Wireless sharing saves 30% in capex and 15% in opex

Operators who jointly roll out a new-build LTE network of 2500 sites in a developed economy will typically realise 30% in capex savings accumulated over five years and will also achieve a 15% reduction in opex per year by year five, according to a new Analysys Mason report Transform the economics of your wireless business with infrastructure sharing.
According to the report by Analysys Mason, operators have shown renewed interest in network sharing in recent years.

“The conditions for mobile infrastructure sharing are arguably more favourable than they were ten years ago. Regulators and operators are more successful in reaching agreement on networking-sharing deals,” said Terry Norman, Principal Analyst at Analysys Mason and author of the report.
The analysis shows that the amount that an operator can save depends upon the depth of the sharing arrangement. Options range from passive forms, such as site sharing, to active forms, such as full spectrum and radio access network (RAN) sharing. Mobile network operators (MNOs) can also share elements of their core networks. The potential cost savings and benefits increase as the depth of the sharing increases, but so do the risks.

“Operators who do not reduce their costs will eventually go out of business: sharing network infrastructure substantially reduces costs,” says Norman.
Many pressures are driving MNOs to consider infrastructure sharing as a means of reducing costs and improving margins.

Operators face the growing challenge of maintaining multiple networks with multiple technologies (GSM, HSPA and LTE), which pushes up the costs of network operation and maintenance. Site-related opex is increasing in many markets — particularly as a result of the rising costs of site rental and power. Macroeconomic conditions continue to be very challenging, which makes access to funding difficult and the cost of borrowing high.

The report predicts that the total data traffic volume in 2015 will be more than thirty times that in 2010. MNOs will need to make capital investments to increase capacity in order to meet this demand — all this at a time when ARPUs are flat to decreasing and penetration rates are stagnant.

The report considers the impact of sharing upon the GSM, UMTS and LTE business models in both developed and developing countries. We estimate savings in both capex and opex. We analyse market drivers for sharing such as cost reduction, regulatory support and vendor support. We also review a series of case studies and lessons learned from the sharing marketplace.
The report includes operator case studies of Orange, Vodafone, Tele2, Telenor, 3, T-Mobile, Bell Mobility, Telus and more. It also considers the Indian, Chinese and Brazilian regulators' approaches to sharing, and features key sharing suppliers, including Nokia Siemens Networks, Huawei and Ericsson.