Telecoms investments have declined, for the first time since 4Q20, by 5 percent to $77 billion in 3Q22. The drop in Capex of telecom operators in the latest quarter also knocked down annualized Capex to $325.7 billion in 3Q22, from the peak of $329.5 billion in the prior annualized quarter.
Capex will reach $330 billion in 2022, MTN Consulting said in its report. A few countries are starting to deploy 5G network notably India; many more continue to scale up 5G to reach mass market coverage, and deploy fiber to support fixed broadband and to connect all the new radio infra (including small cells) needed for 5G.
The Ericsson Mobility Report in November said 5G subscriptions grew by 110 million during the third quarter of 2022 to around 870 million. 5G subscriptions are expected to reach 1 billion by the end of 2022, showing telecoms are making investment in 5G network.
North America and North East Asia are expected to have the highest 5G subscription penetration by the end of 2022 at around 35 percent, followed by the Gulf Cooperation Council countries at 20 percent and Western Europe at 11 percent.
Subscriptions for 4G grew by 41 million during Q3 2022 to around 5 billion. 4G subscriptions are projected to peak at 5.2 billion by the end of 2022.
Annualized capital intensity reached a new all-time high of 17.9 percent in 3Q22 from 16.8 percent in 3Q21. The previous high of 17.8 percent was recorded in 2Q22; another notable peak came in 1Q16 at 17.5 percent, amidst the LTE boom.
Japan’s Rakuten is leading with a roughly 145.1 percent Capex/revenue ratio on an annualized basis.
Globe Telecom’s capital intensity for the annualized 3Q22 period stood at 59.1 percent, the highest among established operators. Globe’s network infrastructure buildup includes 1,080 new cell sites, upgrades to at least 12,900 sites including both 4G LTE and 5G, and installation of over one million fiber-to-the-home lines.
PLDT’s annualized capital intensity stood at 52.9 percent in 3Q22, as spending ramped both for meeting connectivity demands and taking on new competition from the new mobile player Dito Telecommunity Corp.
The biggest Capex spender in 3Q22 on an annualized basis was China Mobile with $28.2 billion. Annualized growth of China Mobile slowed down to 2.6 percent in the latest quarter due to the telecom’s efforts to share costs on the network side enabled by a partnership with China Broadcasting Network. China Mobile’s single-quarter Capex declined by 13.3 percent.
Five out of the top 20 mobile operators by annualized Capex spend posted double-digit growth rates in the period ended 3Q22. Some of these include: America Movil (48.1 percent vs. annualized 3Q21), BT (32.2 percent), Verizon (24.3 percent), AT&T (16.8 percent), and Charter Communications (11.9 percent).
Telecoms industry revenues dropped 6.6 percent to $435 billion in the latest single quarter ending 3Q22. The quarterly dip was the fourth consecutive slump and surpassed 2Q22’s 6.2 percent decline to post the steepest falloff since 3Q15.
Telecoms industry headcount was 4.59 million in 3Q22, down from 4.7 million a year ago, according to MTN Consulting. Telecomlead