Inflation and Energy Costs Drive Increased Spending by Telecom Operators Through 2026

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IDC forecasts global telecom and pay-TV spending to reach $1.6 trillion by 2026, with inflation and high energy prices pushing operators to raise tariffs, while satellite partnerships create new growth opportunities.

According to IDC's latest research on global telecommunications and pay-TV services, overall industry spending is projected to reach approximately $1.6 trillion by 2026, reflecting a 2.3% year-over-year increase primarily driven by inflationary pressures. The analysis highlights that ongoing high energy costs—exacerbated by geopolitical conflicts in the Middle East and Ukraine—are significantly impacting operator expenses. These elevated costs are likely to result in operators increasing their service tariffs to preserve profit margins, thereby contributing to sustained market growth through the end of 2026 and into 2027.

Regionally, the Americas are expected to register the highest growth in telecom spending, followed by Europe, the Middle East and Africa (EMEA), and the Asia-Pacific region. Within the market segments, mobile services will continue to dominate, fueled by rising data usage and increased machine-to-machine communication applications, which more than offset declines in voice and messaging revenues.

IDC also identifies emerging opportunities stemming from the adoption of satellite broadband, particularly leveraging low Earth orbit satellite constellations such as SpaceX Starlink and Amazon's Project Kuiper (Leo). While the overall impact on fixed data services remains limited due to the selective applicability of satellite offerings, the firm emphasizes the potential unlocked by direct-to-device (D2D) connectivity alliances between terrestrial operators and satellite providers.

Such partnerships enable telecom operators to extend network coverage beyond their traditional terrestrial footprints by integrating satellite capacity, thereby differentiating services and reaching underserved or remote areas. Kresimir Alic, IDC's Research Director for Worldwide Telecom Services, stressed that the future of connectivity lies in blending terrestrial and satellite technologies rather than treating them as competitors. Operators embracing satellite networks as extensions of their own infrastructure are better positioned to enhance customer loyalty, safeguard revenues, and connect the emerging billion users yet to be served.

This comprehensive forecast underscores how external economic factors and innovative collaborative models are reshaping spending dynamics and growth avenues within the global telecommunications industry.