The Strategic Role of Telecom Providers Across the AI Value Chain

Telecommunications companies (telcos) are at a structural inflection point where AI and geopolitics are shifting the demand for compute, data, and trust. The report proposes three strategic pathways: the 'modern telco' (optimizing core connectivity), the 'AI techco' (providing AI-powered managed services), and the 'national sovereign champion' (building compliant, in-country AI stacks). While telcos have historically struggled to capture value compared to digital platforms—with a post-tax ROIC of approximately 8% versus 27% for platforms in 2025—AI offers a chance to reset this trajectory. Key opportunities include AI-first connectivity, GPU-as-a-service (GPUaaS), and sovereign AI infrastructure, the latter of which is projected to see global spending reach $1.5 trillion by 2028.

• Telcos have historically failed to capture value commensurate with their role as infrastructure providers, with a 2025 post-tax return on invested capital (ROIC) of approximately 8%, significantly lower than the approximate 27% achieved by digital platforms.
• The 'modern telco' pathway focuses on protecting the core connectivity business by evolving networks into cloud- and AI-native architectures to deliver predictable, experience-led performance through plays like AI-first connectivity and data centre interconnect (DCI).
• The 'AI techco' pathway allows operators to grow through AI-powered managed services, such as Network-as-a-Service (NaaS) and GPU-as-a-Service (GPUaaS), moving beyond reliance on subscriber growth.
• The 'national sovereign champion' pathway aligns telcos with government resilience strategies to deliver in-country AI infrastructure, platforms, and governance to ensure data residency and security.
• Data centre interconnect (DCI) is identified as a high-value, high-feasibility opportunity, with global revenue projected to grow at a 10.9% CAGR to reach $5.5 billion by 2029.
• GPU-as-a-Service (GPUaaS) is characterized as a 'frontier bet' with high value potential but low feasibility due to extreme capital intensity and strong competition from hyperscalers.
• Telcos are uniquely positioned to provide AI security and safety by acting as an integration and assurance layer, leveraging their end-to-end visibility of network traffic and data flows.

APA

World Economic Forum (2026). The Strategic Role of Telecom Providers Across the AI Value Chain. https://reports.weforum.org/docs/WEF_The_Strategic_Role_of_Telecom_Providers_Across_the_AI_Value_Chain_2026.pdf

Chicago

World Economic Forum. The Strategic Role of Telecom Providers Across the AI Value Chain. 2026. https://reports.weforum.org/docs/WEF_The_Strategic_Role_of_Telecom_Providers_Across_the_AI_Value_Chain_2026.pdf.

Wikipedia

{{cite report |author=World Economic Forum |title=The Strategic Role of Telecom Providers Across the AI Value Chain |date=March 2026 |url=https://reports.weforum.org/docs/WEF_The_Strategic_Role_of_Telecom_Providers_Across_the_AI_Value_Chain_2026.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldeconomicforum2026strategic, author = {{World Economic Forum}}, title = {{The Strategic Role of Telecom Providers Across the AI Value Chain}}, institution = {World Economic Forum}, year = {2026}, month = mar, url = {https://reports.weforum.org/docs/WEF_The_Strategic_Role_of_Telecom_Providers_Across_the_AI_Value_Chain_2026.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }