Network APIs: reducing friction and spurring innovation in the telecoms industry
Head of Marketing, Strategy and Insights for Europe and Latin America
Head of Marketing, Strategy and Insights for Europe and Latin America
Head of Marketing, Strategy and Insights for Europe and Latin America
What does a King’s coronation broadcasted over 5G, silent identity authentication by a banking app, and a connected community of over 30,000 farmers have in common? They demonstrate how 5G brings real value for businesses and end users by eliminating friction and creating a seamless experience.
By opening up the network's features and capabilities to developers via APIs, mobile operators can start to extract the full potential of 5G. A shift that would see mobile networks go from 'connectivity pipes' to programmable platforms promises an explosion of innovation in the app economy and new revenue streams. It is a win-win for developers and CSPs - developers can harness the unique features of 5G in their applications, while CSPs get a piece of the pie from the generated revenue, justifying their hefty investments in building out future-ready networks.
But before we dive deeper, let's take a step back to clarify network exposure and APIs and their potential to shake up the industry.
APIs Decoded
In the telecom industry, we've been using APIs for over a decade. They've powered communication features like SMS two-factor authentication, automated alerts, and in-app voice chat. But the next big thing for APIs in telecom lies in unlocking the unique features of 5G for developers. The monetization potential of this is massive, predicted to be valued at $20 billion by 2028, according to STL Partners.
"The revenue opportunity created by mobile network APIs is forecast to grow to over $20 billion by 2028. As connectivity becomes ever more integral, network APIs are emerging as a highly anticipated means for telcos to instantly monetize their 5G investment"
Joakim Sorelius, Head of Global Network Platform, Product and Engineering at Ericsson.
So, how can CSPs jump on the network API train? Our chat with Deutsche Telekom and Telefonica Vivo Brazil highlighted the first step: understanding your customers' needs and pain points.
The Importance of Knowing Your Customers
By leveraging network APIs, CSPs can offer more personalized and tailored services, using advanced 5G capabilities such as enhanced security, authentication, and location-based services.
Diego Aguiar from Telefonica Tech shared a real-life example during his 5G Talks interview. Financial companies in Brazil have been struggling with fraud, a problem worsened by the increase in digital transactions. Telefonica Vivo Brazil addressed this issue by using network APIs to provide a personalized anti-fraud solution to validate their users’ digital identity, from the account creation to digital transactions.
One of the key applications is the Number Verification API, which silently validates and authenticates a customer using their phone number, eliminating the need for 2FA codes. This makes the onboarding process smoother, reducing friction for the end user, and limits opportunities for scams.
"This approach expands the range of services and applications that can be developed by companies of any size in the market, providing new lines of services that were not previously explored by telecom companies and that are now enabled by the Open Gateway initiative"
Diego Aguiar, Director of Operations at Telefonica Tech
This approach has made a significant positive impact. By exposing network capabilities via APIs, Vivo has been able to enhance security, reduce fraud, and monetize their advanced 5G network capabilities. But it is by no means the only example of network API’s in action.
In 2023, Vodafone utilized 5G network slicing technology to broadcast the Royal Coronation in the UK, enabling high-quality, low-latency streaming of the event to a global audience, while simultaneously providing connectivity for thousands of in-person attendees without interruption. A similar application of 5G network slicing for television broadcast is being utilized by Deutsche Telecom and RTL Deutschland, who are simplifying mobile TV production by replacing the need of satellite broadcast vehicles with a single backpack containing the transmission tech.
On the other side of the world, BASF is utilizing Vonage APIs to connect a community of 30,000 farmers across 20 countries via WhatsApp. The two-way communication channel paired with geo location-based analytics is empowering farmers with information and resources crucial to their livelihoods.
Solutions like these show the potential of APIs in creating innovative solutions to contemporary problems and unlocking new opportunities for our evolving digital society.
Premium Experiences, On Demand
One intriguing application of network APIs is 'Quality-on-Demand' (QoD). The idea is that users can significantly enhance their experience for a specific application or use-case by paying a small premium which can be controlled dynamically by the user or bundled into the service offering.
For example, a gamer might pay a premium for guaranteed low latency and stability in a competitive online game. Or a sports fan may pay a premium for guaranteed connectivity at an event to share their experience over livestream or video chat without interruptions.
These scenarios show the potential for CSPs to use QoD APIs to provide differentiated services that enhance user experience and, in turn, boost customer satisfaction and loyalty. Our research shows that smartphone users are willing to pay an average premium of 11% for a quality of service-led offering.
"Smartphones users are willing to pay an average premium of 11% for a quality of service led offering... it is the biggest opportunity since the birth of mobile broadband in 2010."
Hans Hammar, Head of Network Business Strategy at Ericsson
The Path Forward, Together
Ericsson powers over 150 commercial 5G networks in more than 60 countries. It's a huge opportunity to connect developers with a truly global user base.
That's the ultimate goal of Ericsson and Vonage’s Global Network Platform (GNP): to work with our CSPs to speed up the development and availability of network services and APIs to developers, application service providers (ASPs) and enterprises worldwide.
Joakim Sorelius from Ericsson explains the vision: “Together, Ericsson and Vonage are building the foundation of a global network platform that is making it easier for businesses to enhance applications with integrated communications, advanced security, and superior performance."
The future of 5G isn't just about adding speed and capacity, it's about how we can expose the network's capabilities to eliminate friction, develop solutions for industry, and offer premium services that bring value to end users and the entire ecosystem. The key to all of this is collaboration and partnerships, because only by working together can we fully unlock the potential of the API revolution. Ultimately, our strength as an industry lies in our ability to innovate and adapt.
What do you think about the network API opportunity? The insights from this article were taken were taken from episode 5.
