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BOONTON, NJ. September 29,
1997:
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Sprint and MCI have been turning up the marketing hype, all in an effort to grab market share before the RBOCs enter the long distance business, says a new market analysis report from
Insight Research. With RBOCs temporarily stalled by the FCC, the IXCs have had ample time to devise their strategies and take the competitive lead, reports
Insight.
According to Insight's The RBOCs and Long Distance, the RBOCs will have to consider substantial price drops to make long distance buyers shift to their brands. The RBOC dilemma is that they are not ready for the profit stress that a real price war would require. Instead, the RBOCs planned to offer customers multifaceted bundles of services--local, long distance, wireless, and Internet--on one bill, a powerful selling point. But the long distance companies, skirting the limits of the Telecom Act's joint marketing provisions, have been putting such packages together before the RBOCs have even arrived at the starting gate.
"The RBOCs still have some trump cards to play," says Robert Rosenberg, president of
Insight. "They have the logistical ease of starting out as long distance resellers, while the IXCs face corresponding logistical difficulties such as interconnection. Plus the local business market is far more complex and expensive," Rosenberg added.
According to Insight, RBOCs will also benefit with their strong regional identities and ties to the small-to-medium-sized customer, a rapidly growing segment of the telecom market.
In determining potential new RBOC revenue, Insight evaluated interLATA,
intraLATA, and international traffic, reduced access charges, and the elasticity effect that lower prices may have on stimulating additional LD calling. INSIGHT expects overall RBOC market share to grow to 25 percent of the domestic market by 2002, totaling over $19 billion in revenue.
Further forecasts of long distance revenue are published in The RBOCs and Long Distance.
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Private
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2003-2008
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Optical
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2003-2008
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Telecom
Services in Vertical Markets
2002-2007
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Telecom
and Ethnic Groups: Uses of Local, Long Distance, and Wireless in Ethnic
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