Wednesday, October 12, 2022

Why Mobile Infra Capex Keeps Growing

There is a pretty simple reason why the cost of mobile infrastructure keeps climbing: mobile cell sizes keep shrinking. And they keep shrinking for obvious physical reasons: smaller cell sizes mean more intensive use of any particular spectrum asset, while new frequencies available for mobile operator use are disproportionately in the high frequencies that require use of small cells. 


Smaller cells require more intensive engineering and lots more optical fiber backhaul. If one uses the low band spectrum as the baseline, then midband signals reach only about 20 percent as far as low band signals do. 


source: Digital Infra 


Millimeter wave and higher frequencies have about two percent of the reach of low band signals. 


Keep in mind that every time a mobile operator reduces cell size by 50 percent, it quadruples the number of cells required to serve any given area. 


So moving to mid band frequencies increases by a factor of six to eight the number of required cell sites. That means six to eight times the number of radio sites and backhaul connections, all other things being equal. 


Moving to millimeter wave spectrum will require an almost-astronomical number of additional sites. 


The other issue is that use of smaller cells allows more intensive reuse of any existing spectrum asset. In an ear where internet consumption keeps growing at about 40 percent per year, capacity expansion is a must. New spectrum always helps, but most capacity expansion in the mobile industry historically has come from use of smaller cells.



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