Telecoms operators will accelerate AI adoption to reduce direct and indirect staff costs

14 December 2023 | Strategy


After a lean period for profitability, telecoms operators will look to AI to change their fortunes, initially by reducing staff costs in areas such as customer services, HR and sales. 

Boards and shareholders are hungry for improved profitability, but existing assets require greater investment intensity, and offer paltry returns on that investment. 

The hyperbole around AI’s potential (with revolutionary technical breakthroughs appearing on a seemingly weekly basis) is slowly giving way to more measured understanding of how AI can benefit telecoms operators. AI technology in general (and GenAI in particular) is reaching the maturity to support widespread task automation. It offers a significant opportunity to enhance capabilities but reduce headcount, with consequent rapid growth in CSPs’ profitability. The significant reduction in headcount requirements will be seen first in sales teams (linked to the move to digital channels), moving to software development and network operation functions over the longer term. 

AI’s acceleration of the existing trend for headcount reduction will benefit operators’ profits, but also improve customers’ service experience. Identifying the right time and the right way to embrace this disruptive technological opportunity will make the difference between feast and ongoing famine.


Analysys Mason 2024 predictions for the TMT industry
Analysys Mason 2024 predictions for the TMT industry