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Video and web access to keep comms healthy

To the tune of £4 trillion, TIA review says

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Comment The Telecommunications Industry Association (TIA) report makes fascinating reading every year, mostly because it points to the sheer scale of the industry, but also because it highlights just how big the trends we have been following have already become and how big they are likely to become in a few more years, projecting out to 2010.

This year it's a 325 page report, and worth every penny if you are in and around the various $650 to $5,000 price tags that it carries in its guises from a straight paper copy up to a corporate pdf license.

The first thing out of the box that it tells you is that the global telecommunications industry is growing at 11.2 per cent and is today $3 trillion and by 2010 will make it to over $4 trillion. Effectively it's the biggest high growth technology market in the world – and then some.

Europe has the largest telecommunications market, measuring at $1 trillion, with the US second at $923bn and Asia Pacific third at $715bn.

But the report also immediately focuses the attention on two key factors, broadband and entertainment. It is abundantly clear that every thing that is growing at breakneck speed are related to broadband and entertainment, while most things like fixed lines are either shrinking in some territories or at least growing gently.

"Consumers are thirsty for broadband, and this report shows carriers are rushing to meet the demand," said Grant Seiffert, TIA president. "Technologies like voice over Internet protocol (VoIP) and broadband video, as well as new mobile data services, are sparking new growth in the telecommunications industry. As a result, carriers are offering more competitive all-in-one bundled packages, and consumers are seeing lower prices and more services."

That's hardly new, but when you collect together all of the evidence of every sub-market in telecommunications and find that collectively they are yelling "get me video and fast internet access" – everywhere, then it's no longer a debate.

The report forecasts growth for new broadband technologies like fiber, satellite, wireless and powerline, and says that combined these will account for around 11 per cent of broadband all subscribers by 2010 from around four per cent now. Today, the remaining 96 per cent is shared between DSL and cable, and dialup finally got overtaken by broadband. But by 2010 87 per cent of all internet access will be broadband.

But again, it projects only 700,000 Broadband over Powerline during that time, which is a reasonable number, though it's not if a company like DirecTV decides to back this as its main route into the US home, which it is threatening to do. A company like that might sell up to 1 million BPL customers each year and change the forecast radically.

The rReview is right in thinking that video is behind the resurgence in laying any kind of cable, whether or not it is fiber to the home, or to the loop, but for the first time the report gives a fair mention to IPTV services over telecom loops which are comparable to cable TV but without really forecasting them. Around 12 million miles of fiber was deployed during 2006, with 10 million miles of that being deployed by the phone companies, so just two decisions, at AT&T and at Verizon, have changed the global economics of fiber laying.

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