Perspectives from the Global Telecom Outlook 2023–2027

The global telecom industry faces rising data demands, particularly for video, while revenues grow only modestly. Telcos are seeking new revenue streams beyond connectivity, such as content, IoT, and private 5G networks for businesses, while also needing to make heavy investments in network infrastructure. Collaboration across the telecom ecosystem will be critical as telcos work to innovate and capitalize on growth opportunities amid a complex, competitive environment. Key strategies include developing vertical expertise, ecosystem management capabilities, and a focus on selling solutions and as-a-service offerings to thrive in the evolving telecom landscape.

## Headings / Titles:

1. Perspectives from the Global Telecom Outlook 2023–2027
2. The consumer remains at the centre as demand for data rises
3. Driving business adoption in the internet of things
4. Network evolution shapes the future of the telecom industry
5. Conclusion: Enabling ecosystems
6. Methodology and definitions
7. Global Telecom Outlook territory contacts
8. Contributors

## Key Takeaways:

- The global telecom industry is facing rising demands and strategic challenges as data consumption, particularly for video, surges while revenues grow only modestly.
- Telcos are seeking new revenue streams beyond connectivity, such as content, IoT, and private 5G networks for businesses, while also needing to make heavy investments in network infrastructure.
- Collaboration across the telecom ecosystem will be critical as telcos work to innovate and capitalize on growth opportunities amid a complex, competitive environment.

## Summary:

This document provides an in-depth look at the global telecom industry's outlook for 2023-2027, highlighting the key trends, challenges, and strategic paths forward for companies in this sector.

The telecommunications industry is facing a fundamental strategic challenge as it seeks to sustain growth and outcomes in the face of rising demands, particularly for data-heavy services like video. Global data consumption over telecom networks is projected to nearly triple from 2022 to 2027, driven largely by video traffic. However, revenues from internet access are only expected to grow modestly at a 4% CAGR during this period, as providers appear to have little pricing power on increasingly commoditized connectivity and data services. 

At the same time, telcos must make heavy investments in their network infrastructure, with capex projected to reach $342.1 billion in 2027 alone as they continue the transition to 5G and newer technologies. This sustained high level of investment intensity will put ongoing pressure on telcos' financing and debt levels, maintaining their focus on improving operational efficiency, boosting monetization, and controlling costs.

In the consumer space, telcos are seeing demand driven primarily by evolving user preferences and the proliferation of data-hungry devices, especially for video and gaming. While cellular data will be the fastest-growing category, there are significant geographic variations, with India poised for a surge in 5G-enabled service development and innovation. Telcos are also seeking to diversify beyond just connectivity revenues, looking to stake a claim in content subscriptions, IoT applications, and other adjacent areas.

On the business side, IoT adoption is increasing across industries, but revenues have seen only linear growth so far due to constraints in both supply and demand. To drive greater IoT business adoption, telcos are looking to partner across ecosystems with software, cloud, and integration providers to develop more effective and scalable solutions. Private 5G networks for enterprises are also emerging as a key opportunity.

In terms of network evolution, 5G will become the leading smartphone connection type globally by 2025, and fiber deployment is also continuing to pick up. However, the rate of growth in both fixed and mobile broadband investment is expected to decline through 2027 as higher inflation and interest rates instill greater caution. Telcos are exploring strategies like mergers, neutral host networks, and partnerships to pool resources and share the burden of investing in the integrated, scalable 5G networks that customers need.

Ultimately, the document concludes that significant investment and collaboration within the broader telecom ecosystem will be required for companies to innovate and capitalize on the evolving opportunities in this complex, competitive industry. Those that can develop vertical expertise, ecosystem management capabilities, and a focus on selling solutions and as-a-service offerings will be best positioned to thrive.