Telecoms Industry Faces Growth Challenges, Yet Revenue Set to Reach $1.1 Trillion by 2028
The global telecoms industry is expected to see steady revenue growth despite significant challenges, with projected revenue reaching $1.1 trillion by 2028. According to PwC’s Global Telecoms Outlook, the industry will grow at a compound annual growth rate (CAGR) of 2.9%, slower than inflation. In 2023, telecoms revenue across mobile and fixed verticals grew by 4.3%, reaching $1.1 trillion, but the outlook remains under pressure due to rising costs, competition, and a slowdown in subscriber growth.
While the sector shows growth in terms of volume, average revenue per user (ARPU) is expected to decline by 2% annually until 2028. Key areas like mobile, fixed broadband, and voice services will see ARPU drops, with mobile ARPU declining at a CAGR of -1.3%. Despite these trends, fixed broadband and mobile subscriptions are predicted to grow annually by 3.8% and 4.3%, respectively. However, the report highlights that there will be significant variations across geographies, with countries like India, Nigeria, and Malaysia showing strong growth in fixed subscriptions.
The report stresses the need for the telecoms industry to rethink its strategies, as it faces high operational costs and pressure from external economic forces. The industry is poised to benefit from emerging technologies such as AI and digital connectivity, which could open up new avenues for growth. However, the report warns that telecoms companies must adapt and collaborate with investors and regulators to optimize market conditions and scale their operations.
One of the promising areas for future growth is the adoption of 5G services, which is expected to quadruple from 1.79 billion subscriptions in 2023 to 7.51 billion by 2028. The widespread use of 5G is anticipated to make it the dominant mobile standard by 2026, with Fixed-Wireless Access (FWA) emerging as the fastest-growing broadband technology. The report also noted that investments will shift toward fixed connectivity, particularly fibre rollouts, as mobile capex decreases, preparing the sector for future innovations such as 6G and expanded Internet-of-Things (IoT) applications.
SOURCE: THIS DAY