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Capital expenditure

Swisscom remains committed to maintaining the high quality and availability of its network infrastructures. In Switzerland this involves making targeted investments in ultrafast broadband network expansion, migrating to an All-IP-based infrastructure, and ensuring a mobile network with latest mobile network standards.

See report pages 48—51

In Italy, Fastweb operates a network comprising a proprietary fibre-optic network and a copper-­based broadband access infrastructure. Fastweb is also systematically expanding this network infrastructure.

In CHF million, except where indicated   2016   2015   Change
Fixed access & infrastructure   500   509   –1.8%
Expansion of the fibre-optic network   476   435   9.4%
Mobile access   231   210   10.0%
Customer driven   189   251   –24.7%
Projects and others 1   347   394   –11.9%
Swisscom Switzerland   1,743   1,799   –3.1%
Fastweb   633   581   9.0%
Other Operating Segments   61   48   27.1%
Group Headquarters and elimination   (21)   (19)   10.5%
Total capital expenditure   2,416   2,409 2   0.3%
Thereof Switzerland   1,774   1,822   –2.6%
Thereof other countries   642   587   9.4%
Total capital expenditure as % of net revenue   20.8   20.6  
1 Including All IP migration.
2 Excluding capital expenditure of CHF 18 million in real estate projects, for which sales contracts were concluded and the purchasers made payments in the same amount.

Capital expenditure incurred by Swisscom increased year-on-year by CHF 7 million or 0.3% to CHF 2,416 million, corresponding to 20.8% of net revenue (prior year: 20.6%). Swisscom Switzerland accounted for 72% of 2016 capital expenditure, while Fastweb accounted for 26% and Other Operating Segments for 2%.

Capital expenditure incurred by Swisscom Switzerland declined year-on-year by CHF 56 million or 3.1% to CHF 1,743 million, corresponding to 18.5% of net revenue (prior year: 18.8%). The increase in capital expenditure for the expansion of broadband networks with latest technologies was more than offset by a drop in customer-driven investment and investment in the development of service platforms. At the end of 2016, Swisscom had connected over 3.5 million households and businesses to ultrafast broadband (speeds in excess of 50 Mbps). Of these, over 2.5 million were equipped with latest technologies – from fibre to the home (FTTH) to the latest fibre-optic technologies such as fibre to the street (FTTS), fibre to the building (FTTB) and vectoring technology. By the end of 2016, Swisscom had extended state-of-the-art 4G/LTE coverage, which enables broadband access to the Internet, to 99% of the Swiss population.

Fastweb increased its capital expenditure year-on-year by CHF 52 million or 9.0% to CHF 633 million. In local currency the rise amounted to EUR 40 million or 7.4% to EUR 581 million. The main reason for this rise was an increase in capital expenditure for broadband networks. In July 2016, Fastweb and Telecom Italia announced plans to cooperate on the rollout of fibre to the home (FTTH). The aim is for about half of all homes and businesses in Italy (i.e. 13 million), to be connected to the ultrafast broadband network by 2020. The ratio of capital expenditure to revenue was 32.4% (2015: 31.2%), with around 30% of total capital expenditure being directly related to customer growth.