Are Telcos Finally Cracking the API Code?

The telecommunications industry continues to face its perennial challenge - how to overcome becoming commoditized. Telcos are motivated to up-level their value to enterprises, especially given the dominance of hyperscalers, and Open Telco Network APIs promise enhanced service agility, network programmability, and significant new revenue streams. Unfortunately, widespread adoption has proven elusive to date.

Attaining an Open Telco Network API ecosystem is not a new objective. Over a decade ago, GSMA proposed OneAPI, which elicited support from major operators including AT&T, Orange, Deutsche Telekom, and Vodafone, among others. While OneAPI did not meet its lofty objectives, it established the groundwork for a follow-on initiative, gaining momentum with operators and vendors alike- GSMA Open Gateway. 

This project, likened to a "SWIFT system for telcos", aims to enable global interoperability through a diverse API ecosystem. Open Gateway API development is underway in the Linux Foundation  CAMARA open source project. However, the Telco API marketplace is currently dominated by fraud prevention, and CPaaS (Communications Platform as a Service) already generates billions ($USD).

Telco Network APIs span several crucial areas, opening up core network and business functions to application developers. API may be 'Internal', which are primarily for operators, or 'External', which are intended for enterprise customers and their development partners. 

While application developers may have access to internal data, such as network telemetry or usage, it will typically be provided through an API layer that enables operators to limit the scope, ensuring security, privacy, regulatory compliance, corporate compliance, etc.

Summarized below are the most prevalent API categories, which are also depicted in Figure 1:

BSS/OSS APIs (Business & Operations Support Systems): (Mostly internal APIs) These APIs streamline the integration of telco operations, in-house business, and network functions. They also facilitate the onboarding of new components, enabling more choice. BSS/OSS APIs may conform to the TM Forum's Open API standards, which define over 60 RESTful APIs, specifically for integrating OSS/BSS components:

5G-Specific APIs and Vertical Enablers: (Internal APIs) Beyond generic network capabilities, these APIs are closely tied to 5G's architecture and enable a range of vertical use cases:

Network Exposure APIs: (Internal / External) These APIs enable developers and partners to securely access a carrier's core network features, including subscriber data, location, and Quality of Service (QoS) controls. The 5G Network Exposure Function (NEF) exposes such capabilities for Internal use only; Network Exposure APIs may be Internal or External.

CPaaS APIs: (Mostly External APIs)  A mature segment that focuses on providing communication functions via cloud-based, simple RESTful APIs that are in widespread enterprise adoption. Leading providers include Twilio, Vonage (now part of Ericsson), Sinch, and Infobip.

The current telecom API wave is driving extensive industry collaboration and harmonization, distinguishing it from the highly fragmented past standardization efforts.

GSMA Open Gateway: Launched in 2023, the major framework underpinning a standard set of network APIs for major operators worldwide. It aims to introduce a global ecosystem involving the world's largest operators to accelerate application deployment and foster innovation.

Linux Foundation CAMARA Open Source Project: Working in close concert with GSMA, CAMARA is focused on the implementation of the Open Gateway APIs, including a unified development environment, common tooling, and open source code.

TM Forum Open API Program: A widely adopted suite of RESTful APIs that address diverse OSS/BSS operations. Many carriers require TMForum Open API compliance for their platforms and infrastructure.

Aduna Joint Venture: Announced in late 2024, Ericsson and 11 global tier-1 operators (including AT&T, Deutsche Telekom, Orange, Verizon, Vodafone) formed a joint venture to drive a global API marketplace. Aduna explicitly aligns with Open Gateway and CAMARA to commercialize the shared vision of a Telco Network API ecosystem.

Mplify Alliance (formerly MEF) LSO (Lifecycle Services Orchestration) APIs: Mplify focuses on standardizing service interfaces to support Network-as-a-Service (NaaS). MPlify teamed up with TM Forum to adopt the Open API framework, focusing on inter-provider interactions.

Bridge Alliance API Exchange (BAEx): This consortium of Asian, Middle Eastern, and African operators aims to accelerate the adoption of Open Gateway APIs for enabling IoT connectivity across multiple operators throughout the region.

The telecom API market exhibits varied maturity levels across its segments, with some well-established (pre-dating the open telco network API movement) and others emerging: 

CPaaS / Communication APIs – MATURE: This segment is highly mature, with widespread enterprise and developer adoption, generating billions in annual revenue. CPaaS platforms are increasingly featuring network APIs, positioning themselves as key distribution channels for new capabilities.

