Wholesale Business: Perception and Reality Might Not Match

At the risk of appearing foolish, I have been writing a lot recently about the need to maintain some rigor in assessing the likely impact of the recession on communications service provider revenues, growth rates and profits. There is a natural tendency to panic and over-react when virtually everyone around you "feels so bad."

The emotion is real, and strains are real. But there is some amount of evidence that consumer and small business buyers, for example, have not been reducing their buying of services. So it might be noteworthy that, at the Pacific Telecommunications Council annual conference,  Stealth Communications CEO Shrihari Pandit says neither carrier nor enterprise customers, in aggregate, have reduced spending with Stealth in 2008. In fact, revenues have grown all year. 

That isn't to say every company, every customer segment or every industry segment can say the same. It is to point out that in times when emotion tends to cloud decision making, it is more important to pay close attention to the actual numbers, rather than relying on one's own emotions, or the emotions business partners might legitimately feel. 

Though it always is possible I am wrong, I would argue from history that, when the recession is over, communications service providers will have shown absolute revenue growth, though at lower rates than in 2007 or 2008, with lower average revenue per unit. There might be segments that do less well, but the industry will emerge with net growth.