HAMPTON, N.H. (March 30, 2016) — According to Technology Business Research, Inc.’s (TBR) 4Q15 Telecom Infrastructure Services Benchmark, the telecom infrastructure services (TIS) market declined 1.5% year-to-year in 4Q15, largely due to 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 continued to buoy the global TIS market in 4Q15,” said TBR Telecom Senior Analyst Chris Antlitz. “A big issue many vendors will need to grapple with is how to continue growing revenue once operator capex spend in China goes post-peak. We expect that inflection point to occur in mid-2016. Once that happens, growth will become more challenging for the TIS market to achieve because network deployment volumes are coming down on an aggregate level and will be only partly offset by growth in professional services for transformation.”
Ericsson continued to dominate the TIS market by revenue despite currency headwinds, but Huawei is on pace to take the leadership position in 2016 as it rides the China spend cycle and grows its IT business. The combination of Nokia and Alcatel-Lucent will create a TIS market dominated by three super-companies starting in 1Q16, which could prompt further acquisitions and alliances as vendors try to stay competitive.
Forward-thinking vendors are getting ahead of this market shift from product-centric services to outcome-based services to capitalize on new growth areas, such as Internet of Things enablement and network transformation. Recent partnerships and acquisitions such as Ericsson-Cisco and Accenture-S3 TV Technology, respectively, will open new doors for vendors to support operators’ evolution into digital service providers. Leading with professional services is a key component of this strategy.
TBR’s Telecom Infrastructure Services Benchmark provides quarterly analysis of the deployment, maintenance, professional services and managed services markets for network and IT 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, Hewlett Packard Enterprise, 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.
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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, and telecom 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 address client-specific issues further or information needs on an inquiry or proprietary consulting basis.
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