North American Mobile Operators Record the Highest Capital Expenditure per Subscription, For Now

23 Feb 2015

​Historically, North American mobile operators have invested twice as much capital expenditure (CAPEX) per subscription as their global counterparts. This year, the scenario remains the same: ABI Research forecasts North America CAPEX per subscription to be US$63. In comparison, Western Europe is at distant second with US$34.

For North American mobile operators, 39% of the CAPEX is spent on radio access networks. At the same time, 26% of the spending is on in-building wireless, which now handles 80% of the mobile traffic. “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. Ensuring a high level of customer satisfaction has become an essential requisite for mobile operator competitiveness,” comments Lian Jye Su, Research Associate of Core Forecasting.

However, ABI Research believes that North American and global mobile CAPEX per subscription are on a downward trajectory. ABI Research forecasts global total mobile CAPEX to reach its peak at US$224 billion in 2017, before it starts to decline mainly driven by a slowdown in CAPEX deployment, in light of declining wireless revenue. “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,” adds Jake Saunders, VP and Practice Director of Core Forecasting.

ABI Research’s study, Mobile Operator CAPEX Market Data focuses on the regional and global mobile operator capital expenditure which includes base station and core network spend. It is part of ABI Research’s Mobile Deployments, CAPEX, and Traffic Market Research.

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