful implementation, adoption, and scale.

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