US teardown specialist iSuppli says that 2007 will be a record year for equipment capital expenditure among telcos, who will spend some $41 billion on network equipment, as they chase an IPTV and triple play vision.
From 2008 through 2011, iSuppli projects equipment capex will remain steady at $40 billion as carriers look for positive returns on their investments made over the previous three years.
The US and Europe accounted for 60% of global equipment capex during 2006 as also the largest increases in spending came from there, as telcos aggressively pursue IPTV. The only region where spending declined was Japan because it had previously gone through a huge fiber-to-the-home build out.
Interestingly iSuppli said that capex by AT&T and Deutsche Telecom was less than expected, and we know that Deutsche slowed down its planned build out, when it changed CEOs earlier in the year backing off its plans to use VDSL. Developing regions like Russia, Brazil and Indonesia are turning to data services for the first time rather than IPTV, iSuppli said.