Communications Service Providers Focus on Wavelength Services to Monetize AI Traffic

What's Happening?

Communications service providers (CSPs) are increasingly focusing on wavelength services to monetize the anticipated rise in AI-driven network traffic. According to a report by Heavy Reading, CSPs expect AI to significantly impact network connectivity demand over the next three years. The report highlights that high bandwidth wavelength services are expected to become the dominant transport service for AI connectivity. Sterling Perrin, a senior principal analyst for Heavy Reading, explains that CSPs believe AI will increase traffic at a greater rate in their long-haul networks, necessitating preparations to handle this influx. The survey conducted for the Optical Transport Networks for AI report included 77 respondents from global service providers, with half representing North America. The findings indicate that 18% of service providers anticipate AI will contribute to over half of their total metro network traffic, while nearly half expect AI to account for more than 30% of metro traffic. Expectations are higher for long-haul traffic, with nearly a third predicting AI will contribute more than half of long-haul traffic over the next three years.

Why It's Important?

The focus on wavelength services by CSPs is crucial as AI-driven traffic is expected to reshape network demands significantly. This shift presents both challenges and opportunities for CSPs, as they aim to compete with hyperscalers by capturing more traffic on their networks. The anticipated increase in AI traffic could lead to new business opportunities for CSPs, particularly in long-haul networks where they traditionally play a significant role. By monetizing AI traffic through wavelength services, CSPs can optimize their resources and potentially enhance their competitive edge. This development is likely to impact the telecommunications industry, influencing how service providers strategize to accommodate and capitalize on AI traffic growth.

What's Next?

CSPs are expected to continue preparing for the increase in AI traffic, focusing on enhancing their network capabilities to support high bandwidth wavelength services. As AI traffic grows, CSPs may explore new business models and partnerships to leverage this trend. The upcoming Optical Networking Digital Symposium on September 11 will provide further insights into AI and optical transport, offering CSPs an opportunity to discuss strategies and innovations in this area.