With telecommunications companies expected to spend two trillion US dollars (US$) of capital expenditure (CAPEX) between 2014 and 20191, a new survey from KPMG International explores and addresses how those responsible for capital management can make the most of this significant investment.Peter Mercieca, KPMG’s Global Sector Chair, Media and Telecommunications comments:
“The global telecommunications industry is capital intensive and fiercely competitive. Capital management in this environment requires the right mix of investments to maximize long-term shareholder value by ensuring that expenditures are aligned to strategy and market demands. It is also about continually monitoring a portfolio of investments to make certain that it is managed efficiently to enable the business to compete and grow profitably.”
The KPMG survey on capital management practices is based on responses from 20 of the world’s leading telecommunications companies based in Europe, the Middle East and Africa, Asia Pacific and the Americas - the largest of which have annual revenues over US$100 billion.
According to the KPMG survey, fast-paced technology change, insatiable demand for data, and increased rivalry are driving considerable investment in next generation technologies, new markets, innovative products and services, strategic alliances and fresh business models.
The KPMG survey identified leading practices and emerging trends across all aspects of the capital management process, highlighting differences in approach, and areas for improvement. Figure 1 below charts the relative capital management performance of survey respondents against the capital management lifecycle as defined by KPMG.
The full KPMG International survey ‘Building valuable connections: Capital management in the global telecommunications sector’ can be downloaded at www.kpmg.com/buildingvaluableconnections.
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1Communications Service Provider Revenue & Capex Forecast: 2014 - 19, Ovum, 2014.
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