Ciena survey: AI revenue & quantum-safe encryption

Ciena has published a survey of 1,200 service provider executives and specialists on where they expect AI-related revenue to come from over the next five years. It found that 51% have launched or expect to launch commercial quantum-safe encryption services within 12 months.

The poll covered telecom, wholesale fibre network and regional service providers across 12 markets, with 100 respondents in each country. It points to strong expectations that AI-linked connectivity services will become a larger source of revenue, while also highlighting concern that existing optical networks will need upgrades to meet demand.

Ninety per cent of respondents said high-capacity, AI-driven network services would drive revenue growth over the next three to five years, and 56% identified them as their main source of net-new revenue. Ciena defined those services as connectivity to AI infrastructure used by enterprises, hyperscalers and neoscalers.

Managed optical fibre network services also featured heavily in provider expectations. Some 96% expect such services to generate revenue from connecting distributed AI compute clusters over the next three years, while 51% said they would be their primary route for delivering data centre interconnect services.

Upgrade pressure

Respondents also pointed to growing pressure on network infrastructure. Eighty-eight per cent reported a strong sense of urgency around optical network upgrades to support premium enterprise AI service level agreements.

Nearly half, or 48%, said those upgrades were critical, while 39% said they would be needed within the next 12 to 18 months. Only 11% said routine upgrades would be enough to meet the expected rise in demand.

The survey also found broad support for greater automation in network operations. Some 96% of respondents said advanced network automation, including agentic AI, was essential if operators were to take advantage of AI-related business opportunities.

Enterprise demand

Several of the strongest revenue expectations were tied to enterprise use cases. Sixty per cent of service providers said physical AI ecosystems, including industrial robotics, machine vision and remote-control systems, would account for more than 15% of their total enterprise AI revenue within five years.

Edge services were another area of focus. Thirty-nine per cent of respondents said services hosted at the network edge, including edge compute, GPU-as-a-service and localised AI inference, would generate more than 20% of enterprise revenue over the next three years, while 88% expected such services to contribute at least 10%.

Growth in AI inference data centres was also seen as a source of new business. Nearly half of those surveyed, or 49%, said the expansion of inference facilities would create fresh revenue opportunities by increasing demand for data centre interconnect services.

In multi-cloud environments, providers pointed to more flexible charging and connectivity models. Multi-cloud connectivity management was cited by 56% as a leading revenue driver, ahead of consumption-based bandwidth services at 50% and traditional fixed-capacity services at 38%.

Another 47% said enterprise demand to move large datasets between cloud environments for AI processing would increase the need for high-capacity, flexible cloud connectivity. This suggests operators expect AI workloads to reshape not only transport demand, but also the commercial models attached to it.

Consumer and cloud links

The findings extended beyond enterprise infrastructure. Almost all respondents, or 95%, said immersive and AI-driven entertainment would contribute to new revenue streams within three years.

Among consumer hardware categories, 29% named AI wearables and personal devices such as smart glasses and health trackers as the leading driver of premium service revenue. The figures indicate that operators are also looking at AI-related demand from everyday connected devices, not only from large-scale cloud and industrial systems.

Providers also identified cloud partnerships as important to capturing GPU-as-a-service revenue. Some 94% viewed strategic partnerships with cloud and neocloud providers as essential to success, while 44% said revenue-sharing models would be their primary go-to-market approach.

Security focus

Security emerged as another major theme in the research. More than half of respondents said they had launched or expected to launch commercial quantum-safe encryption services, including QKD-protected links or PQC-ready managed security, within 12 months.

A further 48% said they were still in the early stages of development or evaluation. Respondents also cited advanced physical and cyber security as the main commercial driver for sovereign network infrastructure.

The survey indicated that operators were paying close attention to consistency as well as bandwidth. Thirty-five per cent identified network consistency, including stable performance and low jitter, as the top opportunity for monetisation through premium services.

In wholesale markets, 95% said rising demand from hyperscalers expanding AI infrastructure across multiple locations would make a substantial contribution to revenue growth. Distributed computing sites require tightly linked communications between facilities, adding to demand for high-capacity optical connectivity.

"The survey findings show that service providers are approaching AI with both optimism and urgency," said Brodie Gage, Chief Product and Technology Officer, Ciena. "Service providers see significant opportunities around AI inference, GPU-as-a-service, high-capacity network services, and quantum-safe encryption, while recognising that many existing networks must evolve to meet new performance demands. The message is clear: AI is creating new sources of revenue, and success will depend on having the network foundation to support them."