As global telecommunications companies ponder how to generate revenue from 5G (5th generation mobile communications), network application programming interfaces (APIs) are gaining attention as a new source of income.
A network API refers to a tool that allows telecommunications companies to provide access to their 5G networks, enabling developers in various fields to create the latest IT services. There are expectations overseas that network APIs will generate significant revenue for telecommunications companies, while discussions on commercialization have only just begun in South Korea.
According to the telecommunications industry on the 13th, the three major telecom companies in South Korea have reached an agreement on six network API standards through the Korea Telecommunications Technology Association (TTA) after signing a memorandum of understanding for the joint establishment and commercialization of 'network open API' standards last August. As global telecommunications companies are forming alliances for the research and standardization of API technologies like Kamara and Open Gateway, preparations for commercialization have also begun domestically.
KT has completed the development verification of five APIs applicable to the prevention of financial crimes and remote driving of unmanned aerial vehicles (UAVs) and shared taxis. The API certified by KT can verify the history of SIM card changes and roaming status, and determine the usage of mobile phones. It can be used to prevent crimes such as 'SIM swapping,' which involves duplicating SIM cards to steal personal information.
According to global consulting firm McKinsey, telecommunications companies worldwide are expected to generate between $100 billion and $300 billion (132 trillion to 400 trillion won) in revenue from network API businesses over the next 5 to 7 years. McKinsey noted in its report that 'telecommunications companies in South Korea have invested in network upgrades since 2018, but they continue to struggle to generate revenue from 5G' and that 'going forward, telecommunications companies are likely to serve as essential partners for corporations seeking to accelerate digital innovation through network APIs.'
Overseas, 12 major telecommunications companies, including Deutsche Telekom, T-Mobile, AT&T, Verizon, Telefónica, Singtel, and Vodafone, along with telecommunications equipment manufacturer Ericsson, have announced plans to establish a joint venture for network API businesses in early next year. The GSM Association (GSMA) has also been promoting the 'network open gateway API' business since last year and has signed agreements with over 60 telecommunications companies.
Professor Kim Myung-joo of Seoul Women's University said, 'There are so many places where telecommunications companies need to invest in areas like artificial intelligence (AI) that, from an investment perspective, they know what needs to be done but are forced to share their capabilities.' He added, 'For the network API market to enter the economies of scale, a strategy requiring corporations to move together is necessary.'