Don't just sprinkle AI features onto your existing product ('AI at the edge'). Transformative companies rethink workflows and shrink their old codebase, making the LLM a core part of the solution. This is about re-architecting the solution from the ground up, not just enhancing it.

AI is forcing telecommunication companies to move beyond providing simple connectivity ('dumb pipes'). To stay relevant, they are investing heavily to modernize networks to power edge AI applications like autonomous driving and robotic surgery. This positions them as critical enablers in the AI value chain, not just infrastructure providers.

Previous technology shifts like mobile or client-server were often pushed by technologists onto a hesitant market. In contrast, the current AI trend is being pulled by customers who are actively demanding AI features in their products, creating unprecedented pressure on companies to integrate them quickly.

Lumen identified that real growth is in 'east-west' data traffic—data moving between clouds and data centers—not the commoditized 'north-south' traffic from a user to the cloud. Acquiring Alkira accelerated its ability to serve this high-growth, complex market, creating a key strategic differentiator.

For an existing SaaS company to become a credible AI player, it must do more than add features. It requires a fundamental reinvention, akin to 'open heart surgery.' This means re-architecting to be agent-first, shifting to outcomes-based pricing, and even rebranding—as seen with Intercom becoming Finn—to attract new funding.

In the early 2010s, enterprises were highly skeptical of the cloud. Today, those same companies are actively experimenting with and spending on AI. They perceive it as a more significant opportunity and threat than the cloud was, having learned from their past hesitation, creating a massive demand-side pull for AI solutions.

While the market focuses on AI regulation, data center booms, and cloud provider competition, Lumen's CFO argues the most important trend is underlying enterprise adoption of AI. This is the 'low risk' signal their growth strategy is tied to, insulating them from market volatility.

The transition to AI is a platform shift potentially larger than mobile. As argued by OpenAI CEO Sam Altman, companies built from the ground up with AI at their core have a fundamental DNA advantage over incumbents who are simply adding AI capabilities to existing products and workflows.

When generative AI emerged, the team feared their existing product would become obsolete. Instead of retrofitting AI features, they made the strategic decision to rebuild the entire platform from the ground up with AI at its core. This allowed them to realize their long-term product vision.