The worldwide telecommunications market is on pace to reach US$2 trillion in 2008, a 7.6% increase from 2007 revenue of US$1.8 trillion, according to Gartner, Inc. The industry does face challenges as growth in the fixed voice sector and in the most developed countries has slowed or even begun to shrink.
"Revenue from telecom services has traditionally dominated the market, accounting for four out of every five dollars earned in the sector," said Will Hahn, principal research analyst at Gartner. "We forecast that this historic proportion will now shrink, an indication that legacy revenue is no longer sufficient for carriers to justify their investments and that the growing equipment sector is being deployed to support new and converged services, as well."
Revenue in the telecom service segment is expected to reach US$1.6 trillion in 2008 and account for 81% of overall telecom revenue. In 2007, total telecom service revenue was US$1.49 trillion, four times higher than total telecom equipment revenue at US$353bn. Gartner forecasts that by 2012, the service segment will have a CAGR of 4.4%, compared with 8.7% for the equipment segment. As a result, the relative proportions of the two segments will finally begin to move downward, closer to 3-to-1.
Gartner predicts that by 2012, the ratio of mobile to fixed connections will exceed 4-to-1. "We now forecast that revenue in the mobile sector will top US$1 trillion by 2010," said Hahn. "Our breakdown of services clearly shows that fixed voice is in decline, but mobile voice, though currently growing, will also stagnate as a proportion of the market by 2012. The baton has clearly been passed to data services in the legacy sector."
"Revenue from telecom services has traditionally dominated the market, accounting for four out of every five dollars earned in the sector," said Will Hahn, principal research analyst at Gartner. "We forecast that this historic proportion will now shrink, an indication that legacy revenue is no longer sufficient for carriers to justify their investments and that the growing equipment sector is being deployed to support new and converged services, as well."
Revenue in the telecom service segment is expected to reach US$1.6 trillion in 2008 and account for 81% of overall telecom revenue. In 2007, total telecom service revenue was US$1.49 trillion, four times higher than total telecom equipment revenue at US$353bn. Gartner forecasts that by 2012, the service segment will have a CAGR of 4.4%, compared with 8.7% for the equipment segment. As a result, the relative proportions of the two segments will finally begin to move downward, closer to 3-to-1.
Gartner predicts that by 2012, the ratio of mobile to fixed connections will exceed 4-to-1. "We now forecast that revenue in the mobile sector will top US$1 trillion by 2010," said Hahn. "Our breakdown of services clearly shows that fixed voice is in decline, but mobile voice, though currently growing, will also stagnate as a proportion of the market by 2012. The baton has clearly been passed to data services in the legacy sector."
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