CAPEX vs. OPEX Models for Private Networks: Why Renting is Not Always Better than Buying

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By Leo Gergs | 4Q 2021 | IN-6294


CAPEX and OPEX Announcements in the Private Network Domain


If you look at the current private networks’ discussion, it has centered around how to provide the entire End-to-End solution in an as-a-Service business model for enterprises (monetization would therefore happen through operational expenditure, OPEX). While the idea behind this very valid (reducing upfront investment necessary from an enterprise point of view), it does not consider that in this model, enterprises will never fully own their connectivity infrastructure and therefore would always be dependent on a third party. Furthermore, the ownership of vital production infrastructure is often seen as an important economic asset and therefore increases enterprises’ readiness to invest some capital expenditure (CAPEX) to acquire network infrastructure.

On a different note, considering recent developments within the telecom domain, such as Elisa acquiring software house TenForce, camLine Group, and CalcuQuote in 2021 and Microsoft acquiring the likes of Affirmed Networks and Metaswitch, it is therefore time to revisit the OPEX versus CAPEX discus…

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