Telecom Network APIs: A New Era of Innovation and Monetization in 5G

Some of the largest communications service providers (CSPs) have come together to make the capabilities of 5G networks accessible to developers. Have CSPs finally found a way to tap into network APIs’ tremendous potential?

“Network APIs” are fast becoming a buzzphrase in telecommunications. The technology is not entirely new—Network Exposure Function (NEF), the ability to expose specific network capabilities to partners and customers, is an important part of the 5G network architecture standardized by 3GPP. There have also been previous attempts (largely unsuccessful) to monetize telco APIs. However, recent news that 12 of the world’s biggest telcos have entered a joint venture (JV) to aggregate and monetize network APIs gave the idea a strong second wind. The newly formed company is committing to “redefine” the industry and provide the as-yet-elusive return on substantial investments in 5G.

In this article, we’ll explain what network APIs are and how they act as gateways to the capabilities of the 5G network. We’ll shed light on the promise they hold for both developers and CSPs and how CSPs can turn this promise into reality.

Table of Contents:

• Understanding Telecom Network APIs
• Network API Benefits for Developers
• Monetization Potential for Telcos
• Importance of Ecosystems and Partnerships
• How to Join the API Alliance
• Conclusion

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Understanding Telecom Network APIs

Network APIs are Application Programming Interfaces that allow developers and customers to access and interact with mobile network capabilities. Previously, 5G networks were a black box, their intricate inner workings unknowable to anyone outside the telecom domain. Now, via these APIs, CSPs are abstracting the complexity and offering developers an opportunity to access network data and even configure it. 

The goal? Simplified innovation for developers. Just as an electric outlet lets you plug in a device without needing to understand the complexities of how electricity is generated, transmitted, or distributed, network APIs allow developers to “plug into” advanced telecom capabilities without needing to understand the convoluted workings of a telecom network.

Network API Benefits for Developers

In Kearney’s 5G API Developer Study, 60 percent of developers said they would implement 5G APIs within a year if they had that option. Additionally, 63 percent thought that 5G connectivity would bring significant value to their projects, and 67% rated it as a high priority on their feature road maps.

So what kind of opportunities does plugging into the network API socket offer to developers? Here are some of the key ones:

• Access to Advanced Network Capabilities: 5G’s low latency, high bandwidth, and edge computing.
• Context-Aware Services: device location, network congestion, and bandwidth availability.
• Enhanced Security and Verification: mobile identity verification, fraud detection, and multi-factor authentication.
• Improved Connectivity Management: network slicing, quality of service (QoS).
• Integration with Edge Computing.

Monetization Potential for Telcos

Apart from being coveted by developers, Kearney also states that 5G APIs are the next major value-generating opportunity for telcos to monetize the under-monetized 5G. If the recently announced Ericsson-telcos JV is anything to go by, the telecom industry agrees. Kearney further stipulates that 5G API marketplaces can contribute to the 5G’s forecasted $2 trillion impact on US GDP and up to $13 trillion impact on global GDP by 2030.
Telecom API market estimates do vary wildly. One of them projects its global value to reach $1,459.5 billion by 2033, with a CAGR of 18.1% from 2024 to 2033. STL Partners forecasts the revenue opportunity created by 5G APIs to reach over $20 billion by 2028, while McKinsey and Company estimates that in the next five to seven years, the network API market could unlock $100 billion to $300 billion in connectivity- and edge-computing-related revenue for mobile operators, while generating an additional $10 billion to $30 billion from APIs themselves.

Telco API GTM Options

Telcos have several go-to-market (GTM) options when it comes to selling their network APIs. These strategies range from targeting developers directly to partnering with larger platforms and leveraging existing ecosystems.

1. Proprietary API Marketplace

Telcos can create their own developer portal or API platform and market their network APIs directly to enterprises and developers who need advanced network capabilities for their applications. Using these platforms, developers can explore, test, and integrate network APIs.  This approach gives CSPs full control over branding, pricing, and customer relationships, but requires investment in marketing and developer outreach.

Last year, T-Mobile US launched its proprietary API developer platform called DevEdge, based on LotusFlare DNO™ Cloud. Read more about it here.

2. Third-party API Marketplaces

CSPs can publish their APIs on third-party API marketplaces that aggregate APIs from multiple providers, offering developers a one-stop shop. However, this option entails revenue-sharing with the marketplace operator and having less control over customer relationships and pricing.

