Telco AI: State of the Market, Q1 2026

On-device AI is the next frontier for AI deployments in consumer and enterprise segments. Use cases include AI-based search and personal assistants, image analytics on a smartphone, AI-assisted driving and navigation in cars, industrial applications such as automated guided vehicles, and improved IoT analytics. This has implications for the device world and major tech companies whose business models depend on consumer time on the internet and digital platforms. It also matters for operators, given the ripple effect of AI-driven data traffic on mobile and fibre networks, and the direct revenue opportunity.

The key change over the last six months has been telecoms operators using AI in their product portfolios to enhance commercial efforts, particularly with enterprise segments. In the US alone, 50% of the new AI deployments since June 2025 have had a revenue objective. As well as recent developments from the telco AI space and the Telco AI tracker, this edition also provides a deep dive on AI's contribution to operator energy consumption.

While AI rollouts focused on saving money still account for the bulk of deployments, there is a growing movement towards using AI with a revenue objective.