Network costs are going up, says Nokia CEO

It’s almost a perfect storm out there for mobile operators (carriers):

  • revenues have stagnated or decreased over the last 2 to 3 years
  • investment in 4G has to continue in most countries, especially with government rural coverage commitments
  • consumers still want to pay the same every month but get more data
  • 5G investment has to run in parallel with 4G yet actual capex spend remains the same
  • Shareholders want to see margin increase, that means more free cashflow, for greater dividends
  • Consolidation has been held back with regulatory issues
  • Spectrum costs have levelled but still bear heavily on cash
  • Most operators are heading for Net Zero by 2030-50, that will cost more
  • Energy efficiency is proving hard to do, 5G does mean more energy usage

And now the cost of building and operating networks is going up with chip shortages, rising labour costs, rising energy costs and so on.