The telecommunications industry stands at the forefront of connectivity, transforming how businesses and consumers interact with technology and each other. The convergence of cloud-based solutions and the capabilities of 5G presents vast opportunities for innovation, with network APIs (Application Programming Interfaces) serving as a critical enabler of this transformation. Network APIs have emerged as a key tool for telcos to not only modernize their services but to unlock new revenue streams and business models that were previously unimaginable.
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As the industry evolves, telcos are no longer confined to just providing connectivity and infrastructure. By exposing advanced network capabilities—such as quality of service, security, and location services—through APIs, telcos empower developers to create a wide range of applications that enhance customer experiences and address emerging business needs. This API-first approach fosters collaboration with external developers, businesses, and industries, allowing telcos to capitalize on their assets in new and innovative ways.
Through network APIs, telecom operators can now offer differentiated services and advanced use cases that leverage the power of 5G, from enhancing mobile gaming experiences with low-latency connectivity, to improving drone management with real-time location data, and ensuring the security of financial transactions through advanced authentication protocols. These services not only drive consumer engagement but also stimulate greater 5G network usage, ultimately creating a more dynamic ecosystem where businesses, service providers, and developers can thrive.
For telecom service providers, the benefits of adopting network APIs go beyond innovation. By providing access to advanced network features, telcos can monetize these capabilities in ways that align with the evolving needs of both businesses and consumers. The API economy is reshaping the telco landscape, enabling strategic partnerships across sectors like banking, healthcare, e-commerce, and more, resulting in integrated, value-added services that offer personalized experiences and open the door to new revenue opportunities.
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Basics about Telecom Network APIs
Telecom network APIs serve as the bridge between the complex telecom infrastructure and the developers or businesses looking to leverage mobile network capabilities. These Application Programming Interfaces (APIs) provide an easy-to-use gateway, enabling external users to access, interact with, and even configure various network features. Prior to the advent of APIs, the inner workings of 5G networks were often a “black box”—opaque and inaccessible to anyone outside the telecom industry. However, with the introduction of network APIs, communication service providers (CSPs) are abstracting the underlying complexities of these networks, offering developers a powerful tool to tap into advanced telecom capabilities.
The primary goal of network APIs is to simplify innovation for developers. Analogous to how an electric outlet allows you to plug in a device without needing to understand how electricity is generated, transmitted, or distributed, network APIs enable developers to “plug into” the capabilities of telecom networks. This empowers them to create advanced applications, services, and solutions that would have previously required deep knowledge of telecom infrastructure.
By providing access to features such as quality of service (QoS), network security, and location-based services, telecom operators are not just opening up new avenues for innovation—they are transforming how developers interact with network resources, facilitating faster and more efficient service creation. This simplified interaction with advanced telecom capabilities is a game-changer, not only for the developers who can now build more sophisticated applications but also for the telecom industry itself, which stands to benefit from new revenue streams and partnerships.
Evolution of the Network API Market
Network APIs were first introduced in 2009 as MNOs tried to compete with app stores like Apple’s and Google’s. Early efforts, such as Telefónica’s Bluevía and Vodafone’s Betavine, failed to attract developers and were eventually abandoned.
After a 14-year hiatus, telcos revived API development with the GSMA Open Gateway initiative in 2023, focusing on collaboration to drive innovation. The CAMARA project has been key to promoting network API adoption.
Shift from Consumer to Enterprise Focus
Initially, telcos targeted consumers, hoping to monetize app stores. However, with Apple and Google’s dominance, this approach failed. Today, telcos are shifting focus to enterprise applications. Yet, the fragmented nature of enterprise needs makes it challenging to develop APIs that drive high adoption and revenue. Collaboration among telcos is crucial to minimize financial risks and maximize API potential.
Recent Developments and Competition
The network API market is now crowded with players like CPaaS providers, hyperscalers, and system integrators. Companies like Infobip and Vonage have rolled out CAMARA-compliant APIs for services like number verification and SIM swap. Meanwhile, cloud giants like Azure and AWS are working to unify APIs across networks to support emerging applications like XR and autonomous vehicles.
Nokia’s Network as Code (NAC) platform simplifies network API access for developers, offering global support and integration with the 3GPP Network Exposure Function (NEF). This shift toward more accessible APIs is opening new opportunities for both developers and telcos.
