Infonetics Forecasts Global Managed Telecom Carrier Outsourcing Market to Reach $76B by 2016

By Laura Stotler

The market for managed telecom carrier outsourcing will reach $76 billion globally by 2016, according to a new report from Infonetics Research. The "Service Provider Outsourcing to Vendors" report features information on market size and share, as well as forecasts for the managed services space.

The report specifically tracks the revenue vendors derive from services they provide to their telecom carrier customers. It shows the service provider outsourcing market is set to reach a whopping $65 billion worldwide by the end of this year, representing an 11-percent increase from 2011.

Other findings in the Infonetics report include a forecast for managed services revenue to outpace the overall outsourcing market with eight percent CAGR through 2016. Revenue includes the sum of operations, network maintenance, planning and design.

Opex reduction remains the top driver for carriers outsourcing network tasks like designing, building, maintaining and billing to managed providers.

The report also finds that a combination of large deals in Africa like that between Zain and Ericsson, along with medium-sized deals involving RAN-sharing activity across western Europe, has sustained the EMEA region as the largest market for outsourced services. About one-third of the world's subscriber base is managed by traditional telecom vendors including Alcatel-Lucent, Ericsson, Huawei and Nokia Siemens Networks.

That number has risen 29 percent in just the last six months.

In addition to market sizes and forecasts, the report tracks trends for service provider fixed-line and mobile network outsourcing to vendors, as well as revenue that vendors derive from a variety of services.

These include network planning and design, building, maintenance, operations, application service delivery, service provisioning and activation, and billing services for network operators.

"We anticipated that service providers across the board would continue to outsource at an unabated pace, but revenue in the first half of 2012 is already two percent higher than expected, with all OEM vendors reporting healthy growth in outsourcing, professional and managed services," said Stéphane Téral, principal analyst for mobile infrastructure and carrier economics at Infonetics Research. "This gives us pause to ask what would happen to some of these vendors if they didn't have a presence in services."

Edited by Braden Becker

MSPToday Contributing Editor

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