The Impact of Capital and Operating Expenditure on Performance and Quality of Mobile Services Delivered to Customers. DEA and PCA Approach.

Abstract

The purpose of this study was to give an overview of typical costs incurred in network planning and operation in the area of telecommunications business, and how these cost incurred impacts on quality of mobile service provided to subscribers. Firstly, estimates for Capex and Opex are studied, together with key performance indicators (KPI). This is done to assess how expenditures incurred by mobile operator’s impact quality of mobile service delivered to subscribers and revenue. The results indicate that efficiency scores based on DEA and ANN estimates show a repertoire of telco efficiencies, with regards to Capex and Opex inputs impact on defined outputs. Three telcos were efficient in the workability of their capital expenditure in impacting quality of service whereas only two telcos were efficient with their operating expenditure impact on service quality. Lastly, PCA is used to classify the telcos into two different operational strategic groups, based on their relative efficiency scores. The result highlight the strategies of Telcos in Ghana; those who strive to attain service quality or service revenue and those who use a mixed approach.