Fixed-line network operators investing in FTTH, IPTV capex, says Dell’Oro Group

Rather than spending on technology that might reduce operating expenses in providing voice telephone service, these operators are spending on what they identify as revenue-generating services.

A recent report from Dell’Oro Group indicates that despite a modest sequential increase in the third quarter this year, the carrier IP telephony market contracted almost 11 percent compared to the same quarter last year. The report indicates that operators will focus their 2009 budgets not only on growing revenue, but also reducing expenses in anticipation of weaker demand next year.

The downturn in the economy is compounding many trends at play in the market, according to Greg Collins, Dell’Oro Group VP. Cable and wireless networks continue to challenge wireline network operators for voice service, he said. As a result, “many fixed-line network operators are refocusing their investments on revenue-generating services and applications like fiber-to-the-home and IPTV, rather than investing in infrastructure that might reduce operating expenses,” he said.

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