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Orange, Fastweb, Swisscom, Telefónica and Telenor are among the telcos embracing sovereign AI.
Joanne Taaffe, TM Forum
Telcos step up to sovereign AI challenge
Telcos are carving out a role for themselves in the growing demand for sovereign AI solutions as governments invest in homegrown algorithms and infrastructure to protect national interests, critical data and economic productivity.
Richard Windsor, financial analyst and founder of research firm Radio Free Mobile, noted it is the “first time that governments have really gotten on board with a technology trend.”
He went on to add in a research note that “sovereign AI is an emerging subsector of the AI industry and one where the size of the opportunity for the AI infrastructure providers is very likely being grossly underestimated.”
NVIDIA is one company that is already fully cognizant of the sovereign AI opportunity. It claims there are now 18 telco-led AI Factories powered by its tech across five continents. And it has just announced new collaborations with Orange, Fastweb, Swisscom, Telefónica and Telenor.
Speakers from Orange, Swisscom and Telenor at Nvidia’s GTC event in Paris this week outlined how they see telcos’ strengths in the sovereign AI space, starting with their long history of operating national infrastructure.
“We own the core infrastructure of the nation and sometimes we are the resilience of the nation...And we know how to work with regulators… and that’s a key asset,” according to Espen Halvorsen, VP Partnership Strategy—Technology Strategy and Partnership Ecosystem atTelenor.
Indeed, Telenor’s Halvorsen believes more regulation could work in telcos’ favour. He emphasized the importance in Norway of “being close to the politicians and to the regulators and to understand that we have common ground,” adding that “we need to do that pretty fast. We need more speed, we need more alignment.”
Silvan Lohri, Head of the AI Transformation Office at Swisscom, pointed out that “we now have all the ingredients we need in Europe,” and hopes that sovereign AI will stretch beyond national borders.
Sovereign AI is not just a question of data center infrastructure equipped with GPUs.
“The top layer ... is super important,” according to Lohri. “So, software applications… large language models. Not only having the infrastructure, the data center but also make sure that the software … are Swiss-based or can be encapsulated in a solid way.”
For now, around 70 governments have said they will invest more than $900 billion into national sovereign AI projects, according to Calista Redmond, VP, Global AI Initiatives, NVIDIA.
The $500bn Stargate Project in the US is a prime example. The French government recently announced private sector investment commitments of €109bn to build AI infrastructure and capabilities in the country.
In Canada, the government plans to invest CA$2bn over five years in the Canadian Sovereign AI Compute Strategy.
Telus offers an example of what telcos are doing on the ground. It is building two Sovereign AI Factories in British Colombia and Quebec and deploying NVIDIA’s Hopper- and Blackwell-based supercomputers in each facility, as part of a CA$70bn five-year investment plan. The site in Quebec is scheduled to start operations this summer.
Hesham Fahmy, Chief Information Officer at Telus, said the AI factories will be a “game changer” for the country and the operator, speaking during RCR Wireless’s “Telco AI Forum 2025”. The operator is addressing several dimensions of sovereign AI, including availability of GPU resources, control of the control plane and security and privacy.
“You can’t control your destiny if you don’t have the compute infrastructure to run AI workloads, whether it is for training your own models, building your IP or for inference,” he said.
When it comes to the control plane, he said partnering with hyperscalers is “sufficient” in some cases. However, “even if the data center sits within the country and the control plane is controlled by a foreign entity, that still may be too much risk to take on,” he said.
And to ensure privacy and security, it is important that the data and all the network paths in and out of the data center reside within Canada’s borders, he added.
Telus sees clear revenue opportunities from the Sovereign AI Factories, not only from providing GPU-as-a-service but also from its Fuel iX GenAI platform for enterprises delivers additional services on top of the basic compute.
In addition, Fahmy anticipates the sites to generate other benefits that will drive growth for the operator.
“If an operator can make AI more accessible, then companies and institutions can leverage AI and increase their productivity. Then the tide rises all boats….[For telcos], there is the direct monetization from selling the service and there’s the indirect [benefit] because your overall economy and customer base prosper, when then drives more revenue, expansion, growth and use of your services,” he said.
Orange is also eyeing revenue growth from sovereign AI services, with the aim of tailoring services to specific enterprise requirements.
“Sovereignty is not a flip switch it’s a dimmer switch. It can be extremely private super sovereign or less so,” said Usman Javaid, Chief Products and Marketing Officer, Orange, speaking at GTC Paris. All depends on customers’ concerns about factors such as where data resides, the extent to which an LLM is ethical, and partners within the wider ecosystem.
“We want to offer sovereignty-as-a-service which means we should have a dimmer switch in every product and service and customers can …have the maximum choice in terms of trusted data,” says Javaid.
