Report: Carrier Capex Increasing

BOSTON -- For the first time since the dot-com crash in 2000, telecommunications and data network service providers around the world are increasing their capital expenditures, especially on next generation technologies like packet voice and IP/MPLS routers, according to three of Infonetics Research’s Quarterly Service Provider Capex Analysis reports.

“At last we’re seeing positive, sustainable capex environments again,” said Kevin Mitchell, directing analyst for Infonetics Research and lead author of the reports. “In Europe, service providers are increasing capital expenditures by 11% in 2004 over 2003, and in Asia Pacific, they’re increasing capex by 5%. In both of those regions, competitive carriers are boosting their capex considerably more than the incumbents are. In North America, RBOCs and Canadian ILECs are increasing their spending, while IXCs, MSOs, CLEC/ISPs, and IOCs are decreasing spending, resulting in a projected 5% dip in overall North American service provider capex between 2003 and 2004. In all regions, the capex increases are generally going toward next generation technologies to introduce new service offerings and promote revenue growth."

2Q04 DSL Subscribers

2Q04 Capex-to-Revenue Ratios