Skip to main content

Outlook for U.S. Enterprise Data Services

Most traditional wireline data services spending by U.S. businesses has been consistently falling in 2009, according to the latest market study by In-Stat. However, there are a few exceptions to this trend.

Overall, In-Stat expects a nearly 2 percent decline in U.S. business spending on wireline data services -- which represents the first time this market has declined in the 10 plus years In-Stat has been tracking it.

Wireline data services include expenditures on wide area network (WAN) data transport services, as well as, dedicated Internet access (which includes cable and DSL), network-based IP VPN, private line, frame relay, ATM, and Ethernet services.

Note, the category does not include managed services, such as, hosted IP telephony, LAN infrastructure, security, and other managed service solutions, which are tracked separately by In-Stat.

"Ethernet Services and IP VPN services are among the lone bright spots in the market," says David Lemelin, In-Stat analyst.

Spending on ATM, Frame Relay and Private Line services is particularly weak, declining about nearly 10 percent from 2008. Among the vertical business markets, the professional services and healthcare segments are faring best, but even these are only flat year to year.

In-Stat's market study found the following:

- Spending on wireline data services by U.S. Enterprises (1000+ employees) is on track to decline from $23 billion in 2008 to $22.4 billion in 2009. Spending will stabilize in 2010 before returning to growth reaching $25 billion by 2012.

- Spending on IP VPN services by U.S. Small Businesses (5-99 employees) is projected to grow from about $100 million in 2008 to over $250 million in 2012.

- Among vertical segments of U.S. Enterprises, government represents the largest segment.

- Spending on Ethernet Services among healthcare firms will see some of the strongest growth, nearly tripling from 2008 to 2012.

Popular posts from this blog

The Billions Bet on Tentative AI Demand

Gartner's latest worldwide IT spending forecast exposes a trend every CIO has already felt in budget negotiations. Total spending will climb 14.2 percent in 2026, reaching $6.37 trillion. It seems that the IT infrastructure market is simply having a strong year. However, the more useful insight is how unevenly that growth is distributed. The Headline Number vs. The Real Story Data center systems and infrastructure as a service (IaaS) are absorbing capital at a pace several multiples faster than devices, communications services, and traditional IT services. This is not incremental growth spread across a healthy portfolio. It is a wholesale reallocation of enterprise technology budgets toward AI infrastructure, made on the expectation that demand for AI workloads will justify the outlay before that demand has been fully proven. Where the Money is Going Data center systems are forecast to grow 62.5 percent in 2026, that's up from 51.6 percent growth in 2025, reaching $822 billion....