Huawei targets AI, 5G growth as telecom slows down

Huawei Technologies is aiming to deepen its role as a global supplier of AI and 5G infrastructure for network operators.

This comes as the telecom industry faces market saturation after years of rapid expansion and basic consumer needs have largely been met.

Speaking at the Mobile World Congress (MWC) in Shanghai, Huawei deputy chairman Eric Xu Zhijun said the industry must look for new growth areas.

He highlighted four opportunities: serving new user groups like live-streamers and delivery workers, increasing access to high-definition video, enabling intelligent connected vehicles via 5G, and expanding fiber-to-the-room networks to support small business digitalization.

Xu expressed Huawei’s willingness to collaborate with global network operators to drive sustainable growth.

🔗 Source: South China Morning Post

🧠 Food for thought

1️⃣ Global telecom saturation forcing industry-wide strategic pivots

Huawei’s assessment of telecom industry stagnation is supported by multiple industry analyses showing minimal growth prospects.

The global telecom market is projected to grow at just 2.9% CAGR through 2028 according to PwC research, with revenues expected to reach only US$1.3 trillion despite continuous infrastructure investment requirements 1.

This slow growth environment is pushing all major telecom players, not just Huawei, to seek new revenue streams beyond traditional connectivity, with operators worldwide looking to transform into “full-stack technology suppliers” to remain relevant 2.

The industry faces a fundamental challenge where core services like voice and basic connectivity have become commoditized, making it difficult to increase prices while still requiring massive capital expenditures for network upgrades and maintenance.

Market saturation is particularly evident in developed markets where, as Huawei’s Xu noted, “basic consumer needs are met,” forcing companies to target specific customer segments like live-streamers and delivery workers.

2️⃣ AI and advanced connectivity emerging as telecom’s survival strategy

Huawei’s emphasis on AI-driven solutions represents an industry-wide strategic shift that multiple research firms identify as essential for telecom’s future viability.

Deloitte reports that telecoms are increasingly focused on leveraging generative AI to enhance operational efficiency and develop new services, with industry-wide AI infrastructure investment estimates ranging from hundreds of billions to over a trillion dollars 3.