According to a new report from the Telecommunications Industry Association, U.S. wireless carriers will spend a total of $159.3 billion on wireless network equipment and infrastructure during the next four years, up fully 40 percent from the $113.9 billion in cumulative spending during the previous four years. However, TIA pointed out, overall growth in spending is slowing as carriers like Verizon Wireless (NYSE: VZ) and AT&T Mobility (NYSE: T) finish their initial LTE network buildouts.
In the association's new ICT Market Review and Forecast report, TIA found that during the past two years, overall wireless equipment and infrastructure spending totaled $63.7 billion, which the firm said was 33 percent higher than in 2011. "With much of the LTE footprint and related infrastructure now in place, we expect slower growth over the next four years," the firm wrote, noting though that increasing wireless data traffic will continue to force carriers to invest in base stations, backhaul and core networks, which will boost overall spending.
The firm said that overall wireless equipment and infrastructure spending in the United States will total $43 billion in 2017 from $33.6 billion in 2013, increasing at a 6.4 percent compound annual rate.
As for cell sites specifically, TIA said that the number of cell sites jumped 12 percent in 2011 in advance of LTE rollouts, and has risen an additional 12.6 percent cumulatively during the past two years. "We project the overall number of cell sites in the United States to grow 18.5 percent during the next four years to 378,000 in 2017 from 319,000 in 2013, a 4.3 percent increase on a compound annual basis," the firm noted.
As for its measurement of the total wireless market--which includes spending on voice and data services, wireless handsets, wireless infrastructure equipment, and services in support of the wireless infrastructure--the firm said that figure will reach $300.4 billion this year and increase to $381.9 billion in 2017.
In other key findings from TIA's report:
- The firm expects consumer spending on data to overtake consumer spending on voice this year, and that by 2017 data will account for roughly 60 percent of consumers' spending.
- The firm said LTE-enabled smartphones sold in 2013 used 40 percent more data than the 3G smartphones sold in 2012.
- In 2013, average revenue per user (ARPU) rose 5 percent, TIA said. The firm said ARPU will grow to $59.75 in 2017, a cumulative 18.7 percent increase from $50.35 in 2013.
Verizon and AT&T have largely completed their respective LTE buidouts, with AT&T covering nearly 300 million people and Verizon covering slightly more than 300 million people. Sprint (NYSE: S) and T-Mobile US (NYSE:TMUS) are in the midst of finishing their initial LTE buildouts. However, carriers are now turning toward network densification techniques including adding small cells and additional spectrum channels to their networks. Further, the FCC is auctioning additional spectrum to wireless carriers later this year and next year, and carriers will likely spend billions of dollars building out that new spectrum.
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