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Telecommunications Services in Vertical Markets 2004-2009
a market research report
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Telecommunications services are commodity products by their very nature since they exhibit little or no customization. Telecom providers recognize the commodity nature of their product when they market horizontally—promoting all products to everyone, everywhere. To escape the commodity trap and the attendant pricing competition, carriers must turn to vertical marketing-solutions targeted to user problems within specific industries. The
vertical market approach pinpoints telecom spending inclinations by various industries; it is the key to successful business planning, and a necessary ingredient for effective target marketing and sales force deployment.
In its annual review of vertical markets, Insight examines spending patterns on local, long distance, ISP, and wireless services for 14 business classifications including: healthcare, construction, retail trade, wholesale trade, educational services, financial, insurance, real estate, professional business services, hotels and lodging, transportation, communications, utilities, entertainment and media, durable manufacturing, and non-durable manufacturing. Insight quantifies the requirements of each vertical market and their likelihood to increase telecommunications services spending over time.
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Report Excerpt
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Telecom profit margins are rapidly deteriorating in the US market, in part, because carrier offerings are perceived as commodities. To dispel this belief and restore the telecommunications industry to sustainable growth, vendors will have to reach deeper into the US market, focusing on specific opportunities and catering to precise communications needs. In this context, a vertical industry opportunity focus can be calculated by:
· evaluating the size and revenue potential of each vertical industry and · determining the provider’s expertise in each particular market segment.
Failure to respond to the business market’s demand for specialization will allow competitors to capture market share early on, relegating slow-starters to a residential/consumer focus—a market that will tighten under pressure from cable TV operators.
Vertical markets, therefore, represent real opportunities for the telecommunications industry. The objective of this market research report is to examine and quantify these opportunities in various vertical industries for the telecommunications service provider community. INSIGHT examines 14 vertical markets in this report, segmented according to Standard Industrial Classification (SIC) developed by the US Department of Commerce and the North American Industry Classification System (NAICS) developed by the Bureau of Labor Statistics (BLS). These 14 vertical markets represent nearly 85 percent of the total number of establishments in the US.
Telecommunications products and services
are, by their very nature, commodity products, since they exhibit little or
no customization. Telecom providers recognize the commodity nature of their
product when they market horizontally—offering everything to everyone,
everywhere. Horizontal marketing provides generic “one-size-fits-all”
offerings. In contrast,...
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complete Executive Summary.
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Market Segmentation
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US Total Wireline Market by
Provider Type US Business Wireline Market
by Provider Type US Business Expenditures in Vertical Markets
US Wireline Data vs. Voice Markets
US Wireline Data Expenditures in Vertical Markets
US 800 Services in Vertical Markets
Vertical Markets:
Health care
Construction
Retail Trade
Wholesale Trade
Educ,Social Svcs & Mem Org
Financial, Insurance, RE Svcs
Professional Business Svcs
Hotel & Lodging
Transportation
Communications
Utilities
Entertainment & Media
Durable Manufacturing
Non-Durable Manufacturing
All Others
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Table of Contents
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Telecommunications Services in Vertical Markets 2004-2009
TABLE OF CONTENTS
Chapter I EXECUTIVE SUMMARY 1.1 Vertical Industry Telecommunications Spending 1.2 Telecommunications and Vertical Marketing 1.3 Telecommunications Expenditures by Vertical Industry
Chapter II MARKET OVERVIEW
2.1 Classification Systems 2.2 Segmentation and Performance 2.2.1 Wholesale Trade 2.2.1.1 S&P Indices 2.2.2 Financial, Insurance, and Real Estate Services 2.2.2.1 S&P Indices 2.2.3 Professional Business Services 2.2.3.1 S&P Indices 2.2.4 Communications 2.2.4.1 S&P Indices 2.2.5 Durable Manufacturing 2.2.5.1 S&P Indices 2.2.6 Health Care 2.2.6.1 S&P Indices 2.2.7 Retail Trade 2.2.7.1 S&P Indices 2.3 Telecommunications Service Trends 2.3.1 Primary and Secondary Access Line Growth 2.3.1.1 Access Line Forecast 2.3.2 Cable Telephony Trends 2.3.2.1 Small and Medium Small Business Cable Telephony Forecast 2.3.3 Private Line Trends 2.3.3.1 Private Line Forecast 2.3.4 Long Distance Trends 2.3.4.1 Long Distance Forecast 2.3.5 Toll Free Service Trends 2.3.5.1 Toll Free Service Forecast
