Wednesday, January 30, 2019

Telenor Says 5G Will Not Boost Capex

Norway's Telenor, which plans to launch 5G services in Norway in 2020, also says it has no plans to boost overall capital investment (except for the costs of spectrum).

The operator said it would invest between 16-17 billion Norwegian kroner (US$1.9 to $2 billion) in capital expenditure in 2019, excluding the cost of spectrum licenses, after spending  NOK16.8 billion ($2 billion) in 2018.

That seems to be part of a trend in developed markets, where business risk is mitigated, in part, by phased deployment to complement 4G, which also is getting better. Also, new studies suggest 5G capex requirements will not be as onerous as originally believed.

More to the point, several mobile service providers already are saying that 5G capital expense will not exceed present levels of spending, or will increase only slightly, as is typical whenever a next-generation network starts to be deployed. Swisscom, 3UK, Verizon and AT&T are among firms in addition to Telenor signaling flat capex as 5G is introduced.  

That might come as quite a relief t some, a surprise to others, who had forecast 5G capital investment so high many operators could not afford it.  

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