Because the business gears up for its largest annual present at MWC, it’s (maybe) price wanting again at one other main 2026 telco gathering: PTC in Hawaii in January. As soon as a regional telecom meet, PTC has developed into a worldwide discussion board for AI infrastructure, and for telcos of all types inside it. Right here have been/are the speaking factors.
New economic system – The AI growth is fueling huge capital deployment, with the highest 5 hyperscalers set to speculate $602 billion in 2026 alone, whereas provide struggles to maintain tempo.
Tight spot – Telcos, completely essential, are getting the least share of the pie. However fibre operators and cell carriers are responding, deploying long-haul and metro fibre, plus edge methods.
Inference time – AI workloads are shifting from central coaching to edge inference, affording telcos an opportunity to serve hyperscalers and enterprises, and perhaps make some cash once more.
Forward of the business’s largest annual shindig, at MWC in Spain, RCR Wi-fi figured it could be price reflecting on one other main (three-letter) telco occasion to dimension up the large infrastructure dialogue that’s impacting the entire business, because it hurtles via 2026: PTC in Hawaii. As such, we’ve got summarised a number of the massive speaking factors about how the broad tech market – knowledge centres, fibre networks, cell networks, plus the remainder – is standing up the largest financial goldrush since earlier than time started: AI. So listed below are some speaking factors – from PTC, for MWC; to get a grip on the state of the market.
1 | AI is like nothing earlier than – for AI gamers, anyway
AI, nicely shucks. “None of us have seen this earlier than,” mentioned Invoice Barney, founder and chief govt at Asian Century Fairness, in his intro tackle at PTC. He detailed its complete financial revolution from the beginning: the large eight US tech shares, all newly-geared round AI, have been up 50 % in 2025, and are propping up the worldwide economic system – to the purpose US progress could be flat, or marginally down, in any other case; the entire of geopolitics, virtually, hinges on their fortunes, notably towards their current and future equivalents in China.
Joe Valenti, managing director and co-head for media and telecom at Financial institution of America, kicked off one other session. “The demand profile is gigantic,” he mentioned, opening up a dialogue concerning the state of the info centre market within the US. He reeled off some top-line stats: the highest 5 hyperscaler corporations (Amazon, Microsoft, Google, Meta, Apple) will make investments $602 billion of capital in knowledge centre infrastructure in 2026; 4 of them will spend $100 billion every – “north of fifty %” of their income in some instances. “It’s a step perform in historic capital deployment,” he mentioned.
And so they can’t go quick sufficient, it appears. There may be nearly zero over-capacity; the emptiness fee for US actual property, whether or not powered shell services or absolutely fitted areas, is simply 1.6 % in major markets, he mentioned – so just one.6 % of complete data-centre stock is presently unoccupied in historic AI-infrastructure heartlands. “It’s nicely lower than one % in sure markets – Northern Virginia being the obvious one. So we’ve got this big imbalance of demand relative to provide.” So demand is exploding and provide is sort of exhausted.
And AI is the explanation, linked largely to the duty to coach large frontier language (LLM) fashions.
2 | Energy is the bottleneck, after all – however so are individuals
Energy is the issue, as everybody is aware of – and virtually each panel at PTC mentioned. Barney recommended a 20-30 % hole within the US “between the ability that’s going to indicate up and the ability that’s wanted.” He mentioned: “So a giant drawback is the best way to speed up that aspect of the business.” Fuel? Steam? Nuclear? All the pieces’s on the desk, and nothing is simple. Microsoft’s new Fairwater knowledge centre complicated in Wisconsin makes use of extra energy than the town of LA – monster city energy centre, by any stretch.
There will likely be seven such campuses within the US by the top of 2026, and 19 by the top of 2027. “That is the start of the longer term,” mentioned Barney. Anthropic has simply constructed a knowledge centre (someplace) in “lower than two years”, he mentioned. “Which is extraordinary… It requires a gigawatt of energy, and the ability business can’t get to a gigawatt of energy in two years. As an business, we’re changing into extremely environment friendly; the problem is whether or not the infrastructure can preserve tempo.” Late December, Google’s mum or dad, Alphabet, spent $4.75 billion on Intersect Energy to bypass grid points.
Barney mirrored: “It’s the first time a hyperscaler has purchased an influence firm, and, I believe, the primary in a collection of [such deals] over time.” However the issue isn’t just energy. Talking throughout the identical session as Valenti, Jason Nance, in command of consumer options at CBRE Knowledge Middle Options, a service group inside business real-estate companies and funding agency CBRE, recommended that the migration to secondary, and now tertiary, markets in pursuit of energy has created one other problem: the best way to recruit individuals and placate communities.