Chapter III DRIVERS AND EXPENDITURES 3.1 Drivers of Telecom Expenditures 3.1.1 Growth in Employment 3.1.2 Growth in Occupations 3.1.3 Size and Number of Establishments 3.2 Telecom Expenditures by Vertical Markets 3.2.1 Long Distance 3.2.2 Data Communications 3.2.2.1 Direct Dial 3.2.2.2 ISDN 3.2.2.3 DSL 3.2.2.4 T-1 3.2.2.5 T-3 3.2.2.6 800 Lines
Chapter IV SITE STUDIES 4.1 Overview 4.1.1 Education Purchasing Trends 4.1.2 Government Purchasing Trends 4.2 Average Monthly Long Distance Expenditure (per emp. per site) 4.2.1 Amegen, Inc. 4.3 Total Data Lines 4.3.1 University of Illinois, Urbana-Champaign 4.3.2 University of Cincinnati 4.3.3 University of South Florida 4.3.4 Texas Tech University 4.3.5 New York Office of General Services 4.4 Direct Dial Lines 4.4.1 Abbott Laboratories Corp. 4.5 Integrated Service Digital Network (ISDN) 4.5.1 G E Capital Corporation 4.5.2 US National Naval Medical Center 4.5.3 Edward L. Doheny Memorial Library 4.6 Digital Subscriber Lines (DSL) 4.6.1 University of Colorado 4.7 Total T-1 Lines 4.7.1 Public Service Electric & Gas Company 4.8 Total T-3 Lines 4.8.1 Tribune Company 4.9 800 Lines 4.9.1 Delta Air Lines
Chapter V VERTICAL MARKET FORECASTS 5.1 Overview 5.2 Methodology 5.3 Prognoses 5.3.1 US Total Wireline Market 5.3.2 US Business vs. Residential Wireline Markets 5.3.3 US Business Expenditures in Vertical Markets 5.3.4 US Wireline Data vs. Voice Markets 5.3.5 US Wireline Data Expenditures in Vertical Markets
Appendix GLOSSARY Table of Figures
Chapter I
I-1 Drivers of Telecom Expenditures in Vertical Markets I-2 Total US Telecom Wireline Market, 2004 and 2009 ($Billions) I-3 Top Tier Expenditures for Telecom Services, 2004 and 2009
Chapter II II-1 Median and Mean Age per US Census Estimates, 1995-2000 II-2 Telecommunications Growth Cycle II-3 US Access Line Annual Additions, 1985-2002 (Millions) II-4 US Wireline Access Annual Reductions, 2001-2008 (Thousands) II-5 Typical Layout for a Full Circuit II-6 US LD Min of Use Quarterly Growth Rates, % Change 2000-2003 II-7 US Intrastate and Interstate LD Minutes, 1990-2008 (Billions)
Chapter III III-1 Drivers of Telecom Expenditures in Vertical Markets III-2 Total US Employment, 1986, 1996, 2006, 2012 (Millions) III-3 Total US Business Establishments, 1992-2005 (Millions) III-4 Average Monthly LD Expenditures per Emp. by Company Size
Chapter V V-1 US Total Wireline Revenue, 2004-2009 ($Billions) V-2 US Wireline Expenditures by Business vs. Residential V-3 US Business Top Tier vs. All Other Telecom Expenditures V-4 US Total Wireline Broadband Data Revenue V-5 US Business Wireline Data Market Share of Local and LD
Table of Tables
Chapter II II-1 SIC Divisions II-2 Classification System Coding II-3 NAICS Divisions II-4 Wholesale Trade Representative Indices II-5 Financial, Insurance, and Real Estate Representative Indices II-6 Professional Business Services Representative Indices II-7 Communications Representative Indices II-8 Durable Manufacturing Representative Indices II-9 Health Care Representative Indices II-10 Retail Trade Representative Indices II-11 Four Cable Telephony Delivery Options II-12 Cable Telephony Service Delivery Model II-13 Total Private Line Revenue, 2000-2009 ($Millions) II-14 Call Center Toll-free Usage by Transaction Type II-15 Toll-free Expenditures by Vertical Industry
Chapter III III-1 Employment by Major Occupational Groups III-2 Fastest Growing Occupations, 2002-2012 (Thousands) III-3 Distribution of US Companies by Size, 2000 III-4 Telecom Expenditures by Vertical Market III-5 Industries in the Data Comm Lines and Corr.Vertical Markets III-6 Average Monthly LD Expenditures per Employee by Size III-7 Rank of Average Monthly LD Expenditures per Employee III-8 Average Monthly LD Expenditures per Site by Size, 2004 III-9 Rank of Average Monthly LD Expenditures per Site by Size, 2004 III-10 Average Number of Data Communications Lines per Site III-11 Rank of Data Communications Lines per Site by Size, 2004 III-12 Average Number of Direct Dial Lines per Site, 2000-2003 III-13 Rank of Direct Dial Lines per Site by Size, 2004 III-14 Average Number of ISDN Lines per Site, 2000-2003 III-15 Rank of ISDN per Site by Size, 2004 III-16 Average Number of xDSL Lines per Site, 2000-2003 III-17 Rank of DSL Lines per Site by Size, 2004 III-18 Average Number of T-1 Lines per Site, 2000-2003 III-19 Rank of T-1 Lines per Site by Size, 2004 III-20 Average Number of T-3 Lines per Site, 2003 III-21 Rank of T-3 Lines per Site by Size, 2004 III-22 Average Number of 800 Lines per Site, 2003 III-23 Rank of 800 Lines per Site by Size, 2004
Chapter IV IV-1 University of Illinois, 2004 Fiscal Year Budget ($Millions)
Chapter V V-1 US Total Wireline Revenue by Type of Provider, 2004-2009 V-2 US Business Wireline Revenue by Type of Provider, 2004-2009 V-3 US Business Telecom Wireline Expenditures by Vertical Market V-4 US Business Wireline Broadband Data Revenue as a Percentage of Local and LD, 2004-2009 ($Billions)
V-5 US Business Wireline Data Market Share, 2004 and 2009
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Pricing Information
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Hard Copy
Price
$ 1998
Electronic Copy Price
(PDF License Descriptions)
$ 2348 Single-User Printable PDF
$ 3498 6-Seat Printable PDF
$ 5000 Unlimited Corporate-Wide Distribution
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