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Generative AI in Telecom Market Size

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The Role of Sovereign Cloud Deployments for AI Adoption in Telco Networks

Report | 1Q 2025 | AN-6291

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As the chart above shows, Gen AI adoption in telco networks is projected to grow to US$47 billion by 2029. Deployed mainly for Business Support Systems (BSSs), these early implementations rely on third-party Large Language Models (LLMs) residing in the public cloud. As telcos look to expand their (Generative) AI solutions to more critical applications, like Operational Support Systems (OSSs), the demand for data sovereignty—fueled in part by continuing geopolitical tensions—will grow. Sovereign clouds will play a key role in mitigating risks, particularly for highly sensitive AI-driven workloads, such as real-time network optimization, AI-powered security threat detection, and regulatory-compliant customer interactions.

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