Business Spending on Telecommunications Has Shifted to Wireless

U.S. businesses will spend $154 billion for telecommunications services in 2012, growing to $184 billion by the close of 2016, representing a compound annual growth rate (CAGR) of 4.8 percent over the forecast period,  according to Insight Research.


Significantly, business spending for cellular and other wireless services is creating all of the business revenue growth, the firm says.

While U.S. business spending for wireline services is essentially flat over the five year forecast horizon, wireless expenditures are expected to grow at a compounded rate of 9.4 percent from 2011 to 2016, Insight Research forecasts.

Four vertical industries, including wholesale trade; financial, insurance, and real estate services; professional business services; and communications, accounted for 68 percent of total business telecom expenditures in 2011.


Of course, one might also note that consumer spending is shifting to wireless as well.


Insight Research also predicts that global telecommunications services revenue will grow from $2.1 trillion in 2012 to $2.7 trillion in 2017 at a combined average growth rate of 5.3 percent.


Wireless subscriber growth, particularly in Asia and other emerging markets, will raise wireless revenues by 64 percent from current levels, while wireline revenues show only modest growth.


Nearly all of the growth in both sectors is expected to occur in broadband services, with wireless 3G and 4G broadband services projected to grow at a compounded rate of 24 percent over the forecast period and wireline broadband services projected to grow at a 13 percent compounded rate over the same forecast horizon, the company predicts.