Skip to main content

Telecom Service Provider Equipment Upside

The worldwide market for telecommunications infrastructure equipment will exceed $109.9 billion in 2011, increasing at a five-year compound annual growth rate (CAGR) of 4.2 percent.

Network equipment sales to service providers (SP) performed strongly during the first half of 2007 driven by revenue growth from optical transport, broadband access, and routing and switching equipment.

However, I believe that the untapped opportunty continues to be providing service delivery platform (SDP) value-added design services to the majority of SPs that need to evolve their legacy business models.

"Consolidation of major networks and overall network expansion enabling increased wireless backhaul and video distribution to multiple screens will continue to spur service provider investments on new infrastructure for the foreseeable future," said David Emberley, research manager for Telecommunications Equipment at IDC.

That said, perhaps designing compelling user experiences will become the forward-looking point of differentiation that clearly separates the SP market leaders from the rest of the competition that's focused purely on building NGN infrastructure.

Major findings of IDC's forecast include:

- Optical networking will reach $13.7 billion at the end of 2011, with the fastest growth expected in the metro WDM space.

- IP router and switch will continue to experience double digit growth rates year over year, fueled by demand to support new video infrastructure and distribution.

- The access market will reach $8.5 billion by 2011, driven by demand for broadband, VoIP, and triple-play services.

- The wireless share of the telecom infrastructure market will decline to less than half by 2011 as service providers increased investment in wire-line infrastructure.

- Legacy equipments including DLCs, ATM switches and SONET/SDH will keep declining through 2011, as carriers continue to migrate their networks to an all-IP architecture.

Popular posts from this blog

The AI Application Integration Challenge

Artificial intelligence (AI) has rapidly become the defining force in business technology development, but integrating AI into applications remains a formidable challenge. According to a recent Gartner survey, 77 percent of engineering leaders identify AI integration in apps as a major hurdle for their organizations. As demand for AI-powered solutions accelerates across every industry, understanding the tools, the barriers, and the opportunities is essential for business and technology leaders seeking to evolve. The Gartner survey highlights a key trend: while AI’s potential is widely recognized, the path to useful integration is anything but straightforward. IT leaders cite complexities in embedding AI models into existing software, managing data pipelines, ensuring security, and maintaining compliance as persistent obstacles. These challenges are compounded by a shortage of skilled AI engineers and the rapid evolution of AI technologies, which can outpace organizational readiness and...