According to a recent report by KPMG, India, artificial intelligence (AI) is playing a pivotal role in reshaping technology, media, and telecommunications (TMT) operations by improving efficiency, personalising experiences, and enhancing decision-making. From automating networks in telecom to delivering personalised media content, AI is streamlining processes and unlocking new opportunities for growth.

The report is based on a survey of industry leaders including chief development officers (CDOs), chief technological officers (CTOs), and chief information officers (CIOs). It revealed that 55 per cent of TMT organisations have fully integrated AI, with 37 per cent in the scaling phase. AI-driven innovations have already delivered significant results, including a 5-10 per cent reduction in operational costs and over 10 per cent returns on AI investments for 67 per cent of respondents.

Further, the report highlighted that 55 per cent organisations are classified as ‘AI Pioneers’, having successfully implemented AI at full scale for select use cases. Meanwhile, 32 per cent are considered ‘AI Evangelists’, currently in the process of gradually scaling their AI initiatives. 13 per cent are labelled as ‘AI Explorers’, still in the initial planning stages of adopting AI technologies. 55 per cent respondents anticipate that 30-50 per cent of their product or solution portfolios will be AI-led, with expectations that these AI-driven offerings will contribute 10-30 per cent of incremental revenue.

The report added that 65 per cent of Indian chief experience officers (CXOs) strongly agreed that leveraging generative AI (GenAI) will provide a significant competitive advantage, highlighting its strategic importance in the TMT sector. 52 per cent organisations report enhanced customer service by utilising AI to improve technology and network performance metrics, leading to better observability and service enhancements. 67 per cent companies have begun generating returns in excess of 10 per cent on their AI implementations, building a compelling case for widespread adoption across the sector. 40 per cent companies are adopting AI within finance and HR functions to achieve better predictability in operations and decision-making processes.

Furthermore, telecom executives are seeing high levels of AI adoption, with 30 per cent focusing on improving service quality. Additional areas of impact include revenue growth (26 per cent), fraud prevention (32 per cent), and delivering better customer experiences (12 per cent).

As per the report, there exist some key challenges – 26 per cent respondents cite a lack of skilled workforce and awareness as significant inhibitors to AI adoption, while 27 per cent report high overall costs of implementation as the top barrier, alongside challenges such as lack of accurate data and IT security and privacy concerns.

It noted that 33 per cent participants believe that 30-50 per cent of their workforce will be AI-ready by financial year 2025-2026, underscoring a strong focus on reskilling and upskilling initiatives. Moreover, according to KPMG’s Global chief executive officer (CEO) survey, 80 per cent CEOs agree that investing in skill development is essential for organisations.

The report highlighted some suggestions to accelerate AI Adoption in the TMT sector, including:
• Cross-sector collaboration- Partner with industries like healthcare and manufacturing to provide AI solutions for predictive analytics and customer engagement.
• Strategic partnerships- Collaborate with specialised AI providers to access advanced technologies and accelerate innovation.
• Develop talent- Invest in upskilling through partnerships with universities to create AI curricula focused on network automation and cybersecurity.
• Responsible AI practices- Implement frameworks ensuring fairness, transparency, and regular audits of AI models to mitigate bias.

For policymakers:
• Governance frameworks- Develop regulations that balance innovation with responsible AI usage. Establish ethical standards, ensure transparency in AI systems, and implement strong data privacy laws.
• Support research and development (R&D)- Fund initiatives and establish Centres of Excellence to keep the TMT sector competitive.
• Public-private partnerships- Foster collaborations to accelerate AI deployment in infrastructure and public services.
• National training programs- Work with TMT companies to create educational initiatives that bridge the AI skills gap.

Commenting on the report, Akhilesh Tuteja, partner and national leader, TMT, KPMG in India, said, “The TMT industry stands at the cusp of a remarkable transformation, driven by the rise of AI. As the global landscape rapidly embraces a digital-first future, AI is emerging as a transformative force, reshaping not just the TMT industry but all other industries. This pivotal moment offers the sector an opportunity to redefine its role as a catalyst for change, fostering advancements across industries and ensuring that the far-reaching benefits of AI are realised by all.”

Meanwhile, Purushothaman KG, partner, head technology transformation and sector head, telecommunications, KPMG in India, said, “The insights from this report highlight the significant impact AI is set to have across TMT landscape. Our findings suggest that organisations adopting AI technologies are not merely enhancing their operations; they are also fundamentally reshaping customer experiences and driving innovation in ways we have not seen before. For companies in TMT sector, the message is clear: those who embrace AI and invest in robust strategies to integrate these technologies will emerge as leaders in a highly competitive environment. As we move forward, collaboration, skill development, and ethical AI practices will be critical in unlocking the full potential of this transformative technology.”

Further, Hemant Jhajhria, partner and head of consulting, KPMG India, said, “AI is revolutionising the TMT sector in customer service, network optimisation, marketing personalisation and fraud detection. At KPMG in India, we see AI not only as a technological advancement but as a strategic enabler that positions companies at the forefront of innovation and growth. This report provides a roadmap for organisations to navigate the complexities of AI adoption, ensuring they leverage its full potential for sustainable success.”

Furthermore, Naveen Aggarwal, office managing partner, Delhi NCR, KPMG in India, elaborated, “Organisations that strategically integrate AI as a core element of their business model are not only gaining a competitive advantage but also setting new benchmarks for operational excellence and customer engagement. By leveraging AI, these organisations are boosting revenue, streamlining processes, enhancing decision-making, and ensuring regulatory compliance.”