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Total US wireline carrier services entering a period of decline
Posted on 10-Nov-2003 22:47 | Tags Filed under: News

Total US wireline carrier services entering a period of decline
InStatMDR reports that The US carrier market will face a rough couple of years, as total wireline service revenues continue to decline. The high-tech market research firm finds that the group with the greatest challenge remains the long distance providers as their core revenue source, voice and long-haul private lines, show the greatest revenue declines. They also have very little market share in the few growing consumer telecom services (broadband).

RBOCs, who until recently still enjoyed revenue growth, are entering a period of increased market competition. This competition will come in the form of wireless services, UNE-P, cable operators, and IP Telephony. For US carriers, as a whole, their continued financial health will rely heavily on cost management. In face of declining service revenues, US carriers will need to control both their capital and operational costs if they are to remain profitable. Carriers also need to develop strategies that will help them to continue to grow their data services, thereby offsetting losses in voice. Even with strong data growth, it remains to be seen if service revenue levels will ever return to those of 2001.

Other findings in their paper:

  • Digital Subscriber Lines (DSL) remains the primary method of broadband service for US carriers. SBC and Verizon account for over half of all DSL lines in use and, worldwide, Asia Pacific is the largest market for DSL service.
  • When looking at all residential broadband subscribers, 2003 will be a turning point year for broadband, as total household penetration surpasses 20%. Overall household broadband penetration will continue to grow, and be in nearly 44 million US households by 2007.
  • For US carriers, business data services are an area of growth. Business needs for these services continue to grow. The services include the old standard of private line and newer Internet access services as well.
  • The total long distance voice market will have double-digit decreases in 2003 and 2004. The local market, while overall not as competitive as long distance, will see revenue declines of 4-6% over the next several years.

    The report is called State of the US Carrier Market (#IN030839IA) and supplies wireline service revenue forecasts for ATM, frame relay, private line, consumer broadband, and both consumer and business voice.

  • More information:

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