Telcos capex shift to cloud, AI, and core networks as RAN spending stays muted

Telcos capex shift to cloud, AI, and core networks as RAN spending stays muted is profiled by BTW Media because public-source evidence links it to internet infrastructure, governance, operational dependencies, or market visibility.

• Forecasts show RAN spending growth will be limited in the near term as operators direct capital towards cloud, AI, and core network upgrades.
• The muted appetite for RAN reflects broader sector strategy changes, but it raises questions about long‑term network evolution and competitive dynamics.

What happened: RAN investment outlook remains modest

According to the Dell’Oro Group’s latest forecasts, the global Radio Access Network (RAN) market—encompassing base stations, radios, and related equipment—is expected to grow only marginally in the coming years, with revenue projected to rise at about a 1% compound annual growth rate (CAGR) over the next five years. This follows steep declines in 2023 and 2024 after the peak of 5G deployments, and analysts say the market will remain muted until capital expenditure shifts towards next‑generation technologies such as 6G later in the decade.

Stefan Pongratz, vice president for RAN research at Dell’Oro, noted that “in the absence of any major growth catalysts, the appetite for RAN is expected to remain muted over the near‑term before 6G capex starts ramping.” Operators have historically invested heavily in RAN to support connectivity rollouts, but that phase of the cycle appears to be winding down for now.

At the same time, other areas of telecom investment are gaining traction. Data centre spending has surged, with third‑quarter 2025 capital expenditure for global data centers up 59% year‑on‑year, driven by growth in artificial intelligence deployments and cloud expansion. This illustrates a broader shift in capex priorities from mobile hardware towards cloud and AI infrastructure.

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Why it’s important

The subdued RAN outlook signals a strategic realignment within the telecommunications sector. Operators are increasingly balancing traditional connectivity investments with emerging demands for cloud infrastructure and AI‑driven services, where returns are perceived as more immediate or scalable. This reflects the reality that while 5G coverage is now widespread in many markets, predictable revenue growth from mobile traffic is slowing, reducing the urgency for aggressive RAN upgrades in the short term.

However, this shift also poses questions about the long‑term evolution of mobile networks. With RAN spending subdued, some industry observers worry that network innovation—especially relevant to future technologies such as 6G and Open RAN architectures—could be delayed or underfunded relative to operator ambitions. Moreover, reliance on cloud and AI hardware may emphasize data‑plan growth while leaving wireless access performance upgrades lagging.

There are additional implications for competitive dynamics: vendors heavily focused on RAN hardware could continue to face pressure, while those with portfolios in cloud, AI, and core networking stand to benefit. As the industry moves beyond the early‑phase 5G capex cycle, telcos must weigh efficiency and innovation—balancing immediate operational needs with investments that enable future service differentiation.