Rewheel/research

Unlimited mobile data and near zero marginal cost – a paradigm shift in telco business models

September 2017

European winners and losers in 4.5G and 5G – study of 30 operators. Will mobile network CAPEX stay flat in the long run?

Key findings

Mobile capacity abundance is disrupting converged operator fixed-line broadband centric business models
While data traffic increased up to 7 times the last four years mobile-only operator CAPEX fell or was mostly flat
Mobile-only and mobile-centric operators grew their mobile service revenue and cash flow the last 4 years
Mobile-only and mobile-centric operator service revenue growth was driven by market share gains, customers willingness to pay a bit more for unlimited plans and fixed-to-mobile broadband substitution gains
Converged operator mobile service revenue and cash flow continued to fall across the board
Despite the heavy investments in fiber fixed revenues continued to decline across the board
The fully allocated cost per gigabyte is a very unreliable (Mickey Mouse) metric
Peak speed network upgrades have driven mobile network CAPEX the last four years
Ultra-competitive network gear market feeds the flat mobile network CAPEX
CAPEX elasticity and the spectrum valuation CAPEX paradox
Will mobile network CAPEX stay flat in the long run?