AT&T Driving Up Global Capex Average?

Infonetics Research Inc. says that global telecom capital expenditure will grow almost 6 percent to $311 billion in 2011 and puts that mostly at the feet of AT&T Inc. (NYSE: T)'s spend on Long Term Evolution (LTE) and other things.

Specifically, Stephane Teral, principal analyst, mobile and FMC infrastructure at Infonetics, writes: "The near-6 percent increase in global telecom carrier capex we expect in 2011 over 2010 is due in large part to AT&T's ramping LTE deployments, HSPA+ upgrades, and investments in Wi-Fi hotspots for traffic offload."

Really? A global increase in capex spend is largely due to AT&T, with all the other next-generation projects around the world? The operator did say in July that it would up its spend this year to $20 billion to improve wireless capacity. (See AT&T Ups Capex to $20B to Develop 3G & LTE.)

Now recall that Ma Bell only really started the commercial launch of LTE late this summer and we can maybe extrapolate that its capex spend for 2012 is likely to be solid too. Although we don't know exactly how much new backhaul is in place already to support LTE as it launches. AT&T was definitely trying to update its backhaul network with the HSPA+ upgrades it has been doing on the 3G network. Backhaul upgrades are likely to be a good part of any capex costs.

— Dan Jones, Site Editor, Light Reading Mobile

JohnMike 12/5/2012 | 4:49:07 PM
re: AT&T Driving Up Global Capex Average?

You both got it wrong ...

Yes, AT&T has guided to $20 billion in capex for 2011 but that total includes both wireline and wireless networks! (You can look it up!)

AT&T Mobility's portion will come at around $9.4 billion for the year; but that's less than 50% of AT&T's projected total 2011 capex (You can look it up!)

Certainly AT&T Mobility is the biggest spender in the U.S. market this year but that amount is hardly a swing factor on a global scale.

I'm tired of wannabe market analysts making bold proclamations, and incorrectly influencing opinion, on wireless industry trends and scenarios for which they have little or no understanding of the details.

Kim Peinado 12/5/2012 | 4:48:56 PM
re: AT&T Driving Up Global Capex Average?

Hey guys - read the rest of Stephane's quote: "In the EMEA region, a capex hike in Africa is partially offsetting delays in telecom investment in Greece, Italy, and Hungary; Asia Pacific remains stable; and in the Caribbean and Latin America (CALA), América Móvil and Telefónica, the two telecom giants that control 75% of mobile subscribers there, are preparing their infrastructure to host the soccer World Cup in 2014 and the Olympics in 2016."

When he noted AT&T and Verizon, it was in context of mainly North America (and he didn't say all of AT&T's investments were going into wireless).

His comment was meant as a high-level summary of some of the main drivers behind the overall capex increase. Period.

Sign In