{"id":1343,"date":"2006-07-29T08:04:00","date_gmt":"2006-07-29T08:04:00","guid":{"rendered":"https:\/\/mhgoldberg.com\/blog\/?p=1343"},"modified":"2017-01-25T22:34:52","modified_gmt":"2017-01-26T03:34:52","slug":"capital-intensity","status":"publish","type":"post","link":"https:\/\/mhgoldberg.com\/blog\/?p=1343","title":{"rendered":"Capital intensity"},"content":{"rendered":"<div style=\"font-size: 58px; float: left; margin: 0pt 4px 10pt 0pt; color: #cc0000; padding: 0pt;\">$<\/div>\n<div align=\"justify\">As I mentioned <a href=\"https:\/\/mhgoldberg.com\/blog\/?p=1344\">Thursday<\/a>, the CRTC released its annual <a href=\"http:\/\/www.crtc.gc.ca\/eng\/publications\/reports\/PolicyMonitoring\/2006\/tmr2006.htm\">monitoring report<\/a> on the state of competition in Canadian telecom. One of the interesting sets of numbers to look at in the CRTC&#8217;s monitoring report is capital spending.<\/p>\n<p>I like to look at capital intensity, defined as the amount of capital per dollar of revenue. It is interesting to see that the wireline industry is investing twice as much, per dollar of revenue, as the wireless industry.<\/p>\n<p>In 2002 and 2003, wireless revenues were in line with the industry at large: roughly a quarter of total wireless revenues and their capital spending was roughly a quarter of total industry investment. But in 2004 and 2005, the wireline business spent almost 20 cents out of each dollar of revenue in capital, while the wireless industry dropped to a low of 10 cents.<\/p>\n<p>There are some fundamentals at play in both sectors. It is interesting to see that the wireless sector is able to grow revenues with declining capital, while the wireline side must fight just to minimize revenue erosion and increase investment at the same time.<\/p><\/div>\n<p align=\"center\"><img decoding=\"async\" src=\"http:\/\/www.crtc.gc.ca\/eng\/publications\/reports\/PolicyMonitoring\/2006\/f416.gif\" border=\"1\" \/><\/p>\n<div align=\"justify\">As a historical artifact, look at the statistical outlier in 2001 &#8211; the aberration of new entrant capital spending driven by &#8216;Field of Dreams&#8217; business plans of the dot-com bubble.<\/div>\n","protected":false},"excerpt":{"rendered":"<p>$ As I mentioned Thursday, the CRTC released its annual monitoring report on the state of competition in Canadian telecom. One of the interesting sets of numbers to look at in the CRTC&#8217;s monitoring report is capital spending. I like to look at capital intensity, defined as the amount of capital per dollar of revenue. &hellip;<\/p>\n<p class=\"read-more\"> <a class=\"\" href=\"https:\/\/mhgoldberg.com\/blog\/?p=1343\"> <span class=\"screen-reader-text\">Capital intensity<\/span> Read More &raquo;<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","two_page_speed":[],"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1343","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Capital intensity &#8226; Telecom Trends<\/title>\n<meta name=\"description\" content=\"$ As I mentioned Thursday, the CRTC released its annual monitoring report on the state of competition in Canadian telecom. One of the interesting sets of &#8226; July 29, 2006\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/mhgoldberg.com\/blog\/?p=1343\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Capital intensity &#8226; Telecom Trends\" \/>\n<meta property=\"og:description\" content=\"$ As I mentioned Thursday, the CRTC released its annual monitoring report on the state of competition in Canadian telecom. One of the interesting sets of &#8226; July 29, 2006\" \/>\n<meta property=\"og:url\" content=\"https:\/\/mhgoldberg.com\/blog\/?p=1343\" \/>\n<meta property=\"og:site_name\" content=\"Telecom Trends\" \/>\n<meta property=\"article:published_time\" content=\"2006-07-29T08:04:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2017-01-26T03:34:52+00:00\" \/>\n<meta property=\"og:image\" content=\"http:\/\/www.crtc.gc.ca\/eng\/publications\/reports\/PolicyMonitoring\/2006\/f416.gif\" \/>\n<meta name=\"author\" content=\"Mark Goldberg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@mark_goldberg\" \/>\n<meta name=\"twitter:site\" content=\"@mark_goldberg\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Mark Goldberg\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343\"},\"author\":{\"name\":\"Mark Goldberg\",\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/#\\\/schema\\\/person\\\/3fb9ac7e53dc710f23be648a3b1ab4d7\"},\"headline\":\"Capital intensity\",\"datePublished\":\"2006-07-29T08:04:00+00:00\",\"dateModified\":\"2017-01-26T03:34:52+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343\"},\"wordCount\":210,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343#primaryimage\"},\"thumbnailUrl\":\"http:\\\/\\\/www.crtc.gc.ca\\\/eng\\\/publications\\\/reports\\\/PolicyMonitoring\\\/2006\\\/f416.gif\",\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343\",\"url\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343\",\"name\":\"Capital intensity &#8226; Telecom Trends\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/mhgoldberg.com\\\/blog\\\/?p=1343#primaryimage\"},\"thumbnailUrl\":\"http:\\\/\\\/www.crtc.gc.ca\\\/eng\\\/publications\\\/reports\\\/PolicyMonitoring\\\/2006\\\/f416.gif\",\"datePublished\":\"2006-07-29T08:04:00+00:00\",\"dateModified\":\"2017-01-26T03:34:52+00:00\",\"description\":\"$ As I mentioned Thursday, the CRTC released its annual monitoring report on the state of competition in Canadian telecom. 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