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$8 BILLION 800 MARKET TO GROW FIVE PERCENT AS TOLL-FREE NUMBERS GO 'PORTABLE'

 MOUNTAIN VIEW, Calif., Sept. 27 /PRNewswire/ -- AT&T will see its toll-free "800" market share erode from almost 74 percent in 1992 to 60 percent by 1996, as end-users gain new power to keep their toll-free numbers yet move to the carrier of their choice with 800-number portability, projects a new report just released by Frost & Sullivan Market Intelligence.
 The total toll-free "800" market will grow from $7.9 billion in 1992 to $10.8 billion by 1999 at a nearly 5 percent compound annual rate, paced by rapid international toll-free growth and non-AT&T carriers, forecasts the report, "800 Service Markets: Portability Unleashes Competition."
 Overall revenue growth will slow substantially this year due to heavy competitive price pressures surrounding portability that will bring dramatic promotional offers for smaller users and serious individual price-cutting for big ones.
 While the "classic" WATS-line 800 service that defined toll-free service for nearly 20 years continues declining toward oblivion, both switched and dedicated services will grow. Spurred by a continued influx of new small users, switched services that provide 800 service on regular phone lines will account for half of market revenues for the first time in 1994, although lower-priced high-volume dedicated services for big users make up a larger share of call traffic.
 Although international toll-free remains a relatively small part of the market, generating $468 million in 1992, it will see dramatic growth in the 1990s with a 16 percent CAGR and nearly triple in size by 1999, when it will account for well more than 10 percent of U.S. carriers' toll-free revenues. By the end of the decade, global toll-free numbers will be available.
 Local exchange carriers (LECs), who have lost half their toll-free revenues over the past four years, will finally achieve positive growth again in 1994, with increased development of their standalone switched services for small local users and the proliferation of cooperative agreements with interexchange carriers (IXCs) that allow LECs to act as "one-stop shops" for national 800 service despite the legal strictures that keep them from offering service themselves outside their "LATA" regions.
 Customer service and sales and marketing applications will be the major drivers of growth domestically as well as internationally. Customer service is now growing even faster than sales domestically, and will become the single largest 800 application segment in 1993.
 Frost & Sullivan Market Intelligence's carrier industry expert Steve Koppman, who has authored numerous telecom services studies of such markets as U.S. long-distance, worldwide telecom services, private lines, pay-per-call (900/976), operator services, reselling, WATS-like services and local exchange strategies, is the author of this newly published report.
 Frost & Sullivan Market Intelligence is an international high-technology research firm specializing in telecommunications. All Frost & Sullivan Market Intelligence reports are based on extensive interviews with marketing and technical experts from selected companies in each market segment. Frost & Sullivan Market Intelligence is the leading publisher worldwide of high-technology market research reports.
 Total Toll-Free 800 Service Market:
 Revenue Forecasts (U.S.),
 1989-1999
 Revenue
 Revenues Growth Rate
 Year ($ million) (percent)
 1989 6,640.7 --
 1990 6,899.7 3.9
 1991 7,317.4 6.1
 1992 7,889.3 7.8
 1993 8,034.2 1.8
 1994 8,540.9 6.3
 1995 9,057.6 6.0
 1996 9,536.6 5.3
 1997 9,991.4 4.8
 1998 10,411.3 4.2
 1999 10,809.8 3.8
 Compound Annual Growth Rate (1992-1999): 4.6 percent
 NOTE: All figures are rounded.
 -0- 9/27/93
 /CONTACT: Amy Arnell of Frost & Sullivan, 415-961-9000/


CO: Frost & Sullivan Market Intelligence ST: California IN: TLS SU:

PK-TM -- SJ007 -- 6008 09/27/93 14:44 EDT
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Date:Sep 27, 1993
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