Telenor has invested $14.2 billion – mainly towards capital expenditure (Capex) — between 2011 and 2015 in its 13 telecom markets across the globe.

$12.2 billion of this investment was related to Capex, according to a recent study by KPMG for Telenor Group .

Telenor has also acquired additional spectrum in Norway, Serbia, Myanmar, Hungary and Pakistan to expand the coverage and capacity of its LTE networks.

Telenor’s network Capex has focused on a combination of network modernization and expansion of its 3G and / or 4G networks. Approximately half of Telenor’s total capex over the last five years was committed to the network.

In many of its Asian markets, Telenor has made substantial investments in its network to increase its service offerings. In Myanmar, Telenor had 3G coverage of 62 percent of the population. In Pakistan, Telenor has made significant investments in network over the last 5 years, and in 2015 it witnessed its fastest growth of 3G users.

The non-network Capex by Telenor from 2011-2015 focused on spending on its IT services, as well as license and spectrum payments. In 2012, Telenor made $1.5 billion of license and spectrum payments across Bangladesh, India and Thailand.

In 2014 there was also an increase in non-network Capex, which was in part due to spectrum and license payments made in Myanmar.

In its Asian markets alone, Telenor has invested $6.8 billion in Capex over the last five years. Its investment has grown year-on-year between 2011 and 2015 by an average of 58 percent, reaching $1.8 billion in 2015.
Telenor has also been increasing its Capex in Europe over the past five years, though its Capex has grown at a lower rate between 2011 and 2015 in its European compared to Asian markets. Over the five years, Telenor’s Capex was $5.5 billion in Europe, of which $1.3 billion was invested in 2015.

According to the GSMA, over the period 2010-2015, mobile operators globally have invested more than $880 billion in Capex. Capex has been particularly high in developing countries, although across developing and developed countries alike it is expected to decline over the coming years as network improvements, including 4G rollout, are completed.

The volume of data traffic carried across Telenor’s Asian networks will increase thanks to investment in 3G and 4G networks, said KPMG. 37 percent of subscribers are active data users on Telenor’s Asian markets compared to the Nordics’ 73 percent share.

GSMA forecasts that data use in Europe will grow exponentially. Increasing and improving network capacity and speeds and migrating technologies is costly. Market trends will require Telenor to continue to invest in its businesses.

Telenor is making large portion of its revenue towards investment in networks.

In Norway, where data traffic more than doubled in 2015, Telenor’s Capex was $850 million, including Capex on upgrading infrastructure and networks. This Capex was 20 percent of Telenor in Norway’s 2015 revenues.

Telenor’s Capex intensity in 2015 was 45 percent across its 13 markets. In India, Telenor’s Capex intensity was over 300 percent. This means that Telenor invested $3 for every $1 of GVA it generated in 2015. Telenor was putting in three times as much investment as the economic value it generated.

In Myanmar, Telenor’s Capex intensity was almost 170 percent. Capex in Myanmar was $419 million due to the large investments in coverage and capacity required for the surge in traffic volumes and to connect extended parts of the population.

On November 26 2015, Telenor launched 4G services in Bulgaria under the LTE standard in the 1800 MHz band with a maximum data speed of 75 Mbps. In Q3 2016, Telenor’s 4G population coverage in Bulgaria is 79.8 percent.

Telenor’s network swap led to improved mobile data speeds and user experience. Telenor has reported over a 30 percent growth in total data traffic and a more than 20 percent growth in average individual data usage in Bulgaria between November 2015 and April 2016.

Baburajan K
[email protected]