BSS/OSS and Internal Telco APIs – ESTABLISHED: Well-established among large operators globally, these APIs are crucial for internal efficiencies, faster partner onboarding, and enabling NaaS. Hundreds of implementations are reported, reflecting strong momentum. The focus is on execution, retiring legacy systems, and externalizing select internal APIs for controlled access by large enterprise customers.

Network Exposure and 5G Network APIs – EARLY STAGES: This is a nascent market in terms of commercial adoption. While industry activity and hype are high, actual revenue from 5G network APIs was only around $700 million in 2023. However, projections estimate a climb to $6.7 billion by 2028 (57% CAGR). There's a "chicken-and-egg" problem: telcos proceed cautiously without proven demand, but developers wait for widespread availability and ease of use. 

5G Slicing and Edge APIs – PROOF-OF-CONCEPT STAGE: These are mainly in PoCs and limited production offerings. Slicing-as-a-Service is in its infancy, with Deutsche Telekom's offering a rare commercial launch. Adoption by app developers is limited due to the slow deployment of MEC at scale by telcos. This segment is expected to take off once sufficient 5G Standalone (SA) networks and edge data centers are operational.

IoT and Vertical APIs – MIXED MATURITY: APIs for IoT device management are quite mature and widely used, often offered by third-party platforms. However, standardization remains low, with each platform having its own flavor. Industry-specific APIs (e.g., for automotive or healthcare) are still emerging, with PoCs only recently getting off the ground.

Despite the tangible progress, significant hurdles remain, resulting in market uncertainty (see Figure 4), and operator tentativeness, moderating market adoption..

Developer Readiness: A glaring gap when compared to web APIs is limited accessibility to application developers for experimentation and ultimately implementation. Developers require instant API keys, comprehensive documentation, and sandbox environments a la the Cloud. Many telcos are still ramping up their developer outreach, infrastructure, and support. If the engineering experience is too cumbersome, developers may not invest the effort.

Monetization Clarity: Uncertainty persists around viable commercial models (e.g., per API call, usage-based, bundled subscriptions) and revenue-sharing complexities across multiple operators, aggregators, and partners. McKinsey warns that telcos risk ceding up to two-thirds of the value to cloud providers and OTT players if they fail to position well.

Interoperability Challenges: While standards are evolving, achieving truly seamless and consistent functionality across diverse operator networks has proven especially challenging. Different network capabilities and implementations, and most operators seek to avoid the LCD (Least Common Denominator) dilution of their value proposition imposed by standards.

Security, Privacy, and Trust: Exposing network capabilities via APIs introduces diverse threat surfaces, which are not trivial to mitigate. Robust authentication/authorization (likely OAuth-based and Zero Trust), stringent compliance with privacy regulations (e.g., GDPR), and consent management for data like location and subscriber info are paramount.

Cultural Shift and Execution Speed: Telcos are not inherently developer-centric organizations and face obstacles in adapting their operating models and execution at "cloud speed". Cultural inertia can hinder rapid development and deployment, which constrains broad adoption.

Competition and Alternative Technologies: Telco APIs are being unleashed into a competitive landscape with well-established players. Alternative solutions (e.g., device-based identity from Google/Apple, edge caching, LEO satellite networks) can address some use cases, potentially undercutting the urgency for telco-specific APIs if telcos move too slowly.

The foundational pieces for the telco API ecosystem are now in formative stages, bolstered by a set of coordinated and promising industry initiatives. This unprecedented collaboration offers substantial opportunity to collectively realize a range of benefits throughout their operations, including extreme automation, enhanced agility, network programmability and intelligence, and ultimately, significant new revenue streams.

However, the lack of demand by enterprises for open APIs and the urgency to address near-term needs have compelled operators to pursue a multi-prong strategy to serve their customers' needs today and realize the fruits of an open approach tomorrow. That is precisely what we see in the market today.

The industry's success in adopting Open Telco Network APIs in the coming years will hinge on its ability to move from investigations and pilots to commercial deployment and sustained developer engagement.

To stay informed about the rapidly evolving Open Telco Network API landscape, stay tuned for subsequent posts in this series, which will reflect market developments including: Value to Operators, Why Enterprises are seeking Telco APIs, and what lies ahead, etc.

To discuss your organization's specific needs or to participate in AvidThink's Telco Network API Research Report, please get in touch with us today at [email protected].