What is OPEX and CAPEX in a Mobile Network Operator (MNO) ?
OPEX and CAPEX together form the majority of a mobile network operator's total expenses.
OPEX (Operating Expenses): These are the ongoing costs necessary to keep the business running day-to-day.
This includes :
Salaries and wages, Rent and utilities, Marketing and advertising, Maintenance and repairs, Licensing fees, IT costs, Customer support.
While CAPEX (Capital Expenditures): These are investments in long-term assets that are expected to generate revenue over multiple years.
This includes :
Network infrastructure (Core and access devices, towers, antennas, fiber optic cables), IT equipment (servers, routers, switches), Real estate (land, buildings), Research and development.
OPEX and CAPEX forms how much of mobile network operator expenses ?
The exact percentage of OPEX and CAPEX in a mobile network operator's expenses can vary significantly depending on several factors. Such as stage of network development and market cometition.
However, typically OPEX accounts for a significant portion of a mobile operator's total expenses, often ranging from 60% to 75%. While CAPEX typically accounts for the remaining 25% to 40% of total expenses.
A common range for MNO expense ratios is between 60% and 80% of total revenue. This means that for every dollar of revenue generated, the operator spends between 60 and 80 cents on expenses
It's important to note that these are general estimates, and the actual breakdown can vary widely among different operators and regions.
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