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| Gartner Dataquest Says Telecom Markets Are Still Growing Despite Recession |
| Gartner Spotlight Report Examines Worst Hit Areas of Telecom as well as Growth Opportunities in the Industry |
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SAN JOSE, Calif., December 20, 2001 - While the current economic downturn has negatively impacted various segments of the telecom industry, there are still telecom markets that are growing, according to Dataquest, Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).
Worldwide telecommunications market revenue is on pace to reach $1.4 trillion in 2001, an 8 percent increase from 2000 revenue. The industry will continue to grow in 2002 with worldwide telecommunications revenue projected to reach $1.5 trillion. "Although several market sectors, particularly telecom equipment and infrastructure revenue, have been hit hard in recent months, the impact of the recession on the overall global telecom revenue industry will be minimal," said Dean Eyers, group vice president and worldwide director of Gartner Dataquest's Telecommunications and Networking group. These findings are part of the latest Gartner telecom Spotlight "Telecom Markets and the Recession: An Imperfect Storm." This Spotlight examines the worst hit areas as well as the growth opportunities in the telecom industry for the short term. Worldwide telecom equipment and infrastructure revenue is expected to reach $364.7 billion in 2001, down 4 percent from 2000 revenue of $381 billion. Gartner Dataquest analysts said there is reason for optimism, as the telecom services segment is emerging as the sector least susceptible to economic uncertainty. The worldwide telecom services market is forecast to have revenue surpass $1 trillion in 2001, a 13 percent increase from 2000. "The innate demand for basic voice capacity in developing markets and higher bandwidth in all markets will sustain a steady demand for telecom services," said Eyers. "It is much easier to delay a capital expense decision than it is to reduce reliance on a service which has become part of your business process or daily life." A key element in the year on year downturn in the equipment sector actually stems from very aggressive infrastructure build-out by the operators during 2000 which has trailed away in the wake of the dot.com implosion. While it will take a little time to take up this slack, the underlying demand remains strong, and this is a big factor in Gartner Dataquest's expectations of a return to growth over the next few years. The patterns vary significantly by region, with North America and Western Europe hardest hit during 2001, while the Asia/Pacific markets continue to expand. The market for mobile handsets, long seen as the bulwark of an era blistering growth in the mobile industry, is seeing the first ever evidence of a slowdown. Mobile vendors and service providers will find it hard to adjust to a period that sees growth cooling from "white-hot to just hot." "Overall, the climate will be one of adjusting to an era of slower growth, but, nevertheless, growth," Eyers said. "The explosive increase across many sectors in 2000 was clearly unsustainable and we will not return to those conditions. At the same time, it would be foolish to believe that the entire market is at stake - a number of sectors are still expanding today, and others will bounce back over the next two to three years." Additional information is available in the Gartner Spotlight "Telecom Markets and the Recession: An Imperfect Storm." This Spotlight includes Gartner Dataquest's most recent worldwide forecast for the telecom industry by region from 1999 through 2005. This research is published by Gartner Dataquest's Telecommunications and Networking group. This group provides analysis for the full spectrum of telecom and networking issues. To keep up to date on the latest telecommunications issues, please visit Gartner's Telecommunications Focus Area at www.gartner.com/1_researchanalysis/focus/telecom_fa.html. To subscribe to Gartner Dataquest programs, please call 408-468-8000. Reports can be purchase on the Internet at www.gartner.com. Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software and services sectors of the global information technology industry. Gartner, Inc. is a research and advisory firm that helps more than 11,000 clients understand technology and drive business growth. Gartner's divisions consist of Gartner Research, Gartner Consulting, Gartner Measurement and Gartner Events. Founded in 1979, Gartner, Inc. is headquartered in Stamford, Connecticut, and consists of 4,300 associates, including 1,200 research analysts and consultants in more than 90 locations worldwide. The company achieved fiscal 2001 revenue of $952 million. For more information, visit www.gartner.com. |
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Contact: Tom McCall 408-468-8312 tom.mccall@gartner.com |