A Road Map for Unlocking Telecom Value from Network APIs
While the telecom industry has yet to fully convince businesses and consumers to pay a premium for 5G connectivity alone, emerging trends suggest that customers are more than willing to invest in enhanced experiences that leverage the power of 5G. The key to unlocking this value lies not just in the network itself but in how telecom operators use network APIs to create tailored, impactful use cases that resonate with both enterprise and consumer customers.
A McKinsey survey revealed that 14% of 18-to-24-year-olds are willing to pay for 5G boosters that enhance their gaming or video-streaming experience, using them on average seven times per month if priced around $1. Additionally, 15 to 20% of customers are open to paying between 7.5% and 15% more for “business class” 5G plans. This highlights a crucial shift: consumers place value not on raw connectivity, but on the enhanced experiences that 5G can enable.
Network APIs are pivotal in bridging this gap. By exposing advanced 5G capabilities to developers and businesses, telcos can create a wide array of subscription models, services, and applications that focus on real-world use cases—such as premium gaming experiences, low-latency video applications, and secure financial transactions—that customers are eager to pay for. This shifts the 5G value proposition from abstract connectivity to tangible, desired outcomes.
However, the telco industry faces a classic chicken-and-egg dilemma when it comes to network APIs. Many telecom operators have been hesitant to invest in network APIs without clear demand from enterprises, while enterprises are reluctant to adopt these technologies without a robust supply of user-friendly, interoperable APIs and proven use cases.
To overcome this challenge and unlock the full monetization potential of 5G, telcos must focus on building a balanced ecosystem—generating both supply and demand for network APIs. By nurturing this nascent market, telecom operators can create a strong foundation that will drive innovation, encourage enterprise adoption, and ultimately position the telco industry at the center of next-generation digital solutions. Once supply and demand are established, telcos can begin to shape market structures and partnerships that maximize their share of the value that network APIs can deliver, positioning themselves as leaders in the evolving digital landscape.
Maximizing Value from Network APIs
Telecom operators are rapidly evolving their network API offerings, moving beyond legacy services like SIM and location-based APIs to more advanced, high-value solutions. Although these APIs are still in the early stages, they are set to unlock significant opportunities in the coming years.
Key Areas for Network API Growth
The emphasis is shifting toward APIs that deliver enhanced security and network performance. Initiatives like T-Mobile’s DevEdge and Orange Developer have pioneered security-focused APIs. Other promising APIs, such as Quality of Service (QoS) on Demand and network slicing, are gaining traction and are expected to shape the future of telecom innovation. According to ABI Research, network API service revenue is projected to rise from $1.3 billion in 2024 to $13.4 billion by 2028, with network slicing and security APIs leading the way.
Key Network APIs to Watch
- QoS on Demand APIs: These APIs allow developers to request stable latency or throughput without deep network expertise. While improvements cannot always be guaranteed, especially at the cell edge, they are expected to generate $3.1 billion by 2028, offering a valuable, though smaller, opportunity for telcos.
- Network Slicing APIs: With high throughput and low latency, network slicing enables more complex, high-performance applications. Though more technically demanding, this API is projected to generate $5 billion by 2028, making it a significant revenue stream for operators.
- Security APIs: Security-focused APIs are a major 5G monetization opportunity, helping enterprises secure services and authenticate users. By 2028, the security API market is expected to reach $5.3 billion, with applications ranging from fraud detection to location-based services.
Final Thoughts
Network APIs hold significant promise for telcos to unlock the full potential of 5G monetization. However, realizing this potential requires strong collaboration among telecom operators to build a robust ecosystem of interoperable APIs while generating global demand. By enabling enterprises to tap into 5G’s capabilities—such as fraud prevention, bandwidth prioritization for critical applications, and real-time insights—network APIs could be the key to transforming the industry.
To stay competitive and keep pace with technological advancements, telecom carriers must strategically open their services for quick repurposing across web and mobile platforms. Involving third-party developers can spur innovation, but the true value lies in enabling internal teams and key external partners to reuse these services effectively. A well-defined API publishing strategy can enhance collaboration and drive productivity across the organization.
However, exposing telco services via APIs also introduces challenges related to security, data translation, and developer management. These challenges can be effectively addressed by implementing an API gateway and developer portal. The gateway acts as a mediator, filtering and auditing the data flow, while the developer portal serves as a hub for developers to discover, test, and leverage the APIs.
For telcos, moving quickly and working together is crucial to capitalize on the opportunities that network APIs present. If they fail to act, enterprises may turn to other technologies to meet their needs, leaving telcos once again on the sidelines of the digital transformation.
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