Ovum's recently published Global Wholesale Market Forecast: 2016–21 predicts that the wholesale market will be worth $213bn in 2021, accounting for 10.8% of total telecoms service provider revenues, up from $176bn in 2016. While revenues from carrying traditional voice traffic will continue their inexorable decline in the face of commoditization and migration to VoIP, those from nonvoice services will grow, with wholesale international backbone service revenues growing fastest between 2016 and 2021, supporting an ever-growing variety of retail communications services.
Retail communications service providers' dependence on wholesale will increase across the board
Ovum's wholesale telecoms team has recently completed an in-depth analysis of the global wholesale market (see Global Wholesale Market Forecast: 2016–21). This is Ovum's most detailed and comprehensive forecast to date of the market for wholesale services across the globe. It includes estimates of wholesale revenues for each of six service groupings for 25 countries, five regions, and the world. The forecast is supported by a Market Outlook report that presents detailed analysis of the global and national trends for each of these service groupings.
Significant growth is expected in revenues from wholesale last-mile and backbone services, although wholesale revenues MNOs can earn from MVNOs and MVNEs are forecast to be flat, and those from carrying national and international voice traffic will continue to decline. Each region will experience increased wholesale revenues across the forecast period, with the Latin America & Caribbean and Asia & Oceania regions growing fastest. By 2021, wholesale revenues in Asia & Oceania will be only 7% less than in Europe.
The new forecast revenues confirm our view (stated in the report Digital Economy 2025: Wholesale Telecoms) that wholesale telecoms will be key to the functioning of tech sector markets well into the future. Wholesale will become even more important to enable service providers to create and deploy new services and solutions, to reach new customers and markets, and to ensure that their services operate end to end across the globe.
However, wholesale revenues from services other than voice are not increasing in line with capacity and throughput demands. Therefore, wholesalers must be ever more flexible, efficient, and responsive if they are to succeed in an increasingly competitive marketplace.
While we are delighted to be able to publish this new forecast and the accompanying market outlooks, we are always open to discussing with wholesalers how we can further improve the usefulness and accuracy of our forecasts. Please contact the author to arrange a call.
Straight Talk is a weekly briefing from the desk of the Chief Research Officer. To receive this newsletter by email, please contact us.