3. Partnering with Hyperscalers (Cloud Providers)

CSPs can also partner with cloud providers like AWS, Google Cloud, or Microsoft Azure to integrate their APIs into these platforms, leveraging the hyperscalers’ reach. This gives them access to a vast, existing customer base and developer community, but requires potentially complex revenue-sharing agreements.

4. Communications Platform as a Service (CPaaS) Integration

Telcos can integrate their network APIs into existing CPaaS platforms such as Twilio, Vonage, or Sinch, enabling developers to access telecom capabilities through these platforms. CPaaS platforms already have established developer communities and offer good integration options, but differentiation is limited since telcos’ APIs may become just one of many offerings.

5. Creating an Ecosystem or Alliance Approach

CSPs can also form alliances with other telecom operators to offer standardized APIs across multiple networks, making it easier for developers to have a broader reach. This option allows for enhanced capability and interoperability, addressing concerns about fragmentation. 

This is the approach the new JV is taking. It effectively combines multiple GTM options so that CSPs can achieve broader market coverage and capture revenue from a diverse range of sources.

Importance of Ecosystems and Partnerships

One of the reasons why previous attempts at monetizing network exposure capabilities failed was a lack of interoperability. Developers and enterprise customers simply weren’t going to buy APIs that would allow their applications to work on one network only. McKinsey & Company’s article tells about one such failed attempt: a leading carrier offered a major gaming company an API that promised gamers top-tier connectivity, but only if they were subscribers to that specific carrier. The gaming company turned down the offer, explaining that they didn’t want to develop and promote a service that would only apply to about 20 to 30 percent of gamers.

While network APIs offer endless possibilities for enhancing customer experiences, developers and businesses prioritize solutions that can scale. If network APIs don’t work seamlessly across different networks and regions, enterprises are unlikely to invest in them.

The new partnership between some of the world’s largest telecom operators, including AT&T, Deutsche Telekom, Orange, and Vodafone, along with Ericsson, represents a step toward unified access to global networks. This collaboration is an unprecedented move to combine and sell network APIs on a global scale, allowing developers to access advanced telecom capabilities without dealing with the complexity of integrating with multiple operators individually.

Harmonizing 5G APIs

This step wouldn’t have been possible without the initial efforts to promote collaboration across the global telecommunications industry. The most prominent example is the partnership between GSMA, an association representing the mobile ecosystem, and the Linux Foundation, a nonprofit focused on open-source software, to launch CAMARA—an open-source project aimed at developing a standardized set of network APIs. CAMARA establishes uniform API definitions so that developers can use 5G capabilities across various networks with a single piece of code. In addition, GSMA has introduced an initiative called Open Gateway, which aims to identify the most marketable APIs and encourage mobile operators to implement them using CAMARA’s standards.

Beyond Telco

In addition to 5G APIs being easy to use and interoperable across networks, the success of the whole endeavor hinges on telcos’ ability to sell those APIs. And this requires expanding their ecosystem to include cloud providers, technology vendors, and system integrators. It helps them connect with new segments, such as startups, enterprises, and developers, who may not typically interact with telecom providers. Collaborating with established players enables telcos to promote their network APIs through existing ecosystems, driving adoption more rapidly than if they were to market their APIs independently.

The newly formed telco alliance will provide network APIs to a broad ecosystem of developer platforms, including hyperscalers, Communications Platform as a Service (CPaaS) providers, system integrators, and independent software vendors. The joint platform is designed to be open and non-discriminatory, meaning any telecom operator, aggregator, or ecosystem player can participate. This approach encourages adoption, ensuring that the platform becomes a global standard for accessing telecom capabilities.

How to Join the API Alliance

However, to join the venture, new operators will need more than exposed network APIs at the ready. Each participant will need to have a monetization platform serving as their own API marketplace. Deutsche Telekom, the #1 global carrier and the spearheader of the JV has chosen LotusFlare DNO™ Cloud as this underpinning monetization platform. DNO Cloud will enable the onboarding of developers and business customers, publication of API products, purchase, metering, billing, and support.

Want to join the JV?

LotusFlare can provide the monetization platform.

Conclusion

Telecom network APIs have always held immense transformative potential, for developers and telcos alike. They are not just a technological advancement—they’re the key to unlocking a future filled with innovation and revenue opportunities. However, until recently, one ingredient had been missing to realize this potential: connectivity providers needed to connect among themselves.

The new telco JV represents a pivotal moment for the telecom industry, as it enables both developers and telcos to tap into the promise of 5G networks in a standardized, accessible, and efficient way. It could reshape how network capabilities are integrated into applications, driving a new era of digital innovation and growth.