Analyst: Telecoms service provider revenues hit $1.85 trillion

Analyst: Telecoms service provider revenues hit $1.85 trillion

Claims four per cent market growth result of strong mobile economy in BRIC

Revenues in the global telecoms service provider industry grew four per cent to reach $1.85 trillion in 2010, according to independent technology analyst, Ovum.

A report by the company showed the growth was driven by strong mobile economies in the Brazil, Russia, India and China (BRIC).

According to the report, which looks closely at the 2010 financial performance of telecoms carriers worldwide, the progress is an improvement from 2009 – when revenues fell by four per cent.

Average profitability, measured by metrics such as operating cash flow and net profit margins, net debt and EBITDA (earnings before interest, taxes depreciation and amortisation) showed positive results as well.

Ovum principal analyst and author of the report, Matt Walker, said it is too early to rejoice just yet but, within the context of a slowly improving global economy, the telecoms sector is returning to sustainable growth.

Findings also showed opportunity for vendors. Although service provider capital expenditure (capex) declined by three per cent in 2010, this was a rise from the nine per cent capex dropped in 2009. In the fourth quarter of 2010, capex rose two per cent compared with Q4 2009.

The Asia-Pacific region (excluding India and China) had the second best regional capex growth in 2010.

“The late pick-up of global capex in 2010 drove the full-year results. There is usually a fourth quarter budget flush, but 2010 was stronger than 2009, when most carriers remained jittery,” Walker said.

Many big vendors benefited from their top-line YoY growth for Q4 in 2010: ZTE recorded 40 per cent growth; Juniper, 26 per cent, Alcatel-Lucent - 13 per cent, Ericsson 11 per cent and Nokia Siemens Networks' (NSN) with 0.5 per cent to hit $5.4 billion – NSN’s first positive YoY revenue growth since Q3 in 2008.

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Tags TelecommunicationsjuniperZTEAlcatel-Lucent. Ericssonglobal telecoms provider industryNokia Siemens Networks (NSN)

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