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Annex--U.S. and EU Telecom statistics.

Prepared by IDATE

It is difficult to discuss the merits of regulatory frameworks without examining market dynamics and trends in industrial organisations. For this reason, we have selected a set of data that would reflect the characteristics of the sector on both sides of the Atlantic. As we can see from the figures presented, the European and U.S. sectors share many common features, including the falling number of analogue telephony subscribers and a drop in fixed telephony revenues, market growth driven primarily by mobiles (with a time lag that is now mainly in favour of U.S. operators), rapid growth in the number of broadband subscribers, fixed-mobile convergence strategies, etc. Even the special feature of the U.S. sector to-date, namely the existence of a long distance market created by decree in 1982, has disappeared with AT&T and MCI taken over by SBC and Verizon. Against this background, the question of growth and innovation is becoming crucial to operators right across the industry in both the USA and Europe.

However, major disparities remain between Europe and the USA. We would like to highlight at least two of these differences. The first is the dominant role played by cable in the USA in the broadband access market. This situation led the judicial authorities, and subsquently the FCC, to call into question the unbundling obligations that applied to RBOCs, creating a trend towards heavy investment by the latter in deploying optical access networks and even in offering IPTV (as well as innovative services that are yet to be clearly defined). The second difference lies in the higher level of concentration in the U.S. sector versus the European Union, the largest single market on this side of the Atlantic. In the mobile sector specifically, balkanisation is not to be found in the USA, but in Europe. It remains to be seen whether Europe, which has seen many deals signalling national consolidation in recent months, is going to see a new phase of consolidation that can produce pan-European players of a similar size to the U.S. giants SBC and Verizon.

Telecom service markets by region
(2005 revenues in billion USD)
2005 worldwide market = 1 178 billion USD

USA 24%
W. Europe 28%
Asia-Pacific 28%
Row 20%

Source: IDATE

Note: Table made from pie chart.

Contribution to growth
(2002-2005 in billion USD and CAGR)

USA +1.9%
W. Europe +4.7%
Asia-Pacific +5.6%
Row +14.6%

Source: IDATE

Note: Table made from bar graph.

Telecom service revenues broken down by segment
(2005 revenues in billion USD, CAGR 2002-2005 in the blocks)

 USA W. Europe

Fixed telephony -8.0% -3.2%
Mobile services +12.8% +8.1%
Internet & -5.6% +12.0%
 corporate services

Source: IDATE

Note: Table made from bar graph.

The world top 10 telecom operators
(2004 revenues, billion USD)

Deutsche Telekom -2.6%
Verizon +3.7%
Vodafone +5.2% MIC
France Telecom +1.7%
SBC +2.2%
Telecom Italia -0.1% AT&T
Telefonica +6.8%
BT +0.6%
AT&T -11.6%

Source: IDATE, from annual reports

Note: Table made from bar graph.
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Copyright 2005 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Dossier
Author:Gassot, Yves
Publication:Communications & Strategies
Date:Nov 1, 2005
Previous Article:A regulatory framework for new and emerging markets (*).
Next Article:Interview with Prof. Eli Noam.

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