Telecoms in 2026: Will opportunities outweigh the challenges?

Details: Julian Bright; Category: Trends & Forecasts; 05 January 2026; 14095 views

The year ahead undoubtedly holds challenges for the telecoms industry, but progress on a number of fronts appears assured.

At the macro level, continued slow economic growth, tensions over global trade, fractured component supply chains and an increasingly uncertain geopolitical landscape, will continue to impact the business plans of service providers and the wider industry.

As service providers strive to transition their businesses for the digital services era, they will also face several more immediate choices in 2026, such as how to manage the delivery and monetisation of new services, address cybersecurity and regulatory pressures, and, not least, incorporate AI into their physical infrastructure and business processes.

On the upside, advances in technology and the drive towards next-generation networks capable of delivering greater efficiencies and lower costs, coupled with the promise of AI, should provide service providers with the platform to expand and develop an even more pivotal role as providers of intelligence-driven, locally relevant digital services for enterprises and consumers.

Global threats

In their predictions for 2026, industry commentators and analysts echo concerns over macroeconomic trends and global threats to the stability of the telecoms market.

Analyst firm Deloitte warns of increasingly fragile supply chains for next-generation AI chipsets with escalating trade restrictions on critical technologies, while in its list of 10 risks in the year ahead, accountancy firm EY identifies cost-of-living pressures through to supply chain disruption as continuing threats to telcos’ financial resilience and stability.

Juniper Research believes industry competition could reach an unprecedented inflection point in 2026, with the traditional role of mobile operators at risk of diminishing. Operators can be expected to “actively defend their role in connectivity, while emerging players continue to gain traction,”

Nevertheless, the year ahead will mark a strategic shift towards the development of scalable, enterprise-grade solutions, while improving consumer experiences will be a key focus aimed at driving adoption and enhancing customer retention across mobile services, says the analyst firm.

Meanwhile, telecom infrastructure is increasingly being viewed as a national strategic asset as regulation is impacted by geopolitics and economic nationalism, says EY. And in a research note, analysts at Omdia suggest that control of digital infrastructure for national security, economic stability and data protection is driving the concept of digital sovereignty as an opportunity for telecom operators.

Network fundamentals

The fundamental challenge of delivering fast, secure and reliable connectivity over state-of-the-art network infrastructure can be expected to remain the primary goal for operators and their supplier base in the year ahead.

Although primarily focusing on the AI challenge, vendors contributing to Developing Telecoms’ Global Forecast 2026 have also been at pains to stress the criticality of ensuring that service provider businesses are underpinned by the resilient, secure and future-ready digital infrastructure, processes and skills required to support the deployment of AI.

Operational and business support functions will be at the heart of these changes, and the need is for platforms that are open, flexible and capable of supporting a broader ecosystem, says Cerillion’s marketing director, Dominic Smith. At the same time, CSPs will need to monetise beyond connectivity services in 2026 according to Qvantel CMO, Jukka Heiska, and AI-driven solutions can help to market new services.

Both companies emphasise the need not only to employ key assets such as customer data and usage patterns to monetise these new services, but also the importance of developing large-language models to support regional and localised content rather than a single all-pervasive ecosystem.

However, EY reports that while more than half (58%) of telcos it surveyed believe it is essential to replace OSS/BSS systems, the timing and scope of transition to (AI-ready) digital support systems (DSSs) depend on a range of considerations including telcos’ cloud platform preferences, their degree of reliance on partners and systems integrators, and ambitions around monetising new services.

Delayed benefits

Emerging technologies such as standalone 5G, 5G-Advanced, Massive MIMO, gigabit fibre and even AI are already transforming the physical network, and the ability to harness a range of “frontier” technologies is becoming essential, says EY. However, these new technologies are posing fresh questions for telcos in terms of business resilience and service innovation.

In his predictions for 2026, Nvidia SVP of Telecommunications, Ronnie Vasishta,Nvidia SVP of Telecommunications, Ronnie Vasishta, stresses the need for deeper, more pervasive and distributed embedding of AI into the network and into network elements such as AI-RAN, while ZTE’s chief strategy and ecosystem expert Jason Tu advocates employing new network architectures and capabilities such as edge computing and green energy, spanning network, platforms and applications to drive digital inclusion.

However, the benefits of these new architectures may not materialise as soon as 2026, says Deloitte. And whereas the use of embedded GenAI in applications such as search engines will overtake standalone Gen AI, the move towards more inexpensive edge computing using cheaper, low-powered chipsets may take longer.

Not only will many of the benefits fail to materialise in 2026, the next phase of GenAI will likely require more computational power than previously, not less, warns the analyst firm.

Towards Rel-21 and beyond

In the drive for next-generation mobile standards in 2026, 3GPP says the journey from Rel-20 (5G-Advanced) to Rel-21 (6G) will represent a critical phase in its plans. Exploratory work on 6G will continue throughout the year alongside further progress on 5G-Advanced, with the Stage-2 (system architecture) aspects of Release 20 all-but completed by June, and reaching final freeze in September.

The Release 21 timeline, which is expected to produce the first formal 6G technical specifications, should be finalised no later than June 2026. It will set the timeframe for what 3GPP believes will be an inflection point for the industry, and an influence on global standards for years to come.

Satellite growth continues

Satellite connectivity, meanwhile, can expect to see further growth in 5G coverage and direct-to-device services in 2026. As of end-2025, SpaceX reported that its Direct to Cell (D2C) service was in operation across 22 countries with more than six million monthly customers, while NB-IoT provider Sateliot is planning to launch five new LEO satellites in 2026 as part of its drive to provide global narrowband 5G connectivity.

The expansion of satellite constellations shows no sign of slowing, according to Juniper, with Starlink, Amazon’s Project Kuiper and a group of Chinese satellite providers having ambitious launch programs in 2026 and beyond, in addition to continuous investment programs by incumbent satellite providers such as Viasat and Eutelsat, as well as OneWeb.

Rising investment will see between 15,000 and 18,000 low-earth orbit satellites connecting over 15 million global subscribers by the end of 2026, says Deloitte, including around 1,000 Direct-to-Device (D2D) satellites providing low-bandwidth connectivity in areas that may lack terrestrial cell coverage.

However, satellite services will often face monetisation hurdles, with adoption and willingness to pay for services uncertain, meaning monetisation and business models for D2D are still unclear, says Deloitte. Nor may new LEO providers choose to partner with terrestrial telcos as some other satellite providers are doing, instead choosing to provide low-cost monthly broadband services that may disrupt emerging-market telcos.

AI choices will be critical

The year ahead promises continued and significant progress with the incorporation of new technologies, platforms and business processes across the industry, driven not least by the wider penetration of AI.

How, where and when to introduce AI will be a critical decision for service providers, and one likely to impact their businesses beyond 2026 and well into the era of 6G.