In line with historical trends, North American mobile operators will continue to invest twice as much in long-term assets as their counterparts in other world regions, according to ABI Research. The market research company forecasts North American mobile operators will make $63 in capital expenditures (Capex) for every subscriber in 2015.
“A distant second,” mobile operators in Western Europe, in contrast, will invest just $34 per subscriber in capex this year, ABI highlights in a press release.
North American mobile operators tend to spend 39 percent of capex on radio access networks. Just over a quarter (26 percent) of capex is invested in building out in-building wireless carrying capacity, “which now handles 80 percent of the mobile traffic,” ABI points out.
“Since large buildings have a significant impact on mobile network performance due to high user density, having sufficient coverage inside buildings can lead to improved customer satisfaction,” Core Forecasting Research Associate Lian Jye Su was quoted as saying. “Ensuring a high level of customer satisfaction has become an essential requisite for mobile operator competitiveness.”
Mobile Carrier Capex
All that said, ABI sees North American and global mobile capex “on a downward trajectory.” The market research provider forecasts mobile capex will peak at $224 billion in 2017 prior to the beginning of a prolonged decline. Slowing capex deployment “in light of declining wireless revenue” will fuel the trend.
“To reduce future CAPEX intensity, mobile operators are now looking at software-defined networking (SDN) and network functions virtualization (NFV). This allows the mobile operators to transfer their hardware based network to software- and cloud-based solutions,” Core Forecasting VP and Practice Director Jake Saunders commented.