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Communications Trends Driving Global Growth and Prosperity

Phillip Redman
Tuesday, July 4, 2006
Phillip Redman
Global telecommunications is rapidly changing with new wireless technologies, such as WiMAX (a family of protocols) and high-speed wireless data, emerging. Old wired data technologies, such as frame relay, are vanishing. Mergers, acquisitions and joint ventures provide benefits and challenges for these enterprise services. Communications services are changing rapidly with the growth in wireless minutes overtaking wireline (and global wireless service revenue surpassing wired in 2007), the future of fixed/mobile convergence, the impact of voice over Internet Protocol (VoIP) on enterprise and carrier services, and the continued mergers, acquisitions and consolidations. In many companies, the same groups are evaluating fixed and mobile services, especially as large service providers now will sell both wired and wireless. Big companies are only getting bigger. These trends will likely continue for the next 24 months driven by enterprise adoption and the increase in IT spending, as see in Exhibit 1.

Exhibit 1 Anticipated average increase in IT budgets
Some key trends in telecommunications are occurring:
l Speeding up of the technology cycle—From technology inception to maturity, more standards are delivering more products at the fastest pace ever. The development cycle between cellular phone models are shrinking, and what once took 24 months to produce from concept to finished product is down to under a year. The mobile WiMAX standard was ratified in December 2005, chipsets are already available and certified products will be on the market in 2007

2. Consumerization of the Enterprise—More products are being adopted by consumer or prosumer markets first than finding their way into the business. This is in reverse to past trends where technologies like cellular phone, networking or personal computers were on desktops in companies first before homes. Today products like instant messaging and Wi-Fi are finding their way into offices after the homes. Next on the list are digital vide recorders and music players. And like in the consumer market, form is important in business. Fashion outplays function and users expect more.

3. Telecom Convergence—This is basically a drive to move away from point solutions, wired and wireless, voice and data—and to consider products and services that are made up of both. How long have business users had two separate numbers and voice mail boxes? This is a move towards simplicity that at the same time will lower costs, drive productivity and be more secure.

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