Ciena says AI services to drive telecoms revenue growth

Ciena has published survey findings showing that service providers expect AI-related network services and managed optical fibre network (MOFN) services to drive revenue growth. The research covered more than 1,200 telecom, wholesale and regional service provider professionals across 12 countries.

The study found that 90% of respondents expect high-capacity AI network services to support revenue growth over the next three to five years, while 56% said those services would be their main source of net-new revenue. Confidence was also high in MOFN services, with 96% expecting them to generate revenue from connecting distributed AI compute clusters over the next three years.

At the same time, respondents said existing infrastructure will need upgrades if operators are to capture that demand. Some 88% reported a strong sense of urgency around optical network upgrades to meet the requirements of premium enterprise AI service-level agreements.

Nearly half of those surveyed said such upgrades were critical, and 39% said they would be needed within the next 12 to 18 months. Only 11% said routine upgrades would be enough to meet expected demand.

Ciena's findings point to a broadening set of AI-related income streams for telecoms operators as they look beyond traditional connectivity products. The survey highlighted opportunities in data centre interconnect, edge services, cloud connectivity, AI consumer devices and security services.

Revenue areas

On AI inference, 49% of respondents said growth in inference data centres would create new revenue opportunities by increasing demand for data centre interconnect services. For GPU-as-a-service, 94% said strategic partnerships with cloud and neocloud providers would be essential, while 44% said revenue-sharing models would be their main route to market.

Consumer-facing uses of AI also featured strongly. Almost all respondents, or 95%, said immersive and AI-driven entertainment would contribute to new revenue streams within three years. Meanwhile, 29% identified AI wearables and personal devices, including smart glasses and health trackers, as the consumer hardware segment most likely to drive premium service revenue.

The network edge emerged as another growth area. The survey found that 39% of service providers believe services hosted at the edge, including edge compute, GPU-as-a-service and localised AI inference, will account for more than 20% of enterprise revenue over the next three years, while 88% expect such services to contribute at least 10%.

Physical AI was also seen as a meaningful source of future enterprise income. Six in 10 respondents said ecosystems such as industrial robotics and remote-control systems would make up more than 15% of their total enterprise AI revenue within five years.

Network demands

The responses suggest operators see monetisation opportunities not only in raw bandwidth, but also in more predictable network performance. Some 35% identified network consistency, including stable performance and low jitter, as the main opportunity to sell premium services.

The survey also reflected changing data centre economics among the largest cloud operators. As power constraints limit expansion on single campuses, hyperscalers are spreading compute across multiple sites and requiring high-speed synchronised links between them.

Against that backdrop, 95% of respondents said hyperscaler demand for scale-across infrastructure would make a substantial contribution to wholesale revenue growth. Ciena said distributed synchronous training of large AI models can require links at tens of petabits per second, with large numbers of fibre pairs lit in parallel.

Multi-cloud enterprise demand was another theme. More respondents ranked multi-cloud connectivity management and consumption-based bandwidth services as leading revenue drivers than traditional fixed-capacity offerings. The survey found that 56% pointed to multi-cloud connectivity management, 50% to consumption-based bandwidth services and 38% to fixed-capacity services.

Another 47% said enterprises moving large datasets between cloud environments for AI processing would increase demand for high-capacity, flexible cloud connectivity.

Security focus

Security featured prominently as operators prepare for AI-driven traffic growth and longer-term cyber risks. More than half of respondents, or 51%, said they had already launched or expected to launch commercial quantum-safe encryption services within 12 months, including quantum key distribution-protected links or post-quantum cryptography-ready managed security.

A further 48% said they were still in the early development or evaluation stage. The survey also found that advanced physical and cyber security was the leading commercial driver of sovereign network infrastructure.

Alongside physical upgrades, automation was seen as a core requirement for handling AI-related network demands. Some 96% of respondents said advanced network automation, including agentic AI, would be essential to capitalise on AI-driven business opportunities.

"The survey findings show that service providers are approaching AI with both optimism and urgency," said Brodie Gage, Chief Product and Technology Officer at Ciena. "Service providers see significant opportunities around AI inference, GPU-as-a-service, high-capacity network services and quantum-safe encryption, while recognising that many existing networks must evolve to meet new performance demands. The message is clear: AI is creating new sources of revenue, and success will depend on having the network foundation to support them."