2025 preview: Asian telco trends to watch2025 preview: Asian telco trends to watch

As the new year begins, here is a list of five trends that will help shape telecoms in Asia in 2025.

1. Networks are increasingly vulnerable

Telco security has shot to the top of the agenda following the revelations of a devastating Chinese breach of US networks. Operators in frontline US allies in Asia such as Japan, Australia and India also face the threat of Salt Typhoon - if they haven't already been hacked.

Internally and externally, network security will be a very big deal this year. Telco execs are going to be reminded that if they want to remain in charge of critical infrastructure they need to keep it safe.

The other part of this is the rising geopolitical threat to subsea cables. 

East Asian waters are now clearly demarcated into China-friendly and US-friendly domains, and new cables are built accordingly. But the severing of multiple cables in the Baltic Sea, with strong (if not overwhelming) evidence of the role of Russian and Chinese vessels, as well as the repeated cuts to Taiwan Strait links, signals that underwater communications are increasingly vulnerable.

2. Power-hungry data centers face scrutiny

Plenty of Asian operators are leaning strongly into AI data centers (AIDCs) – Singtel, SoftBank, SKT and NTT to name a few – while China Mobile and China Telecom are running what are said to be the world's largest data centers.

It's a sector on an epic tear. IDC is tipping 41% CAGR growth over the next three years. But growing even faster is the power cost. Energy accounts for 60% of the running costs of a telco data center, IDC says, predicting AIDC power consumption will grow at 45% CAGR over the next three years.

Operators will need to find a way to tame the runaway energy costs. Not just for the bottom line but because it carries with it controversy and reputational risk. When the inevitable AI backlash begins, electricity-sucking data centers will be one of the first targets.

3. China's LEOsat surge

After years of effort, China's national low-Earth orbit (LEO) satellite project Guowang (aka GW) finally made it into orbit just before Christmas. But it's not even the first in China. It was scooped by the swifter Shanghai government-led G60 team, which hoisted its first batch into commercial orbit in August.

G60, also known as Qianfan, is aiming to have 648 satellites in operation by end 2025, and some 14,000 eventually. GW has also booked 14,000 satellite slots, while a third consortium, Hong-hu, is trying to enter the race.

These groups are years behind Musk's Starlink, but they will enjoy a monopoly in their home market and there's a chance at least one of them will become a competitor to western LEOsats in foreign markets. They are also an integral part of China's 6G preparations. But for 2025 the question is simply how many can they lift into orbit?

4. Huawei's smart driving

Huawei is back in the black after several years of losses, with much of the growth driven by its reborn handset division and its flourishing cloud services. But this year its auto business could be the one to watch. 

After spending 40 billion Chinese yuan (US$5.5 billion) on the unit over the past five years it is set to post its first profit. On January 1, Huawei merged the unit into its $16 billion smart auto solutions spinoff Yinwang, now a fully independent firm with 4000 software developers and backed by auto giant Changan. 

Separately, Huawei is striking its own partnerships with auto firms, most recently with the Guangzhou-based GAC Group, another industry heavyweight. With an expanding role at the center of the world's largest car market, and some of the biggest brands at its back, Huawei looks like it's on another winner.

5. U Mobile's wholesale 5G play

Malaysia's path to 5G has had more plot twists than a telenovela, and while the second wholesale network has finally been approved, questions remain.

Most of these relate to U Mobile, the small but politically connected operator that was inexplicably chosen to operate the second wholesale network.

U Mobile's first task is to find new investors, having been forced to slash the shareholding of Singapore's ST Telemedia. Most likely one or more local operators will step in, but it remains to be seen who and in what shareholding structure. It must then agree terms of access with retail operators, and, not least, design and build the new national network ahead of the government timetable. Malaysia heads into another year with a stack of 5G unknowns.