Hello Ray, can you tweak your model until you get the desired results?
Nokia:3G license ROI for operators in four years
By Simon Marshall, Total Telecom, in Cannes
21 February 2001
Nokia fully expects mobile operators to recoup the phenomenal sums they paid for 3G licences in as little as four years, and in markets where there is dense radio coverage, such as Hong Kong, much sooner.
Nokia's 3G business consultancy – a business division which calculates expected return on investment (ROI) for 3G operators – told Total Telecom at the 3GSM Congress Wednesday that operators wouldn't have to wait long to get their money back.
“The pay-back period for 3G licences is between four and seven years for incumbents,” said the global head of the 3G business consultancy Tomi Ahonen, “although in Hong Kong or the Netherlands, the pay-back time will be shorter.”
Conversely, geographical markets which have gossamer-thin radio coverage, such as Canada, will have to wait longer before having the money to pay back loans.
But ROI is not just dependant on rolling-out 3G services, as operators look to squeeze every bit of capacity they still can from GSM networks.
“GSM networks will not be able to handle [the increase in] traffic from peer-to-peer or Multimedia Messaging (MMS) services, and voice alone is already overloading GSM networks in London, for example,” said Ahonen. “but in every case where we've modelled UMTS neworks for operators, the incumbents have said they expect to carry on using their GSM networks in parallel for up to ten years.”
“Everyone hopes to become a 3G operator in the future, but the real business today is that they all have to make money,” he added.
Nokia's 3G business consulting group assess ROI based on an operator's existing known revenues, projected future revenues, known fixed investments such as licences fees and the assumed extra cost as a result of the loading of the network from 3G services.
totaltele.com |
