Mobile broadband pushes telecom capex up 6pc

CALIFORNIA, USA: Telecom carrier revenue is forecast by Infonetics Research to grow to $2.17 trillion in 2015, driven by mobile broadband.

Infonetics expects global telecom carrier capex to total $310.8 billion in 2011, up 5.8 per cent over 2010.

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Stéphane Téral, principal analyst for mobile and FMC infrastructure at Infonetics Research, said: "The near-six per cent increase in global telecom carrier capex we expect in 2011 over 2010 is due in large part to AT&T's ramping LTE deployments, HSPA+ upgrades, and investments in WiFi hotspots for traffic offload. This offsets Verizon Wireless' slowing mobile spending since their LTE rollout peaked earlier this year."

In the 10 years from 2005 to 2015, telecom service provider revenue has shown and will continue to show year-over-year growth every year except in 2009.

Following a 4.1 per cent increase in 2010 over 2009, telecom service provider revenue will grow 7.6 per cent in 2011, to $1.86 trillion.

"In the EMEA region, a capex hike in Africa is partially offsetting delays in telecom investment in Greece, Italy, and Hungary; Asia Pacific remains stable; and in the Caribbean and Latin America, América Móvil and Telefónica, the two telecom giants that control 75 per cent of mobile subscribers there, are preparing their infrastructure to host the soccer World Cup in 2014 and the Olympics in 2016," asserts Téral.

Service provider spending on every type of next-gen telecom equipment except TDM voice is up in 2011.

Téral adds: "We maintain our view that the sovereign debt crisis that is paralyzing Europe continues to have little impact on our telecom capex forecast. As long as credit remains available to telecoms at a fair price, the ongoing sovereign debt crisis should have little impact on telecommunications equipment spending. Investment plans across world regions suggest mobile broadband and FTTx is the name of the game going forward."

The fastest-growing investment areas among telecom carriers in 2011 are WiMAX equipment (+27.5 per cent) and video infrastructure (+20.7 per cent).

The largest investment areas remain non-telecom/datacom equipment (software, real estate, labor, etc.) and mobile infrastructure, global spending for which is growing seven per cent and 8.6 per cent, respectively, in 2011 over 2010.

Asia Pacific will continue to be the largest telecom carrier capex region through 2015, driven by China Mobile, which ended 2010 as the world's largest mobile operator by revenue.

Wireless pure-play operators will grow to account for nearly 1/3 of all telecom carrier capex by 2015, it adds.