In its “State of Digital Communications 2024” report, which was published using research from Analysys Mason, ETNO claims that European telecom operators invested €56.3 billion in digital infrastructure (mostly access networks) in 2021.
Meanwhile, content and application (CAP) companies such as Google, Netflix and Meta only invested €1 billion in infrastructure such as large international/undersea routes, peering, transit and caching.
APs invested roughly €1 billion in infrastructure such as large international/undersea routes, peering, transit and caching. They also invested a further €16 billion in data centres that year.
“CAPs have so far invested almost nothing in European physical networks that are closer to end users than caches, and certainly nothing at all in European fixed access or the physical RAN,” the report said.
This concerns ETNO and its members, which include Orange, Telefonica, TIM and Deutsche Telekom, among others, as their return on this significant investment is lacking.
Data from the report shows that European operators have the lowest average revenue per user (ARPU) in mobile networks at €15.0, compared to €42.5 in the USA, €26.5 in South Korea, and €25.9 in Japan
In fixed networks, only South Korea had a lower ARPU at €13.1, compared to €22.8 in Europe, €58.6 in the USA and €24.4 in Japan.
The revenue per employee of ETNO members was €0.46 million in 2021, compared to €2.33 million for Netflix, €1.46 million for Alphabet and €2.33 million for Meta.
The ETNO report was released as the EU is due to release its own strategic paper on February 21st, a plan that aims to address the funding of telecom infrastructure.
The initiative is spearheaded by EU industry commissioner Thierry Breton, and legislation could follow later in the year after EU elections take place in June.
“Users are expecting new networks and Europe’s competitiveness relies on innovative connectivity,” said Lise Fuhr, ETNO’s director general.
“This is why we must take urgent policy action to help strengthen the European telecom sector. The status quo – both in terms of investment and of policy – will not deliver the levels of innovation that are so desperately needed to sustain growth.”
