Global telecom leaders join forces to redefine the industry with network APIs

Rhea-AI Summary

Global telecom leaders, including América Móvil, AT&T, Bharti Airtel, Deutsche Telekom, Orange, Reliance Jio, Singtel, Telefonica, Telstra, T-Mobile, Verizon, Vodafone, and Ericsson, have announced a new venture to combine and sell network Application Programming Interfaces (APIs) globally. This landmark agreement aims to accelerate the adoption and innovation of network APIs, creating new monetization opportunities for the industry.

The venture will provide network APIs to a broad ecosystem of developer platforms, including hyperscalers, CPaaS providers, System Integrators, and Independent Software Vendors. Vonage and Google Cloud will partner with the new company, providing access to their ecosystems of millions of developers. The closing of the transaction is expected in early 2025, subject to regulatory approvals. Ericsson will hold 50% of the equity, while telecom providers will hold the remaining 50%.

Positive

• Creation of a global platform for network APIs, potentially opening up new revenue streams for telecom operators
• Partnership with major tech companies like Google Cloud and Vonage, providing access to millions of developers
• Potential for accelerated innovation in digital services across various sectors
• Equal equity distribution between Ericsson and telecom providers, ensuring balanced interests

Negative

• Transaction closing not expected until early 2025, indicating a long wait before potential benefits materialize
• Regulatory approvals still pending, which could potentially delay or alter the venture
• Potential challenges in integrating multiple telecom operators' APIs and ensuring seamless functionality across different networks

Insights

Financial Analyst

This landmark agreement represents a significant business opportunity for telecom operators and Ericsson. By combining network APIs globally, they're creating a new revenue stream and potentially disrupting the current telecom business model. The venture could lead to increased monetization of network capabilities and drive innovation in digital services.

However, the financial impact remains uncertain. The venture's success depends on developer adoption and the creation of valuable use cases. While the potential is huge, it's too early to quantify the revenue potential. Investors should monitor key metrics like API adoption rates and revenue per API call once the venture launches in early 2025.

The equal ownership structure (50% Ericsson, 50% telecom operators) suggests a balanced approach to risk and reward sharing. This could lead to strong alignment of interests but may also result in slower decision-making processes.

Tech Expert

This initiative marks a pivotal shift in the telecom industry's approach to innovation. By standardizing and globalizing network APIs, the venture addresses a longstanding barrier to developer access to advanced network capabilities. This could catalyze a new wave of applications leveraging 5G networks' full potential.

The adoption of CAMARA APIs, an open-source project, is crucial. It ensures interoperability and reduces fragmentation, which has historically hindered innovation in telecom. The partnership with Google Cloud and Vonage adds significant value, providing access to millions of developers.

However, challenges remain. Ensuring security and privacy across multiple networks and maintaining consistent performance will be critical. The success of this venture could reshape the telecom industry's role in the broader tech ecosystem, potentially positioning operators as more central players in the digital economy.

Market Research Analyst

This venture represents a strategic shift in the telecom industry, aiming to capture value from the growing API economy. By creating a unified platform, telecom operators are positioning themselves to compete more effectively with over-the-top (OTT) service providers and hyperscalers.

The market potential is significant. As 5G networks mature, demand for advanced network capabilities in areas like IoT, edge computing and AI is expected to grow rapidly. This venture could tap into these trends, creating new revenue streams for telecom operators.

However, execution risks exist. The success of the venture depends on its ability to attract developers and create a vibrant ecosystem. Competition from existing API providers and potential regulatory scrutiny over data privacy and network neutrality could pose challenges. Investors should monitor developer adoption rates and the types of applications being built on the platform as key indicators of the venture's success.

• Landmark agreement to accelerate adoption and innovation of network APIs includes a newly formed company that will drive new monetization opportunities for the industry.

STOCKHOLM, Sept. 12, 2024 /PRNewswire/ -- Today, some of the world's largest telecom operators, including América Móvil, AT&T, Bharti Airtel, Deutsche Telekom, Orange, Reliance Jio, Singtel, Telefonica, Telstra, T-Mobile, Verizon and Vodafone, together with Ericsson (NASDAQ: ERIC) are announcing a new venture to combine and sell network Application Programming Interfaces (APIs) on a global scale to spur innovation in digital services. Network APIs are the way to easily access, use and pay for network capabilities. The venture will drive implementation and access to common APIs from multiple telecom service providers to a broader ecosystem of developer platforms.

