LTE Capex of China telecoms drops 16% in 2016

LTE subscriber base of China telecom operatorsLTE Capex (capital expenditure) of mobile operators in China fell 16 percent in 2016 due to network sharing deal between China Unicom and China Telecom.

The 2G, 3G and 4G mobile infrastructure market — based on telecom operators’ investment — in China decreased 9 percent in 2016 to $12 billion, said IHS Markit.

China Mobile is the largest 4G operator in China — well ahead of China Unicom and China Telecom.

ALSO READ: IHS Markit report on LTE Capex of China operators

The Chinese mobile infrastructure macro hardware market — based on telecom operators spending — is forecast to decline at 34 percent CAGR (compound annual growth rate) from 2016 to 2021.

China, the world’s largest mobile subscriber base, had 1.3 billion mobile subscribers in 2016. China Mobile’s GSM / TD-SCDMA / LTE network accounts for 64 percent of total subscribers in China. 58 percent of China’s mobile subscribers are now on LTE against 32 percent in 2015.
LTE traffic growth chart by EXFO
LTE traffic growth chart by EXFO

China Unicom and China Telecom’s addition of FD-LTE eNodeBs and China Mobile’s moderate TD-LTE rollouts led to a combined total of 1,020,000 eNodeBs deployed — the same number as in 2015, said IHS Markit.

The overall 2G/3G/LTE mobile infrastructure market fell 9 percent to $12 billion in 2016, at a time when China Unicom and China Telecom were building their nationwide FD-LTE rollout.

LTE revenue of China Mobile, China Unicom and China Telecom declined 4 percent to about $10 billion in 2016, sustained by flat eNodeB rollouts, and leaving combined 2G and 3G revenue at less than $2 billion.

IHS Markit forecasts that the mobile infrastructure macro hardware market in China will post a double-digit decline in 2017 due to the end of massive LTE rollouts.

“Chinese RAN and packet core infrastructure market will slow down further to $2 billion in 2021, a -34 percent 2016–2021 CAGR,” said Stephane Teral, senior research director and advisor, mobile infrastructure and carrier economics, IHS Markit.

The IHS Markit report is silent about leading mobile infrastructure vendors such as Nokia, Ericsson, Huawei and ZTE. Both Huawei and ZTE rely on China telecom operators and their LTE investments for future growth.

ZTE yesterday announced double digit revenue growth in the first quarter of 2017. But the China based telecom equipment maker did not cite 4G as the main reason for its growth.

Baburajan K

Latest

More like this
Related

Samsung leads LATAM smartphone market in Q3 2024

Latin American (LATAM) smartphone market grew by 11.2% year-on-year...

Global foundry industry revenue soars on AI, smartphone demand

The global foundry industry recorded a 27% year-on-year (YoY)...

Strategies for improving energy efficiency in mobile networks

GSMA Intelligence has shared some of the strategies for...

How AI can drive energy efficiency in telecom networks?

A report from GSMA Intelligence has identified how AI...