Tuesday, September 30, 2014

Dell'Oro: Worldwide Carrier CAPEX to Decline $6B in 2015

Worldwide telecom carrier CAPEX is forecast to decline by $6 billion in 2015, according to a newly published Carrier Economics report by Dell'Oro Group.  The expected decline follows growth rate in the mid-single digits for 1H 2014. Double-digit growth in mobile network infrastructure significantly outpaced the low single-digit growth in service revenues.


"While we maintain our view that worldwide Capex will grow around 3% in 2014, we believe multiple factors will contribute to a decline in Capex during 2015,” said Stefan Pongratz, Dell’Oro Group’s Carrier Economics analyst. “Higher device penetration, decelerating mobile data growth rates, lack of new revenue streams, and increased competition in both the developing and developed markets have caused worldwide revenue growth to decelerate in the last couple of years.  Slower growth in service revenues coupled with the rapid network progress during 2014 in China, North America, Japan, and Europe will also put some pressure on worldwide Capex upside in 2015,” continued Pongratz.

Other Dell’Oro Group Carrier Economics Report highlights:

  • The amount of mobile Capex required to support incremental mobile data usage has declined more than 50% per year since the smartphone boom started.
  • Fiber and LTE coverage build-outs will continue to drive telecom equipment investments in 2H14 and 2015.  The proportion of Capex that will be allocated to new technology enablers and network topologies including NFV and small cells is expected to be negligible over the next six quarters.

http://www.delloro.com/news/worldwide-telecom-carrier-capex-forecast-to-decline-6-billion-in-2015

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