Saturday, August 28, 2010

U.S. Telecom Industry Revenue Flat Through 2015

If you run a publicly-traded company in the telecommunications industry, this revenue forecast by Atlantic-ACM will cause heartburn. 

Between 2009 and 2015, revenue will be flat, in fact declining a bit. 

If you run a public company, you are judged on revenue growth. That inescapable vice suggests just one thing: massive financial trouble ahead for industry players or significant shifts of market share that allow some companies to keep growing at the expense of others. 

Most companies will run hard just to stay in place. But it seems unlikely most companies can do that on a long-term basis. Public companies must grow, or get punished. Public companies that don't grow will be acquired. More than anything else, industry lack of real growth is going to lead to relatively-massive consolidation. 

To be sure, most companies are trying to find other new revenue streams that do not simply take existing market share from other competitors, but actually add new incremental revenue. In all likelihood, those streams will be quite small for a while, though, and likely will not be significant enough to get the industry out of its "flat revenue" jam. 

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