Telecommunications private line market begins recovery in 2006, says Insight Research Corporation

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BOONTON, NJ. June 22, 2005:

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The market for private line services is expected to continue its contraction through the remainder of 2005 before firming prices take hold in 2006, signaling the start of a recovery in this $35 billion telecommunications segment, says market analysis study from Insight Research.  Private lines are point-to-point circuits leased by enterprises from telecommunications carriers in order to link enterprise sites to each other and to the Internet.

 According to Insight’s report, Private Line and Wavelength Services 2005-2010, price compression and competition precipitated private line revenue losses beginning in 2003.  Recent events, however—such as industry consolidations and the Triennial Remand Order issued by the FCC on February 4, 2005—are reshaping the private line business and will drive a recovery that is expected to take off as early as 2006.  In the study, Insight reports that from 2005 to 2010 the overall private line market will grow at a compound annual growth rate (CAGR) of 2.5 percent, reaching $36.5 billion in revenue by 2010. 

“Believe it or not, this is a dynamic market.  We believe that the traditional private line market will eventually be cannibalized by newer technologies, such as IP services and gigabit Ethernet services, but right now it is a huge profit center for the carriers,” says Insight president Robert Rosenberg.  “How quickly the market morphs will be dependant in large part on how quickly the carriers reinvest the profit from their traditional private line services into other technologies.  The fun part will be watching how the newly consolidated SBC/AT&T and Verizon/MCI tackle the end-user’s need for end-to-end data services in light of these new technology options.”

Private Line and Wavelength Services 2005-2010 evaluates the total private line market and segments by local and long distance private line service revenue, wholesale and retail private line revenue, revenue by type of carrier, revenue by T1, T3 or OC-n circuit class, as well as the number of T1, T3, OC-n private lines sold.

 A free report excerpt, table of contents, and ordering information are available online at http://www.insight-corp.com/reports/privatewave05.asp.  Contact P.J. Conger, Director of Marketing at 973-541-9600 for additional information.

Private Line and Wavelength Services, 2005-2010

Marketing Dept.

at Insight Research

973-541-9600