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2013 LTE RAN capex to hit $12B mark

Posted: 23 Apr 2013 ?? ?Print Version ?Bookmark and Share

Keywords:market analysis? LTE? capex? radio access network? TD-SCDMA?

As countries around the world move on to high-speed connections, spending on Long-term Evolution (LTE) base stations will reach $12.3 billion in 2013, according to ABI Research. This forecast is not only for developed countries but emerging markets are also aggressively rolling out high-speed connections. Examples of emerging markets with LTE deployments are the government sponsored initiatives in Rwanda and private ventures in Sri Lanka.

LTE has helped to reverse the downward trend in radio access network (RAN) expenditure in Western Europe last year and will do the same in Eastern Europe, Latin America, and Middle East in 2013 and Africa in 2014.

LTE subscriptions in Asia-Pacific are also forecasted to reach 72.1 million by the end of 2013. (See LTE smartphone vendors to sell 275M units in 2013.

"There are, however, differences in the type of capital expenditure (capex) incurred in different regions. Operators in the developed markets are already taking steps to upgrade their networks to LTE-Advanced this year. (See 3G/LTE baseband market grew 892% last year.) Going forward, amidst skyrocketing data traffic, they will also invest a larger proportion of their RAN spend on LTE small cells, which will yield significant savings on capex in addition to increased capacity for wireless operators," noted Ying Kang Tan, research associate at ABI Research. Besides tangible infrastructure, intangible LTE spectrum licenses also have cost operators dearly. For example, the 4G mobile spectrum license acquired by France's SFR constituted 38.9 per cent of its capex last year. Mobile carrier capex can be quite 'lumpy.' The year 2013 will see a sharp reduction in China Mobile's 3G investments in TD-SCDMA. In other markets, 3G equipment spending has already declined. "4G equipment spending is taking up some of the slack but there will still be a 6 per cent drop this year," commented Jake Saunders, VP and practice director of core forecasting. "2014 should see rising wireless investment as 4G deployment and capacity build-up gain momentum."

ABI Research's "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 Capex Database.

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