What's Happening?
Rob Atkinson, a partner at EY UK&I, discussed the current state of the telecom industry at the Connected Britain 2025 event. He emphasized the industry's ongoing transformation from traditional telecom companies to technology-focused entities, a shift
often referred to as 'telco to techco.' Despite the enthusiasm for AI, particularly agentic AI, Atkinson noted that 95% of AI pilot projects are failing due to legacy IT systems that hinder innovation. He also addressed the significant investments in data centers, pointing out the practical challenges such as obtaining planning permissions and securing sustainable energy sources. These hurdles could impede the progress of these projects, which are crucial for the industry's future.
Why It's Important?
The insights shared by Atkinson are significant for the telecom industry as it navigates the transition to more technology-driven operations. The high failure rate of AI projects highlights the need for companies to address underlying IT infrastructure issues to fully leverage AI's potential. Additionally, the challenges in data center investments underscore the importance of sustainable practices and innovations in energy use and cooling systems. These factors are critical as data centers are essential for supporting the growing demand for digital services. The industry's ability to overcome these challenges will impact its competitiveness and sustainability in the long term.
What's Next?
The telecom industry is likely to focus on overcoming the barriers identified by Atkinson. Companies may need to invest in upgrading their IT systems to better support AI initiatives. In terms of data centers, there may be increased efforts to innovate in energy efficiency and cooling technologies to ensure these projects are viable and environmentally sustainable. Stakeholders, including policymakers and industry leaders, might also engage in discussions to streamline planning processes and support sustainable energy solutions.
Beyond the Headlines
The discussion around AI and data centers also touches on broader themes of digital transformation and sustainability. As telecom companies evolve, they must balance technological advancements with environmental responsibilities. The industry's success in this area could set a precedent for other sectors undergoing similar transformations. Moreover, the focus on sustainable energy solutions for data centers could drive innovation in renewable energy technologies, benefiting the wider economy.
