HAMPTON, N.H. (Sept. 28, 2015) — According to Technology Business Research Inc.’s (TBR) 2Q15 Telecom Infrastructure Services Benchmark, the TIS market eked out 0.3% growth year-to-year in 2Q15 despite the impact of the strengthened U.S. dollar, which created unfavorable compares for foreign-based companies. This dynamic skewed results for many vendors and put the TIS market in decline across all geographies except APAC, where there was continued strong spend on network infrastructure deployments in China and demand for a range of services in India.
“Strong TIS spend in China and India offset lower spend in other regions and kept the TIS market on a growth trajectory,” said TBR Telecom Senior Analyst Chris Antlitz. “While China Mobile’s spend slows, China Unicom and China Telecom are ramping up spend, which continues to fuel the growth of Huawei, CCS and ZTE as well as other vendors such as Ericsson and Nokia Networks.”
Ericsson remained the dominant TIS supplier, but the company is not immune to the broader trends impacting the market. Its TIS revenue continued to decline due to the impact of the strong dollar and shift in operators’ North America investments from LTE coverage to densification. Huawei experienced strong growth and continues to close the gap with Ericsson in total TIS revenue, thanks to a revenue boost due to LTE and fixed deployments in China and continued expansion in Europe. Alcatel-Lucent and Nokia Networks continue to suffer revenue declines due to the downsizing of their managed services businesses and the impact of the strong dollar.
Though ongoing network rollouts and capacity enhancements continue to underpin the majority of spend volume in the TIS market, demand is increasing for nonproduct-attached services. Specifically, operators want more consulting and systems integration services to help them transition to a virtualized world as well as implement new business models and improve operational efficiencies. This demand is being driven predominantly by Tier 1 operators, some of which are taking the plunge with software-defined networking and network functions virtualization. Some vendors, particularly Huawei, Cisco, Ericsson, Nokia Networks and Alcatel-Lucent, are increasing their exposure to nonproduct-attached services to get ahead of this market trend.
TBR’s Telecom Infrastructure Services Benchmark provides quarterly analysis of the deployment, maintenance, professional services and managed services markets for network equipment suppliers. Suppliers covered include Accenture, Alcatel-Lucent, Amdocs, American Tower, Atos, Bechtel, Bouygues Construction, Capgemini, CGI, China Communications Services, Ciena, Cisco, CommScope, Convergys, Crown Castle, CSG International, CTDI, Ericsson, Fujitsu, General Dynamics, HP, Huawei, IBM, Indus Towers, Infinera, Infosys, iQor, Juniper, NEC, Nokia Networks, Oracle, Orascom Construction Industries, Samsung, SAP, SBA Communications, Tata Consultancy Services, Tech Mahindra, TEOCO, Wipro and ZTE.
For additional information about this research or to arrange a one-on-one briefing with Chris Antlitz, please contact Justin Surgent at +1 603.758.1871 or justin.surgent@tbri.com. Reports are available to qualified members of the press. For information on purchasing reports, call +1 603.758.1813 or email sales@tbri.com.
ABOUT TBR
Technology Business Research Inc. is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, professional services, telecom and enterprise network vendors, and operators. Serving a global clientele, TBR provides timely and actionable market research and business intelligence in a format that is uniquely tailored to clients’ needs. Our analysts are available to further address client-specific issues or information needs on an inquiry or proprietary consulting basis.
TBR has been empowering corporate decision makers since 1996. For more information please visit www.tbri.com.
