The Top Trends Shaping Telecom: Eight Predictions for 2025

This Industry Viewpoint was authored by Steve Douglas, Head of Market Strategy, Spirent Communications

The start of a new year is a perfect time to take stock of the telecommunications industry and cast our eyes forward to what’s coming next. Of course, when you work closely with the companies preparing to actually deliver new innovations to users, you don’t need a crystal ball to see what’s coming. You can just observe how they spend their time and resources. 

As one of the world’s premier test and simulation companies, we work with a wide range of stakeholders shaping the future of telecom: service providers, large data center operators, chipset manufacturers, device vendors, and many others. Based on hundreds of engagements conducted last year, here are eight predictions for 2025. 

• Ethernet will soon become the dominant choice for AI networking.

Inside the world’s biggest data centers, operators are reimagining networks to keep up with explosive AI growth. Using new specialized architectures, they’re building scalable, high-performance networking fabrics to connect thousands of graphical processing units (GPUs) and other hardware accelerators to support ever-larger AI models. But which technology will those infrastructures use?

Until now, the most common answer was proprietary InfiniBand, the simplest option for achieving the low-latency, lossless performance that AI networking requires. However, many operators would prefer standardized mass-market Ethernet. Newer protocols are making this possible—currently RDMA over Converged Ethernet v2 (RoCEv2) and, soon, Ultra Ethernet Transport. As a result, Ethernet adoption will accelerate this year—and keep accelerating through 2028, when it becomes the dominant AI networking technology. 

• Enterprises will start shifting AI investment away from public cloud. 

Most enterprises adopting AI in recent years have done so via public cloud. As the business and regulatory landscape around AI evolves, however, more organizations are exploring private and hybrid models. This shift will gain traction this year in response to both high costs and the growing body of regulations governing AI data sovereignty, privacy, and security. Organizations won’t abandon public cloud, but by using sovereign and on-premises AI systems in hybrid deployments, they gain more control and auditability. 

• As hybrid deployments grow, telcos will expand AI network infrastructure as-a-service (NIaaS) offerings.

No one is better positioned than telecoms to capitalize on the cloud repatriation trend. Telcos already service most locations where enterprises want to extend AI intelligence, and they have vast experience providing secure, scalable multitenant networking and hosting. By offering on-demand local and regional AI networking resources, they can make compliance and governance simpler for enterprise customers. Telcos are also well positioned to meet the more stringent performance and latency requirements of advanced real-time AI applications.   

• Operational resiliency will become a top priority. 

Evolving regulations aren’t limited to AI. As the world’s economy and infrastructure increasingly depend on digital technologies, a growing number of regulatory mandates and recommendations are emerging around operational resilience. These efforts have been triggered by high-profile outages over the past few years that affected mission-critical systems in telecom, banking, transportation, and energy. In 2025, organizations across these industries will implement more comprehensive, continuous testing to protect against disruptions, whether due to cyberattacks or human error.  Many will also invest in testing automation, so they can test more frequently to maintain compliance and reduce risk 

• With the rise of agentic AI, telco network automation will accelerate. 

Many telecoms have invested in automation frameworks in an effort to reduce network operating costs and optimize service quality. As these efforts continue in 2025, AI will act as a “force multiplier,” making automation more adaptive and intelligent. Emerging agentic AI technologies will accelerate automation initiatives, enabling AI agents to handle more complex autonomous and semi-autonomous tasks. Relatedly, operators will invest in more advanced, automated testing to help validate and govern AI agent activity. 

• More organizations will start implementing post-quantum cryptography (PQC).

Security experts have been warning that quantum computers could break conventional asymmetric encryption within the next few years. Given the risk of cybercriminals harvesting data to decrypt in the future, government and security agencies have decided they can no longer wait to take action. They’re pushing critical industries like defense, telecommunications, and utilities to start preparing too. 

The National Institute of Standards and Technology (NIST) has released its first PQC standards, and the first wave of security products incorporating these algorithms will be available this year. Expect heightened cross-industry focus on assessing quantum security risks and testing new quantum-safe security products as organizations begin multi-year upgrade processes.    

• Smart glasses will take augmented reality (AR) mainstream. 

Virtual reality (VR) has struggled to gain wide adoption for various reasons (device form factor, price, limited use cases). This year though, expect significant momentum for its less expensive and resource-intensive cousin, AR. AR doesn’t offer full VR immersion. But with the ability to support a vast range of new consumer experiences and business use cases via normal-looking eyeglasses, it’s poised for mass adoption among both consumers and industry.

Recent announcements from Meta, Samsung, and Qualcomm, along with growing traction from early AR offerings, suggest that 2025 will be a pivotal year. Look for more AR developer platforms, more partnerships between tech and fashion brands, and new products from electronics giants to lay the foundations for mass AR adoption. 

• 5G will begin its second act, leaving stakeholders much to play for.  

5G has officially entered middle age, reaching the conceptual midpoint of its planned 10-year release cycle. While much discussion these days focuses on operators’ struggles to monetize 5G, there are two key points to remember: First, 5G was never designed as a single release but an iterative process that continually adds new capabilities. Second, less than 10% of operators have actually deployed full 5G (5G SA), so 90% still don’t have key 5G capabilities for value generation and differentiation. 

After 18 months of sluggish investment, we anticipate significant 5G momentum in 2025, especially around specific targeted features and use cases. Look for:

• More operators concluding 5G SA preparations (vendor selection, choosing which 3GPP Release 16/17 capabilities to implement) and starting commercial upgrades
• More 5G-Advanced (Release 18) upgrades targeting AI and vertical industry applications, especially in Asia and Middle East markets 
• More industrial and consumer Internet of Things (IoT) offerings as new 5G-based Reduced Capability (RedCAP) devices come to market, bridging the gap between high-performance connectivity and low-cost LTE-M/NB-IoT solutions

We also anticipate significant continued growth in 5G fixed wireless access (FWA) among both residential broadband and enterprise customers. More than 250 commercial 5G FWA networks should be live by end of 2025 (up from 162 in 2024), and more than 20 operators will launch enterprise FWA offerings this year.

About the Author

Stephen Douglas is Head of Market Strategy for Spirent Communications, helping to define technical direction, new innovative solutions and market-leading disruptive technologies. With over 20 years’ experience in telecommunications, Stephen has been at the cutting edge of next generation technologies and has worked across the industry with service providers, start-ups, and network equipment and device manufacturers, helping drive innovation and transformation across the 5G ecosystem. Stephen is an ardent believer in connected technology and strives to challenge, blur and break down the silos that prevent innovation and business success.

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Categories: Artificial Intelligence · Quantum · Software · Virtual Reality · Wireless