Telefónica is propelling itself into the AI-era with a determined focus on transforming its network to boost revenues. During a keynote at the Network Operator Summit at OFC, the company’s Chief Technology Officer, Cayetano Carbajo Martin, shared their comprehensive strategy. This approach aims to overcome longstanding revenue stagnation that has affected many telecom operators despite growing network traffic.
Central to Telefónica’s approach is a shift towards automation, a significant transport network overhaul, and embracing coherent pluggable optics. Automation plays a pivotal role in this strategy. By 2030, Telefónica aims to achieve Level 4 network autonomy. This goal falls under the Autonomous Network Journey program launched in 2021. Martin noted, “We are trying to implement the technical lever for increasing our revenue.”
Automation promises to reduce manual errors and operational costs. Telefónica plans to utilize open interfaces and disaggregation to advance this agenda. Martin emphasized the potential of open interfaces and software-defined networking (SDN) in facilitating seamless AI integration. In application, AI will enhance processes, from automated root cause analysis to digital twin creation, while safeguarding data privacy through federated learning.
In tandem, Telefónica’s transport network is set for a major upgrade. The company is transitioning its backbone to 400G and backhaul to 100G, driven by the need for higher speeds. Furthermore, by 2027, 60% of the company’s optical capacity will transition to IP over DWDM (Integrated Packet over Dense Wavelength Division Multiplexing). Martin noted, “Such a big increase in speed is needed even in those operations where we have only mobile access, and for sure where we have fixed access.”
The move towards IPoDWDM has gained traction in the industry. It offers enhanced bandwidth efficiency, scalability, and cost reductions—key for AI-enabled applications with high-speed transmission demands. Although the transition faces cultural and commercial challenges, Martin underscored the importance of leveraging this progress for operational advantage, highlighting, “There are a lot of barriers, some cultural and other commercial for doing so, but I think as operator, we have to take advantage of this progress and use IP over DWM.”
Telefónica’s initiative is a bold step toward capitalizing on AI-related opportunities in telecommunications. By addressing network autonomy and embracing modern transport technologies, the company aims to create a more efficient, cost-effective operation that will ultimately drive new revenue streams in the AI-driven telecom landscape.
