Telecom operators are accelerating capital investment in AI infrastructure as demand for AI compute capacity surges and national data sovereignty requirements increasingly favor local providers, according to Omdia’s new report.
The shift is opening up new growth opportunities for telcos, positioning them as critical players in national and regional AI ecosystems rather than passive connectivity providers.
Omdia notes that large-scale public initiatives, such as the European Union’s planned AI Gigafactories, are creating opportunities for telcos to lead major infrastructure programs instead of ceding control to hyperscalers. With established networks, local presence, and regulatory alignment, telcos are well placed to support sovereign AI ambitions.
AI Infrastructure Monetization Gains Momentum
Monetization of AI infrastructure investments is already beginning to materialize. In South Korea, SK Telecom reported that data center revenue accounted for 4 percent of its total revenue in the third quarter of 2025, with ambitions to reach KRW 1 trillion in data center and AI-related revenue by 2030.
Similarly, Ooredoo expects digital infrastructure to contribute 12 percent of group revenue by 2030, up from just 3 percent in 2025, reflecting a strategic pivot toward higher-value infrastructure services.
Iliad (France) announced an investment of €3 billion (US$3.1 billion) for AI infrastructure expansion across Europe via its OpCore subsidiary. This investment focuses on expanding data center computing capacity to support AI workloads.
India’s major telecom firms plan to invest more than ₹1 lakh crore (~US$12 billion) over the next two to three years in AI-ready data centers, cloud and edge infrastructure to support AI workloads and enterprise services — marking a major shift from legacy network capex, Economic Times reports.
SK Telecom (South Korea) has not disclosed a precise AI-specific capex figure, but it has redirected a meaningful share of its capex budget toward AI data centers, GPU-as-a-Service, and related compute infrastructure. Omdia notes this shift reflects multi-year capex commitments to AI infrastructure.
SoftBank (Japan) capex showed an approximate 12.7 percent increase, driven by investments in AI workloads, cloud platform buildouts and new data-center infrastructure, indicating substantial allocation toward AI infrastructure.
Bharti Airtel (India) is expanding AI-ready data center capacity (Nxtra) with targeted capex (e.g., ₹5,000 crore expansion to 400 MW in late 2024), part of larger enterprise-focused infrastructure spending — even though AI-specific breakdowns are not separately disclosed.
These early results underscore how AI-driven infrastructure can diversify telco revenue beyond traditional connectivity and offset slowing growth in core telecom services.
Multi-Year Capex Commitments Across Regions
Omdia’s analysis shows that telcos are scaling AI infrastructure through multi-year capital expenditure commitments across Asia, Europe, Canada, and the Middle East. Investments span cloud platforms, hyperscale and edge data centers, GPU as a Service offerings, and AI-enabled radio access networks.
AI infrastructure is becoming a long-term pillar of telco investment strategies. Many operators are allocating significant capital to build the compute and storage capabilities required to support enterprise AI workloads, public sector initiatives, and next-generation network intelligence.
Diverse Investment Models Reflect Varying Risk Profiles
There is no single blueprint for AI infrastructure investment. Approaches vary in structure, scale, and risk appetite. Some telcos have created dedicated infrastructure subsidiaries to accelerate execution and attract external customers. Examples include STC’s Center3 and Iliad’s Scaleway, both designed to operate with greater flexibility than traditional telecom units.
Other operators are pursuing joint venture models, as seen with SingTel, to share risk and expertise with partners. For groups such as SKT, SoftBank, and Ooredoo, AI infrastructure investments are part of a broader strategic reorientation toward digital platforms and technology services.
In some cases, Omdia observes a structural rebalancing of capital allocation, with reduced capex directed at legacy connectivity and a greater share channeled into AI, cloud, and data center assets.
Sovereignty and AI Traffic Drive Strategic Shift
According to Omdia, the combination of growing AI-related traffic and national sovereignty initiatives is reshaping the competitive landscape. Governments and enterprises increasingly prefer local AI infrastructure to meet regulatory, security, and latency requirements, creating a natural advantage for domestic telecom operators.
Julia Schindler, Principal Analyst, Strategy at Omdia, said AI infrastructure has become a strategic bet for telcos. She noted that the convergence of AI demand and sovereignty-driven policies presents a unique window of opportunity that more operators are likely to pursue in the coming years.
As AI adoption accelerates across industries, telcos that successfully scale and monetize AI infrastructure stand to reposition themselves at the center of national digital economies, moving beyond connectivity to become foundational providers of sovereign AI and cloud services.
BABURAJAN KIZHAKEDATH