Modern mobile networks have advanced and intelligent capabilities, which have historically been inaccessible to developers. Additionally, it has been impractical for developers to integrate the different capabilities of hundreds of individual telecom operators. The newly formed company will combine network APIs globally, with a vision that new applications will work anywhere and on any network, making it easier and quicker for developers to innovate.

Easily accessible advanced network capabilities will open up the next frontier in app development and empower developers to create new use cases across many sectors. These could include anti-fraud verification for financial transactions and the ability to check device status so streaming providers can dynamically adjust video quality.

The newly formed company will provide network APIs to a broad ecosystem of developer platforms, including hyperscalers (HCPs), Communications Platform as a Service (CPaaS) providers, System Integrators (SIs) and Independent Software Vendors (ISVs), based on existing industry-wide CAMARA APIs (the open-source project driven by the GSMA and the Linux Foundation). Vonage and Google Cloud will partner with the new company, providing access to their ecosystems of millions of developers as well as their partners. The new venture shareholders will bring funding and important assets, including Ericsson's platform and network expertise, global telecom operator relationships, knowledge of the developer community and each telecom operator's network APIs, expertise and marketing. 

Additional telecom operators are encouraged to join the new company, further driving the industry and developer experience, and allowing all participants to tap into a significant new revenue opportunity, such as telecom operator Three Sweden (Hi3G Access) which is already in discussions.

Closing of the transaction is expected early 2025, subject to regulatory approvals and other customary conditions. Upon closing, Ericsson will hold 50% of the equity in the venture while the telecom providers will hold 50% in total. Built on a deep understanding of developer and enterprise needs and in keeping with the industry-body GSMA Open Gateway principles, the new venture's platform and partner ecosystem will remain open and non-discriminatory to maximize value creation across the industry.

Quotes from the partners:

América Móvil

Daniel Hajj, Chief Executive Officer, AMX: "We are very excited to join Ericsson and other key players in our industry in this innovative global platform initiative that will benefit the digital ecosystem as a whole. New API solutions will establish exciting value-added offerings to our customers on the top of our networks' infrastructure."

AT&T

Jeremy Legg, Chief Technology Officer, AT&T: "At AT&T, we've been creating API tools to empower developers for well over a decade. Now, with a broad-based, interoperable API platform, we're giving innovators a new global toolbox where the world's best app developers can create exciting user experiences at scale. This high-performance mobile ecosystem will usher in a new era of greater possibility for customers and mobile users around the world."

Bharti Airtel

Gopal Vittal, Managing Director and CEO, Bharti Airtel: "Today marks a defining moment as the industry comes together to form a unified platform that will allow more developers and businesses to utilize our networks and explore API opportunities through open gateway principles. This move will enhance network monetization opportunities. Airtel is delighted to partner in this initiative that will help enable the telecom sector to drive growth and innovation across the ecosystem."

Deutsche Telekom

Tim Höttges, CEO of Deutsche Telekom: "The new company accelerates our leading work with MagentaBusiness APIs to expose our network capabilities for customers and developers. We believe that this company will open up new monetization opportunities for the industry. We encourage and look forward to more telecom operators joining us to expand and develop this ecosystem."

Ericsson

Börje Ekholm, President and CEO, Ericsson: "Today is a defining moment for the industry and milestone in our strategy to open up the network for increased monetization opportunities. A global platform built on Ericsson's deep technical capabilities and with a comprehensive ecosystem, that provides millions of developers with a single connection, will enable the telecom industry to invest deeper into the network API opportunity, driving growth and innovation for everyone."

Orange

Christel Heydemann, Chief Executive Officer, Orange: "This is a critical first step in our innovation journey to fully harness the power of our networks at scale, providing secure access to new on-demand network services and advanced network capabilities. By delivering a common and simple set of network APIs for developers globally, we can unleash this network value for businesses, large and small. This is a definitive gamechanger for businesses, opening up the possibility of a new wave of digital services."