The group subject is well-known – because the drain on energy impacts native vitality costs, and protests sweep elements of the US. However there was a lot dialogue at PTC about group engagement and training, and the extra novel thought was simply how to attract human energy to back-woods markets. Nance mentioned: “The largest drawback is getting individuals to maneuver to those tertiary markets. Folks take a look at the ability and the community, however… you continue to want individuals on the finish of the day. And that will stymie progress in tertiary markets… Generally it’s a bridge too far to maneuver to North Dakota.”
3 | Telcos are in a decent spot – however they’re holding aces
In his opening keynote, Barney addressed the elephant within the room: telecoms. As a result of PTC, formally the Pacific Telecom Convention, was as soon as a sunny new-year jaunt for the US telecoms business, and is now squarely concerning the broader AI infrastructure market, and the position for telcos inside it. “Twenty years in the past, we solely talked about networks – voice networks, then knowledge networks. That is PTC, proper? It was at all times about telecom. However the telcos have change into a really small piece of the ecosystem. They’ve change into a utility that transports [the data].”
He went on: “[And yet they] additionally should be stronger, sooner, and extra highly effective, [even as] telecoms will get much less and fewer and fewer of the pie. [It’s a] very tough spot. Fibre operators and cell operators are seeing a capital crunch. Regardless that the tech business is doing nicely, [even as] knowledge facilities [are] accelerating, it’s a arduous slog for them. It’s a battle simply to maintain working, and even to develop just a little… [Telcos] are getting the least quantity. However they play in all probability probably the most essential position. For those who don’t have the networks, you’ll be able to’t transport the functions.”
He added: “The capital we’re spending doesn’t match what we have to get carried out… Subscribers aren’t paying what must be paid to construct these networks.” It’s a actuality test, after all, and good to have spelled out. However the business – the fibre business, anyway – is responding. 100 and seventy million miles of recent fibre in long-haul spine infrastructure, in line with Zayo chief Steve Smith, talking individually. As much as 60 million miles of recent fibre will likely be deployed in metro areas. That’s what it would take to serve AI over the following 4 years, reckons Smith.
It’s fairly the workload, so to talk; a “massive pickup in our build-out”, he mentioned. His agency began its rollout in earnest final 12 months, he says, deploying “hundreds of recent fibre miles” simply within the US. The corporate’s backhaul and metro “necessities” have moved from 12-24 fibres, sometimes, to 48-72, to help knowledge visitors between knowledge centres, largely to coach a handful of huge language fashions to ship generative AI on a handful of consumer-oriented platforms, which use static knowledge in centralised compute clusters. However occasions are altering, as nicely – see the under entry about inference.
4 | So is the subsea sector – in the event you’re not a hyperscaler
Subsea fibre infrastructure was a significant speaking level at PTC, with an entire day given over to the topic on the Sunday. A significant crunch is coming within the Atlantic, the oldest subsea-stronghold, and the “world’s highest visitors route”. However the system is at full stretch. Seven of its 21 routes will likely be retired “comparatively quickly”, mentioned Nigel Bayliff, senior director for world submarine networks at Google. “That may be a drawback as a result of that begins to cut back that reliability mesh” – that means community resiliency from community range.
Plus, after all, the AI phenomenon is driving visitors demand via the roof. The business has delivered, up to now: capability per cable has jumped by “279,000 occasions” for the reason that first PTAT line was landed in 1988, mentioned Bayliff. EXA Infrastructure carried 4 occasions as a lot visitors on its Atlantic channels in 2025 than it did within the earlier three years mixed (2022-2024), in line with Jim Fagan, chief govt at EXA Infrastructure. “We’re seeing the expansion, and I’d like to say it’s as a result of we’re crushing it, however all of the boats are rising.”
However whereas the business has, essentially, created ‘mesh’ worth to pivot subsea lanes in direction of visitors flexibility, failover optionality, and geographic range, the system depend has remained static over a time period, and is about to say no. Its distributed landings have stretched the system. The business has compensated for fewer routes by being smarter with the place it lands them; the mesh masks fragility, in a approach – till it’s overwhelmed with AI-style demand, and it doesn’t, and the entire thing topples over. “Extra cables is certainly the reply,” mentioned Bayliff.
