QoD APIs Worth Over $100 Million by 2028, but Commercial Strategies Underdeveloped

7th November 2023, UK: New research from Kaleido Intelligence, a leading telecom market intelligence and consulting firm, has found that operators will struggle to monetise network APIs unless and until commercial use cases have been clearly articulated.

While the new report, Open APIs: Exposing Network Capabilities report found that the Quality on Demand (QoD) APIs would generate revenues in excess of $100 million annually by 2028, most of the Open Gateway APIs have thus far only been used in a handful of trials, with mobile network operators (MNOs) needing to assess demand before business models and monetisation strategies delineated in detail.

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Immediate Opportunity for MNOs Remain Limited

Additionally, growth in the sector would be constrained by some MNOs opting to build their own platforms, with the likelihood that this approach would not only result in further fragmentation but that such MNOs will attract little interest from developers and be unable to commercialise their products.

It also suggested that MNOs might struggle to wrest business from the established Communications Platform as a Service (CPaaS) players in the short to medium term, at least until the benefits afforded by network APIs in a 5G environment (and the attendant limitations of existing CPaaS offerings) become apparent.

Long Term Potential in Customer Experience & QoS Revealed

However, the report argued that in the longer term, network APIs had the potential to improve the customer experience and quality of service in areas ranging from the overarching customer journey to immersive activities within the Metaverse.

It anticipated that there would be increased discussions between the MNOs and the CPaaS providers, with the latter essentially seeking to continue as API aggregators with portfolios which gradually include more network APIs.

According to Kaleido, arguably the greatest potential for network API monetisation lies in hyperscaler involvement.

Report author Dr Windsor Holden said that “Hyperscalers can maximise the exposure to their large developer communities, creating an opportunity for those communities to align a wider array of applications and user cases to enterprise needs; from their perspective, participation in Open Gateway is a low or even no risk strategy.”

Contact our Consulting Team to understand the impact of Network APIs on MNO strategies and equip your business unit with the tools to drive transformative change.

About Kaleido Intelligence

Kaleido Intelligence is a specialist consulting and market research firm with a proven track record delivering telecom research at the highest level. Kaleido Intelligence is the leading research company addressing mobile roaming and connectivity services in its entirety, covering industry-leading market insights, data forecasts, historical viewpoints, competitive intelligence and operator market surveys.

Research is led by expert industry analysts, each with significant experience delivering market research and insights that matter.

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