Wired Telecommunications Carriers in the US - Industry Market Research Report

Wired Telecommunications Carriers in the US - Industry Market Research Report

  • May 2021 •
  • 43 pages •
  • Report ID: 199012 •
  • Format: PDF
Call waiting: Industry profit will likely rise due to the prevalence of bundling packages

Abstract

Wired Telecommunications Carriers in the US

The Wired Telecommunications Carriers industry exhibits a moderate level of market share concentration, as the high upfront investment required to create a communications network, along with the complexity of managing this large, interconnected infrastructure, tends to keep smaller operators out of this industry. However, concentration is expected to decrease as carriers spin off parts of their wireline divisions in favor of higher-performing broadband internet or wireless offerings.

High barriers to entry keep smaller companies out

• This industry has high barriers to entry, as building telecommunications infrastructure requires a large expenditure of capital. In addition, telecommunication infrastructure is difficult and complex to manage once in place. As a result, it is difficult for smaller operators to gain a foothold in this industry. Market share concentration remains at a moderate to high level as prospective new entrants struggle to compete against established entities.

Largest companies grow market share through acquisitions

• The four largest companies in this industry, AT&T, Verizon, Comcast and CenturyLink, have historically dominated this industry due to their high name recognition and established customer base.

• In 2017, Verizon purchased XO Communications, enhancing its Ethernet capacity among enterprise and wholesale customers.

• Also in 2017, CenturyLink acquired Level 3 Communications, expanding its customer base through cross-selling additional services.

Companies expected to spin off wireline operations
• As demand for wireline services wanes, companies are expected to continue spinning off parts of their wired telecommunications operations to focus on more in-demand wireless telephony and broadband internet operations. In a 2015 agreement with Frontier Communications Corp., Verizon sold its exchange business and related landline activities in California, Florida and Texas. As spin-offs continue, market concentration is expected to decrease somewhat moving forward.

This industry provides local and long-distance voice communication services using the public switched telephone network. Industry operators also generate revenue by providing private network services and by wholesaling access to their networks for voice communication. This industry excludes operators that provide wired internet or video services and those that solely resell telecommunications services (IBISWorld report 51791a).

This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares.
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