The global telecommunications industry is projected to generate $1.3 trillion in revenue by 2028, according to PwC’s Global Telecom Outlook 2024-2028 report. However, the sector faces sluggish growth and pricing pressures, with revenue growth expected to slow to a compound annual growth rate (CAGR) of 2.9% through 2028—below the projected inflation rate.
In 2023, total service revenue across fixed and mobile networks grew by 4.3%, reaching $1.14 trillion. Despite this, the industry’s growth is set to decelerate, driven by challenges such as the commoditization of core services and the need for continuous infrastructure investment.
Nigeria: A Standout Performer
Nigeria’s telecom sector has emerged as a bright spot, with mobile service revenue hitting $7.6 billion in 2024. The country is expected to maintain an 8% CAGR between 2023 and 2028, making it one of the fastest-growing telecom markets globally.
This growth is fueled by a surge in mobile subscriptions rather than higher average revenue per user (ARPU). Fixed-line ARPU is projected to decline at a CAGR of -1.4%, while subscriber numbers are expected to grow at a CAGR of 9.8%.
Challenges and Opportunities
The report highlights a key challenge: the commoditization of core telecom products and services, which limits pricing power despite rising infrastructure costs.
“Core services are becoming commodities, making it difficult to raise prices while maintaining heavy infrastructure investments,” the report noted.
Despite these hurdles, the industry holds significant growth potential, with PwC projecting an additional $200 billion in incremental revenue by 2028. However, the slow growth rate has intensified pressure on companies to innovate and maximize value from existing revenue streams.
Regional Growth Disparities
Growth varies significantly across regions and services:
- Fixed broadband and mobile subscriptions are expected to grow steadily, with CAGRs of 3.8% and 4.3%, respectively, from 2023 to 2028.
- Fixed voice subscriptions, however, are projected to decline at a CAGR of -1.8% over the same period.
- Emerging markets like India, Nigeria, Egypt, and Kenya are driving growth, while mature markets such as Japan and Switzerland face stagnation or decline.
In fixed telecoms, most countries, including the US and China, fall within the 0 to 6% CAGR range. However, outliers like India, Nigeria, Egypt, and Kenya are experiencing significantly higher growth rates.
Mobile revenue growth also varies widely, with Colombia leading at a 10.5% CAGR, followed by India and Argentina. In contrast, mature markets like Japan and Switzerland are seeing declines.
5G Subscriptions to Quadruple by 2028
The report projects a significant surge in global 5G subscriptions, rising from 1.79 billion in 2023 to 7.51 billion by 2028. During this period, 5G’s share of total mobile subscriptions will more than triple, from 18.8% in 2023 to 64.1% in 2028.
“5G is expected to become the dominant mobile standard by 2026,” the report stated. “Fixed-Wireless Access (FWA) will be the fastest-growing broadband technology, with a CAGR of 18.3% through 2028.”
Capital expenditure (Capex) is also shifting toward fixed connectivity, particularly fiber networks. In 2023, total telecom Capex fell by 2.3%, driven by a 5.7% decline in mobile investments. However, Capex is forecast to grow at a 2.4% CAGR from 2024, fueled by fixed broadband investments and later by preparations for 6G.
Cellular IoT Growth Driven by Automotive Sector
The automotive and mobility sector is identified as a major driver of cellular Internet-of-Things (IoT) services, fueled by the rising adoption of smart automobiles and connected technologies.