ZTE wants to expand the role of telecom operators in the home. Connectivity remains the foundation, but AI services delivered on top should enable operators to generate new revenue.
The strategy is part of a broader shift at ZTE. “Before, we focused on connectivity; now we focus on both connectivity and computing,” says Michael Song, Vice President of Fixed & Multimedia Products in International Markets at ZTE.
ZTE ships more than 100 million home devices annually, Song says. Revenue from this business has grown by an average of more than 10 percent annually over the past five years.
From networks to services
For ZTE, the next step is for operators to monetize the infrastructure they have built. “Once an operator has built the network, the next step is to provide services and monetize that infrastructure,” says Song.
ZTE sees this as a multi-stage development. FTTH brought operators into the home, while FTTR gives them greater control over connectivity within it. “They can extend their reach into every room, not just the living room,” says Song. The next step is an interface through which operators can offer services.
At IBC 2026 in Amsterdam, ZTE presented its Smart Display for this role, combining a set-top box with a screen, speaker, camera, and local computing and storage. “In the future, it could become the AI entry point into the home,” says Song. Operators can use it to offer AI agents and other digital services.
Positioning against hyperscalers
This raises the question of why consumers would buy such services from their telecom operator when they already use services from Apple, Google and Amazon. Song believes the opportunity lies in the position operators already have in the home. Their networks can support services beyond entertainment, including security and smart-home functions. “It’s a very important AI entry point into the home. Operators can occupy that position.”
Operators could distribute third-party services as well as their own applications and AI services. “Based on the network and this interface, we can introduce our own services. Subscribers can choose.” In ZTE’s view, this creates an opportunity to capture part of the revenue generated in the service layer.
Digital human as an interface
Users can interact with these services through a ‘digital human’, a virtual human representation that can appear on different screens and provide access to AI agents and services. The distinction lies in their function: the digital human acts as an interface, while agents perform tasks behind it. “You’re not interacting with a machine; you’re interacting with a virtual human.” ZTE wants agents to move beyond answering questions and also perform actions on behalf of users.
Wi-Fi 8 follows quickly
More services over the home network also increase demands on its capacity, reliability and quality. Against this backdrop, ZTE is already looking at Wi-Fi 8, while commercial Wi-Fi 7 rollouts are only just getting underway at many operators. Song expects the cycle between Wi-Fi generations to get shorter. “Operators used to migrate to a new Wi-Fi generation roughly every five years. But in recent years, development has accelerated. Now it’s every two or three years.”
At MWC 2026 in Barcelona, ZTE demonstrated a Wi-Fi 8 ONT and access point and is working on more Wi-Fi 8 ONTs and CPEs. Standardization has not yet been completed. Release 1 of IEEE 802.11bn is expected by the end of 2027, followed by certification.
Rising bandwidth demand is driving interest in Wi-Fi 8, Song says, pointing to the progression from HD to 4K and 8K, as well as enterprise and AI applications. Orange, Telenor and Swisscom are among the operators already working on Wi-Fi 8, he says.
FWA remains part of the access mix. Where fiber is difficult to deploy, it can help operators reach customers sooner, Song explains, with migration to FTTH still possible once fiber becomes available.
More in-house computing technology
The shift towards AI is also changing ZTE. Alongside network hardware, the company wants to develop more of its own computing and software technology.
Software is becoming more important too. “Before, we focused on hardware manufacturing. But software is becoming increasingly important in the AI era.” Digital humans, AI agents and large language models require capabilities beyond ZTE’s traditional network hardware expertise.
Ultimately, ZTE wants to combine these elements in an end-to-end offering. “Before, we only provided individual components in the network. In the future, we want to cover everything from content and network infrastructure to home devices and control capabilities.”
The strategy affects both ZTE and its customers. For operators, Song argues, the goal should be not merely to provide AI infrastructure, but to secure their own position in the service layer.
