Thursday, January 21, 2010
How Will Global Telecom Revenue Sources Change Over the Next Two Years?
Fixed network services other than broadband continue to decline.
Wireless revenues continue to grow, as does broadband access revenue.
Dial-up access revenue continues to decline.
Keep in mind that these are global, aggregate numbers, buoyed by huge broadband and especially wireless growth in developing regions. The patterns can be quite distinct in specific national markets.
In the U.S. market, it is conceivable that video and content revenues could be a somewhat significant factor over a decade-long time frame. Wireless growth will be highly susceptible to broadband and data services growth, balanced by a certain amount of "harvesting" of mobile voice revenue, which will decline, relative to broadband, over the decade.
It is worth noting that voice revenue trends have been through two fundamental cycles, with a third on the way. At one time, international long distance was the highest-margin product, followed by domestic long distance. That changed fundamentally between 1997 and 2007. Over that 10-year period, long distance, which represented nearly half of all revenue, was displaced by mobile voice services.
Since about 2000, fixed voice lines and revenue have been steadily declining, at least in the telecom service provider segment, with the cable segment able to grow the role of voice in overall revenue.
In the third change, mobile voice will follow a trend similar to that of long distance.
In each of the shifts already occurring, several things happened. Prices and profit margins steadily were compressed. And new competitors picked up significant share of the remaining business. In each of the three periods, the product has changed.
Between about 1997 and 2007, "long distance" became loosely coupled with local calling and local access. Long distance increasingly could be consumed "over the top," using prepaid calling cards or separate providers for "long distance" on a local line, for example.
Between 2000 and 2009, it became possible to use mobile phones to similarly displace both local and long distance calling, as well as to substitute mobility for fixed voice, while both over-the-top and IP-based calling options became available.
Over the next 10 years, both voice itself and long distance calling in the mobile and fixed realms likewise will be increasingly disaggregated and amenable to "over the top" consumption.
At the same time, the number of settings where voice is used likewise will disaggregate. Voice will be used as an embedded feature of many types of applications and experiences, using many types of terminals and featuring multiple revenue models.
Tuesday, August 13, 2013
How Much Will Global Telecom Revenue Grow in 2013?
2012
Spending
|
2012
Growth (%)
|
2013
Spending
|
2013
Growth (%)
|
2014
Spending
|
2014
Growth (%)
| |
Devices
|
676
|
10.9
|
695
|
2.8
|
740
|
6.5
|
Data Center Systems
|
140
|
1.8
|
143
|
2.1
|
149
|
4.1
|
Enterprise Software
|
285
|
4.7
|
304
|
6.4
|
324
|
6.6
|
IT Services
|
906
|
2.0
|
926
|
2.2
|
968
|
4.6
|
Telecom Services
|
1,641
|
-0.7
|
1,655
|
0.9
|
1,694
|
2.3
|
Overall IT
|
3,648
|
2.5
|
3,723
|
2.0
|
3,875
|
4.1
|
In North America, mobile revenues will grow by 35 percent and wireline broadband revenues will grow by 19 percent over current levels.
Friday, April 17, 2020
Flat Global Telecom "As Far as the Eye Can See"
The people who write press releases quite often are not subject matter experts. If they were, wildly incorrect headlines such as “Worldwide Spending on Telecommunications Services Is Forecast to Reach $1.6 Billion in 2020, According to IDC” would not appear in press releases. Global telecom revenue is closer to $2 trillion per year, almost every year. Ignoring the typo, the larger point is how flat revenue is going to be, globally.
Somebody was not watching closely enough. Earlier IDC press releases had called for $1,647 Billion in 2020. That’s $1.645 trillion.
IDC’s 2018 forecast called for revenue of, you guessed it, about $1.62 trillion.
Global Regional Services 2018 Revenue and Year-on-Year Growth | ||
Global Region | 2018 Revenue ($B) | CAGR 2018-2023 (%) |
Americas | 616 | 0.0 |
Asia/Pacific | 512 | 0.8 |
EMEA | 487 | 0.9 |
Grand Total | 1,615 | 0.5 |
The wider point, though, is that global telecom revenue--despite faster growth in some regions--has become a slow-growth business once again, as was the case in the monopoly era prior to about 1985.
Monday, August 20, 2012
Hosted IP PBX Services Will Grow 300% to 2016
Separately, Infonetics Research predicts the number of seats for hosted business VoIP and unified communications services is on track to more than double between 2012 and 2016. Note that forecast includes both hosted IP telephony and UC.
Among U.S. enterprises, defined as firms with 500 or more employees, spending on hosted IPT will grow at an average rate of 27 percent, which is almost two times faster than the average increase among U.S. SMBs (firms with fewer than 500 employees), InfoTrack says.
The global market for hosted PBX (hosted IP telephony) services averaged between four percent and seven percent in the largest SMB markets, Parallels noted, as recently as late 2011.
In the United States, it has been estimated that around 500,000 SMBs currently use a hosted PBX service, representing an $800 million market. In a U.S. telecom service business of about $336 billion in annual revenue, hosted IP telephony represents about two-tenths of one percent of total industry revenue.
But over the next five years, the growth of SMB spending on UC apps will be more than twice the rate of U.S. enterprises, which represents the mirror image of what we project happening in the hosted IPT sector," said Ken Dolsky, Senior Program Director for InfoTrack.
As always, one has to keep the size of the installed base in mind when pondering such forecasts. Other researchers, including Parallels, have estimated that small and medium business hosted IP telephony penetration is still relatively small.
The global market for hosted PBX (hosted IP telephony) services averaged between four percent and seven percent in the largest SMB markets, Parallels noted, as recently as late 2011.
Infonetics Research separately has forecast that the global SMB VoIP services market would grow to $76.1 billion in 2015 with total subscribers of 262 million. Keep in mind that the total global telecom services business accounts for about $2 trillion in annual revenue in 2012.
So hosted IP telephony would represent about four percent of global revenues.
In the United States, it has been estimated that around 500,000 SMBs currently use a hosted PBX service, representing an $800 million market. In a U.S. telecom service business of about $336 billion in annual revenue, hosted IP telephony represents about two-tenths of one percent of total industry revenue.
However, Parallels estimates that the majority of the current in-house PBX systems will migrate to hosted mechanisms over time, representing $3.9 billion potential market for hosted PBX.
US Hosted PBX Market – Source: Parallels SMB Cloud Insights Report, 2011
Wednesday, July 5, 2017
How Telecom Industry Will be Like the Airline Industry
Thursday, January 16, 2014
2014 Telecom Revenue Growth Picture is Mixed
The main point is that competition now has lead larger telecom providers to diverge, in terms of strategy, revenue models and actual revenue growth.
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