Telco data monetization: Dialing up profits

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  Quantumrun Foresight
• March 27, 2025

Insight summary

Telecommunications companies (telcos) are turning customer data into profit by sharing insights with businesses and governments. While this trend creates personalized experiences and new business models, it also raises serious questions about privacy and data protection. As telecom data becomes a key economic asset, it could reshape how people spend money, how companies develop products, and how governments set privacy standards.

Telco data monetization partnerships context

Telecommunications data monetization partnerships capitalize on the substantial amounts of data telcos routinely collect from customers, including user behaviors, location details, and device information. By anonymizing and analyzing this data, telcos can offer valuable insights to external businesses such as advertisers, retailers, and even municipal governments. For example, Verizon Enterprise Solutions in the US collaborates with insurance providers, leveraging telematics data collected from Internet of Things devices installed in cars to offer usage-based insurance premiums tailored to individual driving behaviors.

One of the primary developments driving telco data monetization is the expansion of digital marketplaces, which are platforms that allow telcos to sell data-driven insights or co-create services with third-party partners. According to McKinsey’s 2021 report, Japan's NTT DOCOMO successfully utilized a digital marketplace to generate 23 percent of its overall revenue by offering products in healthcare, telemedicine, and financial advisory services. Similarly, T-Mobile in the US leverages billions of daily data points from mobile users' interactions to understand consumer behaviors and preferences, helping businesses fine-tune their marketing strategies. 

Ericsson projects the average mobile data usage to increase from 21 gigabytes (GB) in 2023 to 56 GB per smartphone by 2029, providing telcos with even richer data sets, creating further opportunities for profitable partnerships and personalized customer experiences. However, telco data monetization faces challenges around privacy, data security, and regulatory compliance. Telcos need to adhere strictly to data protection laws such as the European Union's General Data Protection Regulation and the California Consumer Privacy Act while managing customer expectations for privacy. Firms like India's Airtel and Norway's Telenor have implemented rigorous governance models to manage these issues responsibly, while Airtel's IQ Hyperlocal platform ensures personalized targeting while complying with regulatory standards. 

Disruptive impact

Using customer location data, telecom companies can offer discounts precisely when someone enters a store or restaurant. Such targeted deals may save consumers money by prompting timely purchases. However, increased use of personal data might mean consumers gradually lose control over their privacy, even when data is anonymized. Additionally, frequent personalized ads and promotions based on telecom data could lead consumers to spend impulsively or beyond their planned budgets.

Meanwhile, retailers and service providers can benefit by accessing highly accurate consumer behavior data, improving their marketing efficiency and reducing advertising costs. For instance, landscaping businesses could use seasonal insights from telecom data to identify neighborhoods most likely to seek yard maintenance services. Conversely, smaller businesses without access to telecom-driven insights may struggle to compete effectively against those with sophisticated data partnerships. Over time, reliance on telecom data for business decisions might cause some companies to neglect traditional market analysis skills.

Public sector organizations could harness anonymized telecom data to optimize urban planning, traffic control, or emergency responses during natural disasters. For example, telecom data could inform city planners exactly where to improve public transport routes or build new infrastructure based on real population movement patterns. However, governments may face increasing pressure from citizens demanding stricter regulations to protect personal privacy against commercial exploitation. Additionally, international collaborations on data privacy standards could become necessary, potentially creating diplomatic challenges when countries differ widely in their approaches.

Implications of telco data monetization 

Wider implications of telco data monetization may include: 

• Consumers increasingly adjusting their behavior based on telecom-driven personalized recommendations, leading to shifts in spending patterns.
• Companies creating subscription-based business models focused entirely on personalized, telecom-driven marketing services.
• Politicians facing voter pressure to introduce clear laws limiting how telecom companies monetize consumer location data.
• Telcos significantly investing in advanced analytics and artificial intelligence to process larger volumes of data efficiently.
• Cities experiencing reduced pollution by optimizing traffic flows using telecom data to manage congestion efficiently.
• Workers facing new job demands in roles specializing in analyzing consumer telecom data or managing data privacy compliance.
• Public healthcare systems leveraging telecom-generated data to accurately track population health trends and outbreaks.
• Rural and underserved communities gaining targeted economic investments as telecom data highlights untapped market segments.
• Growing public debates around data rights influencing education systems to include mandatory data literacy programs for students.

Questions to consider

• How comfortable are you with companies using your personal data to provide tailored shopping experiences?
• How might increased data-sharing between businesses affect your daily purchasing decisions?