Global telecoms opex fell marginally by 0.2% in 2024 with encouraging but subtle improvements in labor and network utilities opex. But disclosures of quantifiable AI savings remain scarce.
Omdia view
Summary
Omdia’s newly published Global Telecoms Opex Tracker – 2024 (see Further reading) reveals that global telecoms opex decreased marginally by 0.2% to $1.63tn in 2024, while total revenue increased by 3.4% to $2.01tn. This improvement in the opex-to-revenue ratio from 84% to 81% (or from 67% to 65% when depreciation, amortization, and one-off charges and income are excluded) suggests modest efficiency gains with encouraging but subtle improvements in opex for labor and network utilities. However, the industry remains quiet on revealing tangible cost benefits from AI implementations, despite claims of its transformative potential.
Figure 1: Global telecoms opex flow, 2024
Source: Omdia
Telcos kept opex under control in 2024
Global adjusted opex (which excludes depreciation, amortization, and one-off charges and income) decreased by just 0.1% to $1.31tn in 2024. This modest reduction, though incremental, demonstrates the industry’s ongoing commitment to efficiency initiatives in a challenging environment of rising network complexity:
- Network opex remained flat at $441bn, a growth of 0.2%. Efficiency improvements in energy usage neutralized mild increases in network infrastructure costs.
- Non-network opex also remained unchanged at $867bn, a decline of 0.2%. Operators have implemented efficiency programs in back-office functions, but some have simultaneously increased spending on digital transformation initiatives and customer experience enhancements, resulting in a net neutral position.
AI: Still more talk than tangible
Despite extensive investment, effort, and discussion surrounding AI as a transformative force for telco operations, concrete reporting of significant cost savings remains uncommon. Operators continue to highlight AI initiatives in their reporting but provide limited quantifiable data on resulting opex reductions.
The industry faces a credibility gap between the promised benefits of AI and demonstrable results. Though isolated examples of AI-driven efficiencies exist, these represent a fraction of total opex. For instance,
- BT reported that it rolled out AIOps, which fixed around 23% of incidents across its digital estate, “reducing human effort to fix outages and downtime for customers,” in its FY25. In FY24 it reported £35m annual savings from AI-powered automation in Openreach (0.2% of total opex).
- China Telecom “deepened AI empowerment to cost reduction and efficiency enhancement” [sic].
Some telcos, such as Deutsche Telekom, are open about stating that AI will lead to role reductions and hence opex savings. On the other hand, Christel Heydemann, CEO of Orange, stated, “At this stage, the technology is really far from replacing humans,” when she was asked about AI during Orange’s 2024 earnings call.
Labor and network utilities opex was reined in
The 2.2% decline in global labor opex to $300bn represents a significant achievement following the challenging trend in 2023, when labor opex increased by 4% despite notable layoffs. This reversal indicates that operators’ workforce transformation initiatives are now delivering tangible financial benefits.
One example is AT&T, which reported a 6% headcount reduction and an 11% decrease in median compensation in 2024, suggesting departures were weighted toward employees paid above the median. It highlighted “expense declines from our continued transformation efforts, including lower personnel charges” in its reporting. This demonstrates that strategic workforce optimization can yield substantial cost benefits when implemented effectively. For more information, please see Omdia’s Telecom and Hyperscale Platforms Financial Benchmark – 4Q24.
After years of inflationary pressures driving up compensation costs despite headcount reductions, 2024 marks an important turning point where telcos are finally realizing meaningful labor cost savings through more comprehensive transformation approaches.
Network utilities costs fell by 2.3% in 2024
This marks a significant reversal after consistent increases every year since at least 2019 (when our tracking begins). This welcome reduction is partly due to external factors such as declining global energy prices in 2024. For example, Vodafone disclosed its energy costs across Europe were €0.2bn lower in 2024 despite an increase in total energy consumption. However, telcos also deserve substantial credit for implementing effective energy-efficiency programs that reduced actual consumption. For example, AT&T reported “savings of approximately 340,000MWh, lowering our carbon footprint by nearly 120,000 metric tons of CO2e” in 2024, attributed to the transition of its network from copper to fiber. This infrastructure modernization delivers both operational savings and environmental benefits.
Other operators have achieved similar results through network optimization, equipment upgrades, and smart energy management systems. These initiatives position telcos advantageously amid growing global demand for energy, because improved consumption efficiency provides both cost resilience against future price volatility and progress toward sustainability commitments.
Appendix
Further reading
Global Telecoms Opex Tracker – 2024 (August 2025)
Telecom and Hyperscale Platforms Financial Benchmark – 4Q24 (May 2025)
Author
Adam Mackenze, Senior Analyst, Service Provider Network Economics and Strategies
