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U.S. Data Transport Services Market Growing at a Fast Rate: Report


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June 04, 2010

U.S. Data Transport Services Market Growing at a Fast Rate: Report

By Deepika Mala, TMCnet Contributor

According to Frost & Sullivan (News - Alert), the U.S. data transport services market is growing at a rate of 4.6 percent. With the launch of Ethernet virtual private line service by most leading carriers, the market potential for wholesale E-Line services is likely to get enhanced.

The market revenues, due to multiprotocol label switching and Ethernet services are expected to ramp up. The growth rate for these services, year-on-year are pegged at 10-12 percent for MPLS and 20-30 percent for Ethernet.
Private line and synchronous optical networking services are likely to command a major share of data transport revenues in the near future. A modest, but steady inflow of revenues has been maintained by the private line services, particularly DS1 and SONET services.
As per the U.S. Data Transport Services Market Overview conducted by Frost & Sullivan, it has been found that the market earned revenues of over $33.0 billion in 2009 and estimates $40.0 billion in 2014.
"Wavelength services are seeing a growth spike owing to escalating demand for higher bandwidth circuits," said Frost & Sullivan Research Analyst Roopa Shree H. "Also, the emergence of Ethernet has revived the wavelength services market as a number of service providers use waves to provision Ethernet circuits, and most 1 GigE and 10 GigE Ethernet circuits provisioned today are over dense wavelength division multiplexing."
Owing to market migration from these technologies to newer IP-based ones such as MPLS and Ethernet, legacy services, particularly frame relay and asynchronous transfer mode, are declining at a faster pace than expected.
Because of the price competitiveness of IP-based services that offer more bandwidth for a lower cost, their growth in revenues are not as rapid as the decline in revenues for FR and ATM.
The U.S. data transport services market is dominated by the Tier 1 carriers. Competition is expected to intensify in the MPLS and Ethernet arena, as carriers begin to position themselves as solution providers.
"Large carriers are seeing a surge in demand for high bandwidth transport services -- especially MPLS VPN for multipoint-to multipoint connectivity for large distributed enterprises," Roopa Shree H, says. "Also, large carriers are showing increased interest in integrating Telepresence type of solutions with MPLS, which obviously makes sense for large enterprises."
In related news, LiveVox (News - Alert) Inc has won the 2010 U.S. Frost & Sullivan Award for Contact Centers' Choice: Best Brand of Hosted Outbound Customer Contact Solution in the U.S. Market.

Deepika Mala is a contributing editor for TMCnet. To read more of her articles, please visit her columnist page.

Edited by Marisa Torrieri

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