Extra landings, as nicely – is the instruction. “Nevertheless they’re constructed, whoever’s constructing them, extra cables to typically the identical location – so we will create these switching meshes – is the best way ahead.” However the level about who builds new crossings is a bone of rivalry. For Fagan at EXA Infrastructure, the query isn’t just theoretical: his agency owns the 2 latest “non-hyperscaler” routes throughout the Atlantic, and needs to construct extra. However for a decade now, hyperscalers have constructed many of the new trans-Atlantic and trans-Pacific subsea infrastructure themselves.
Since AI has began to spike uncontrollably, their agenda has shifted – to construct for their very own wants first, preserve any extra for inner visitors, and solely launch it to the wholesale market as a final resort. Fagan said: “We face a extreme provide crunch within the Atlantic, in all probability late 2027. If you consider the [new] knowledge middle visitors and flows, it’s going to create fairly an issue. At this level, the query is how to verify there’s sufficient wholesale capability for the remainder of the market. And for us, we predict perhaps it’s time for personal cable once more.”
5 | However even telecoms is just not in as tight a gap as some
Barney described a creating “k-shaped economic system” in his opening speech, the place the tech business is raking it in, hand-over-fist, whereas every little thing else goes south. “The remainder of the industries are form of going like this,” he mentioned, pointing down. It’s the AI business’s defining problem: past infrastructure-building, the best way to truly ship worth to boost up different industries. “Tech corporations are accelerating, whereas the remainder of the inventory market… is declining. Bricks-and-mortar corporations will not be doing that nicely. And it’s not simply the US; it’s world wide.”
Barney went on: “It’s inflicting a whole lot of the challenges, not solely with the economic system, but in addition with politics… [Because] there are two teams: the individuals which might be getting cash and the those who aren’t… Sadly, whether or not we prefer it or not, we’re on the centre of a whole lot of the issues which might be taking place throughout the US and world wide – as attributable to the financial state of affairs… Most people on this room are completely happy as a result of their shares are going up. However lots of people world wide aren’t so completely happy about the place issues are going.”
What else is there to say: AI must pay its approach, and show itself as greater than a round energy-busting economic system, which lives in a bubble, and does little in the best way of genuinely transformative good.
6 | Inference is the reply – for telcos, as the following buildout
Lynn Smullen, member of the PTC board of governors, opened a PTC session by suggesting that the mission to coach AI basis fashions will drive complete world knowledge centre capability to 120-150 GW, “even 180 GW” – and that, as AI workloads shift in direction of inference duties over the course the following couple of years, “as a lot as 90 GW of capability will likely be on the edge”. This can be a main alternative for telcos, as AI works its approach alongside their community arteries. Smullen mentioned:
“And what’s essential isn’t just energy, however the community, and its effectivity, resiliency, attain, and safety (safety).”
New AI inference functions will deliver the motion nearer to the sting, and into the enterprise area, and certain change community deployment methods alongside the best way. “We’re finding out each [trends] intently,” mentioned Smith at Zayo. “We’re constructing practically 20 new routes proper now. We’re seeing necessities for each; there’s nonetheless a whole lot of coaching that we’re all making an attempt to assist with, and inference is beginning to present up as a result of corporations are engaged on use instances and POCs. [New fibre routes] take two to 4 years; these are massive capital selections, in progress corridors.”
Perhaps the perfect session, from a standard RCR perspective, was with Verizon Enterprise, which made the case for well-adjusted telcos to serve each core community demand, geared in direction of hyperscalers, and metro and edge demand, to help enterprise utilization of AI. “It is going to gas progress for the time to come back,” mentioned Jeffrey Hulse, president of community and accomplice options within the agency’s wholesale arm. “The factor that will get us excited is the way you push AI out to the prem. Since you want dense fibre on the edge for enterprise, public sector, and for (GPU/compute) sled alternatives.”
He referenced the agency’s so-called One Fiber mission within the US to construct a converged community for its wi-fi and wireline companies. “We used to place 12 fibres down a avenue, wall to wall. After we began One Fiber, we have been placing 864 down Fundamental Avenue [and are now] placing 1,600 on crucial routes – and the use case is to place all of our macro cells on there. Fifty-one % of our websites are actually on-net…. Now we’re saying: how will we take these fibres, splice them, and go into enterprises… to provide them private-line companies, excessive velocity ethernet, wave companies.”
See extra protection from PTC right here:
Energy performs and digital divides – the arduous realities of the AI build-out
Beneath-supply to over-supply – the generational AI build-cycle
The massive dig – how edge AI inference shifts the fibre bottleneck
Atlantic crossings – crunch time for subsea cable within the AI period
Grasp and commander – Google and Meta chart AI’s subsea voyage
Verizon’s imaginative and prescient for metro fibre and personal 5G for enterprise AI inference
