Telcos must pivot AI from operational efficiency to revenue monetization

The shift from 'cost-center AI' to 'revenue-generating AI' represents a critical strategic pivot for telcos facing stagnant ARPU. By standardizing the integration of satellite and terrestrial networks via the SODA framework, operators can capture a multi-billion dollar market in underserved regions and specialized IoT applications. Within the broader streaming ecosystem, this ubiquitous, intelligence-backed connectivity is essential for the reliable delivery of high-bandwidth video and real-time data to edge devices. Watch for the commercial adoption of the ODA for Satellite (SODA) framework as a signal that hybrid terrestrial-orbital networks are moving toward large-scale, interoperable deployment.

The push toward AI-native operations, often termed 'TelcOS,' is gaining momentum as carriers confront a widening gap between soaring data traffic and flat consumer willingness to pay. Per PwC’s Global Telecom Outlook (March 2026), global telecom service revenue is expected to reach $1.32 trillion by 2029, yet capital expenditure intensity remains high as operators prepare for 5G-Advanced and 6G. This economic pressure is driving a shift toward autonomous networks, which are projected to reach an $11.38 billion market size by 2026, according to Mordor Intelligence. Tier-1 operators like Telefónica and Orange have already demonstrated operational cost reductions of 25% to 40% through AI-guided automation.

Recent industry activity underscores the urgency of integrating non-terrestrial networks (NTNs) into standard telco architectures. In June 2026, TM Forum officially launched the ODA for Satellite (SODA) project with 16 foundational partners, including Airbus, Terrestar Solutions, and Vodacom. This project aims to resolve fragmented operating models and incompatible billing systems that have historically stifled satellite-telco integration. The move coincides with reports from Juniper Research suggesting direct-to-device satellite users could reach 133 million by 2031, provided that operators can move past current technical silos.

Furthermore, the emergence of 'Physical AI'—where intelligence is embedded into robotic systems and autonomous machines—creates a new tier for monetization. At DTW Ignite 2026, ZTE and China Telecom received the Outstanding Catalyst award for their robotic dog project, which functions as an edge-computing brain. Rather than selling simple data buckets, telcos are now positioning themselves to sell 'intelligence-as-a-service,' using AI orchestration to manage everything from drone inspections to automated logistics. This transition is backed by a surge in spending, with 89% of telcos planning to increase AI budgets in 2026, per NVIDIA’s State of AI in Telecommunications report.