In 2025, the telecommunications industry stands at a pivotal juncture. While global service revenues reached $1.14 trillion in 2023 and are projected to grow at a compound annual rate of 2.9% through 2028, this growth is tempered by the persistent reliance on legacy IT systems. These outdated infrastructures consume 60–80% of IT budgets solely for maintenance, leaving minimal resources for innovation. Such systems not only escalate operational costs but also hinder the adoption of emerging technologies like 5G, AI, and cloud computing.
This article guides you through the current IT trends reshaping the telecom sector, the challenges posed by legacy systems, and strategic approaches for companies aiming to transition towards more agile and future-ready infrastructures.
Current IT Trends Reshaping the Telecom Industry
Cloud and Virtualization
Telecom companies are increasingly migrating core network functions to the cloud. This transition reduces infrastructure costs, enhances scalability, and accelerates the deployment of new services. For instance, Telefónica Germany has moved one million 5G customers to Amazon Web Services (AWS) cloud, marking a significant shift in the industry towards embracing cloud-native solutions.
AI and Automation
We’re not going to surprise anyone by saying that artificial Intelligence (AI) is playing a pivotal role in transforming telecom operations. Predictive maintenance powered by AI can reduce unexpected downtime by up to 40%, leading to substantial cost savings. Additionally, AI-driven customer support systems are becoming standard, enabling real-time network monitoring and smarter decision-making.
5G Rollouts
The global adoption of 5G is accelerating, with over 2.25 billion connections worldwide as of April 2025. This surge demands agile and scalable backend systems, which legacy software often cannot support. The rollout of 5G necessitates robust infrastructure capable of handling increased data volumes and device connectivity.
Customer-Centric Platforms
Modern telecom platforms are increasingly focusing on improving customer experience through digital self-service and personalized offerings. Companies like EE have reported a 20% increase in Net Promoter Score (NPS) after implementing comprehensive knowledge bases to support both customers and agents.
Open APIs and Integration
The adoption of Open Application Programming Interfaces (APIs) is facilitating seamless integration between telecom systems and third-party tools. This interoperability enhances efficiency and scalability. For example, Verizon’s Scammer API provides real-time risk scores for financial institutions, demonstrating the potential of open APIs in streamlining operations and reducing costs.
Why Legacy Transformation Matters
Despite the rapid pace of innovation in telecom, nearly 70% of telecom providers still rely on legacy IT systems for essential operations. These systems are typically monolithic, costly to maintain, and slow to adapt. Which is ironic, since telecom is the industry that takes pride in speeding up communication.
Time to market is one of the first casualties. Launching new services or making even minor updates can take weeks or months, instead of the days or hours possible with modern cloud-based systems. This delay gives competitors—especially digital-native players—a clear advantage.
Then there’s the issue of operational inefficiency. Many telecom teams still rely on manual workarounds and patching disconnected systems together just to complete routine tasks. That eats up resources and creates room for error.
Security is another growing concern. Legacy platforms are harder to patch and maintain, often running on outdated software with known vulnerabilities. This creates a broader attack surface and increases the risk of serious breaches.
From the customer side, the impact is just as visible. Customer experience suffers because legacy systems can’t support real-time data access, smart personalization, or fast issue resolution. That leads to outdated, one-size-fits-all service—something today’s users simply won’t tolerate.
And, of course, there’s the bottom line. Maintaining legacy infrastructure is expensive. These systems often require niche expertise to manage and come with ongoing support costs that leave little room for innovation in the budget.
How Telecoms Can Approach Legacy Modernization
Modernizing legacy systems doesn’t mean tearing everything down and starting from scratch. In fact, most successful telecom transformations follow a phased, low-risk strategy that allows companies to modernize at their own pace—without disrupting daily operations.
Many telecom providers hesitate to begin the process because they worry about service downtime, data loss, or breaking critical workflows. These concerns are valid. Telecom systems are often the backbone of essential services, and any failure could have wide-reaching impacts. But the good news is that legacy exit strategies have matured significantly. There are now proven ways to preserve core functions during the transition, gradually replace old components, and maintain full service continuity along the way.
We’ve outlined practical steps to help manage this shift in our guide on how to ensure a seamless legacy transition.
Here’s how many companies are approaching it today:
1. Assess and Prioritize
Start by identifying the systems that are most outdated or create the biggest operational risk. Not every platform needs to be replaced at once. Focus first on what will bring the most business value or remove the biggest bottlenecks.
2. Embrace Cloud Technologies
Moving to cloud-native platforms brings flexibility, scalability, and better cost control. It also makes it easier to scale up or down based on demand, roll out new features quickly, and access modern tools that simply don’t work with legacy infrastructure.
3. Adopt Modular, API-First Architectures
Rather than rebuilding everything, move away from monolithic systems and adopt microservices where each service can evolve independently. With open APIs, you can connect to third-party tools, customer platforms, and internal systems with far less friction.
4. Automate Where It Matters
Legacy systems often require a lot of manual input—especially in billing, support, and maintenance. Automation tools can dramatically reduce this workload, speed up responses, and cut costs.
5. Invest in People
Transformation isn’t just about technology. It’s also about your team. Training staff on modern tools and building internal capacity helps ensure long-term sustainability. It also reduces your dependence on legacy system specialists, whose skills are increasingly rare and expensive.
Final Thoughts
The telecom industry sits at a crossroads. While customer needs, network complexity, and competition are all evolving, many providers are still held back by decades-old technology. Modernization isn’t easy—but the cost of inaction is far greater.
Legacy transformation is the key to faster service delivery, better customer experiences, and long-term growth. The companies that act now will be the ones that lead in a more agile, digital future.