Reliance Jio

Mathew Oommen, President, Reliance Jio: "We spearheaded the transformation of both mobile and fixed home broadband by delivering affordable, high-quality broadband to everyone, across India. As we rapidly adopt an AI and API-driven technology ecosystem—by collaborating with global leaders, Jio is thrilled to offer a suite of innovative and transformative APIs to enterprises and developers worldwide. Together, we are not just building networks; we are laying the foundation for a smarter, more connected, and inclusive world in the AI era."

Singtel

Mr Yuen Kuan Moon, Group Chief Executive Officer, Singtel: "This unified platform and global eco-system will enable even more developers and businesses to leverage 5G quality networks to exploit API opportunities using GSMA's open gateway principles. We look forward to helping even more enterprises and organizations in Asia to use network API solutions to drive growth and innovation through this timely collaboration." 

Telefonica

José María Álvarez-Pallete, Chairman & CEO of Telefónica: "This collaboration will drive the GSMA Open Gateway initiative and provide customers with a consistent set of Camara APIs. Our belief is that this industry movement, which will be open to all networks, can set the stage for unprecedented innovation and value creation for the sector, by unlocking the potential of network capabilities."

Telstra

Vicki Brady, CEO of Telstra: "This is a groundbreaking initiative for our industry. This new global venture will create an ecosystem that provides developers, partners and customers with access to programmable, advanced network capabilities that will unleash a new wave of innovation in digital services and further unlocks the benefits of our 5G network. We've been making good progress locally with Ericsson and other partners, and we look forward to further accelerating digital transformation for our Australian customers and bringing value and simplicity to application developers around the world."

T-Mobile

Ulf Ewaldsson, President of Technology, T-Mobile: "At T-Mobile, we've always been laser focused on championing change across the industry to create the best customer experiences, while fueling growth and innovation across the entire wireless ecosystem. That level of transformation takes unprecedented collaboration and expertise. We are excited about the possibilities this venture will create for developers and wireless customers around the world."

Verizon

Joe Russo, EVP & President, Global Network and Technology of Verizon: "The depth and value of the services and data insights accessible through Verizon's renowned 5G network are practically boundless. Verizon has been at the forefront of developing various network APIs to assist developers in enhancing customer security, reducing pain points in customer interactions, and enabling the creation of novel experiences. This exciting collaboration with global partners will broaden the availability of these services and accelerate adoption of APIs worldwide."

Vodafone

Margherita Della Valle, Vodafone Group Chief Executive, said: "Network APIs are reshaping our industry. This pioneering partnership will enable businesses and developers to use the collective strength of our global networks to develop applications that drive growth, create jobs, and improve public services. Just as 4G and smartphones made apps integral to our everyday life, the power of our 5G network will stimulate the next wave of digital services."

Google Cloud

Thomas Kurian, CEO of Google Cloud: "We understand the power of an open platform and ecosystem in driving innovation. We are proud to participate in this important partnership in the telco industry to create value for our global customers via network APIs – and ultimately deliver on the promise of the public cloud."

Vonage

Niklas Heuveldop, CEO Vonage: "This groundbreaking, open industry collaboration effectively removes the single largest barrier for developers to leverage mobile networks to their full potential. Developers across the world's leading developer platforms will benefit from accessing advanced network capabilities in partner networks globally through common APIs, accelerating the digital transformation of businesses and the public sector. As one of the leading developer platforms, we look forward to engaging our developer community as we grow the network API business."

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Global telecom leaders join forces to redefine the industry with network APIs

 

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SOURCE Ericsson

FAQ

What is the purpose of the new venture announced by global telecom leaders and Ericsson (ERIC)?

The new venture aims to combine and sell network Application Programming Interfaces (APIs) on a global scale, accelerating adoption and innovation of network APIs and creating new monetization opportunities for the telecom industry.

When is the transaction for Ericsson's (ERIC) new network API venture expected to close?

The closing of the transaction is expected in early 2025, subject to regulatory approvals and other customary conditions.

How will the equity in Ericsson's (ERIC) new network API venture be distributed?

Upon closing, Ericsson will hold 50% of the equity in the venture, while the participating telecom providers will collectively hold the remaining 50%.

Which major tech companies are partnering with Ericsson's (ERIC) new network API venture?

Vonage and Google Cloud will partner with the new company, providing access to their ecosystems of millions of developers and their partners.