Global telecom markets to hit $3 trillion by 2010

05 Mar 2007

In its recently released global telecom spending survey, the Telecom Industry Association (TIA) paints a strongly bullish portrait of where the industry is heading for the remainder of the decade.
The report finds that demand for broadband and high-speed services fueled worldwide revenue growth of 12.1% in the telecom industry last year, which reached $2.1 trillion in sales. The worldwide market is on track to hit $3 trillion in sales by 2010, the report adds.

The industry surpassed $1 trillion in sales in 2000. It's expected to surpass $2.3 trillion this year and $2.5 trillion in 2008.

'An expanding broadband market, continued growth in wireless services fueled by both growing wireless subscribership and increased ARPU from entertainment and other non-voice wireless applications, increased spending on public network equipment and higher spending on services in support of enterprise and public network equipment were the principal drivers of [international] growth,' the TIA report finds.

In 2007, the TIA expects transport service revenue to reach almost $1.2 trillion, a rise from $1.1 trillion last year and a CAGR of 7.6% through 2010, when this segment reaches almost $1.5 trillion in sales. Internet access revenue will grow to $138 billion from $117 billion last year. Equipment and software sales will rise from $315.8 billion in 2006 to $347.9 billion in 2007. Support services will rise from $575.6 billion in 2006 to $666.1 billion this year.

The TIA's 2007 Telecommunications Market Review Forecast predicts that global sales growth will outpace that of the US throughout the remainder of the decade. The US telecom industry totaled $923.5 billion last year, a 9.3% increase from 2005. The growing popularity of wireless devices and services, as well as the growing use of broadband, Web conferencing and support services will grow the US market at a 7.6% compound annual rate to $1.2 trillion in 2010.

'Consumers are thirsty for broadband, and this report shows carriers are rushing to meet the demand,' says Grant Seiffert, TIA president. 'Technologies like VoIP and broadband video, as well as new mobile data services, are sparking new growth in the telecommunications industry. As a result, carriers are offering more competitive all-in-one bundled packages, and consumers are seeing lower prices and more services.'

The TIA report finds the global wireless broadband market growing 12.2% annually between this year and 2010, while landline transport will increase just 2% during that same period. Broadband Internet access will grow at a sizzling 17.6% annual rate, while dial-up Internet service will drop at a 0.4% annual rate by 2010. The worldwide equipment and software market will grow at an 8.4% annual rate through 2010, with public network spending outpacing enterprise spending. There will be even stronger annual growth in support services, with a 13.2% compound annual increase through the end of the decade.

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