Carrier Capex Rising

According to this report from Infonetics, telecom carrier capital expenditures are continuing a comeback trend:

North American Telecom Carrier Capex to Grow 5% to $61B in 2005 After Holding Steady in 2004

The 5% growth comes after only a fraction of a percent growth in 2004, but that was after three years of "drastic cuts," according to Infonetics analyst Kevin Mitchell. "Another noteworthy trend," says Mitchell, "is how fast mobile subscribers are closing in on access lines, with mobile subscribers now at 90% of PSTN lines, up from 77% at the close of 2003. North American mobile subscribers grew 13% between 4Q03 and 4Q04, from 145 million to 164.3 million. We could easily see mobile overtake access lines in 2005."

Infonetics' release cites these telecom capex highlights from 2004:

-- DSL subscribers increased 44% between 4Q03 and 4Q04 to 16.5 million
-- Cable Internet subscribers increased 27% between 4Q03 and 4Q04 to 21.4
million
-- RBOCs and Canadian ILECs increased their capex in 2004 and will
increase it again in 2005, particularly on IP/MPLS routers
-- Cable companies decreased their capex between 2003 and 2004, but will
increase spending a bit in 2005, mostly on voice equipment and IP/MPLS
routers
-- Broadband lines equaled 21% of access lines in North America
-- North American carrier revenue is projected to be flat in 2005 after
inching up in 2004

AB -- 4/7/05