Global Communications Power: Worldwide Market Forecasts

Topics Covered include:

* Regional Market Share
* Application Forecasts
* Power Systems Forecasts
* 60/90Vac Power Supply Forecasts
* Engineering and Installation Forecasts

This 21-page Power Paper provides an overview of the worldwide communications power system market, including forecasts and analysis of applications, power systems, and engineering and installation services. It also includes a worldwide regional market share discussion for North America, Europe, Asia, China, Central and Latin America and Rest of World. The underlying infrastructure and business factors driving these markets are analyzed for each forecast, including the effects of build-out and pricing. A detailed discussion of the opportunities in engineering and installation services is presented.

Scope:

This Power Paper encompasses the following areas:

(1) Estimates for the potential worldwide market for communications power systems in units, dollars and pricing from 2005 to 2010, broken down by application and power system. It also includes estimates for the potential worldwide market for engineering and installation services in dollars during the same period.

(2) A detailed analysis of the following worldwide markets is included: Wireline, Wireless and CATV; and Micro Power Systems, Small Power Systems, Medium Power Systems, Large Power Systems and CO-Class Power Systems. Power Systems is further broken out in dollars by Rectifiers, Batteries, and Other (ac distribution, dc-dc converters, inverters, monitoring modules, dc distribution, and so on). A separate forecast is given for 60/90Vac power supply systems used in CATV outdoor plants or cabinets.

Methodology:

Primary and secondary research was conducted of both makers and end-users of communications power systems and subsystems. In addition, communications power system
integrators and equipment makers were polled to help determine industry trends and growth rates. The research was in no way limited to companies in North America, with the implicit
understanding that a significant portion of the systems produced by the major OEMs are shipped outside of their region.

The detailed methodology proceeded as follows:
(1) A series of telephone, fax and e-mail interviews were conducted by Darnell Group with a select group of vendors and power system users/specifiers. During interviews, a checklist
was used to make sure that no points were overlooked. The primary research efforts were directed to major users of the various types of communications power systems. The use of
multiple primary data sources (e.g., end-equipment makers and communications power suppliers) enabled cross-validation and ensured the highest possible database quality and reliability.

(2) To develop and confirm the engineering and installation service forecasts, two surveys were prepared and sent to 60 companies who offer telecommunications equipment
installation and engineering services. One survey was sent to �dedicated� installation and engineering services companies (i.e. companies who focus solely on this service); while the second survey was sent to companies who also sell equipment or offer other services. The surveys were brief and sent to each survey participant via email and fax. From this group, 14 surveys were returned representing both initial groups. These were followed up
with a series of phone interviews. During interviews, a checklist was used to make sure that no points were overlooked. The use of additional multiple primary data sources (e.g., end-equipment makers and communications power suppliers) enabled cross-validation and ensured the highest possible database quality and reliability. The responses provided were deemed to be complete and believed to be accurate, partly based on the high percentage of respondents providing consistent data. Also, there were many primary sources consulted for specific information outside of the questionnaire participants. The information collected from these additional respondents was integrated into several sections of the report.

(3) The primary data collected in the survey was supplemented by secondary data gathered from a variety of published sources including previous industry studies, trade journals,
proceedings from related trade conferences, annual reports, 10ks, product literature, advertising, industry web pages, newspapers and periodicals, previous reports, related
work performed by the Darnell group and a variety of other sources.

Executive summary
All the forecasts in this report were prepared using a spreadsheet program. The use of formulas in calculations can generate decimals, which require rounding to the nearest significant figure. As a result of rounding, the sum of a set of numbers may be different from what the numbers appear to add up to. This is because when the spreadsheet adds up the numbers, it takes into account the decimals that are not shown in the numbers. The reason we choose to leave the sums as they are is to retain the formulas in the spreadsheet and maintain the integrity of the statistical analysis.The Worldwide Communications Power System market has experienced declines over the past
few years, although there are signs that this market is picking up. This is likely to translate into flat sales as opposed to declining sales, however. In certain markets, such as wireless, the actual number of base stations is expected to increase slightly, although price pressures will keep revenue flat. Broadband access is expected to be a key driver of equipment spending in the Worldwide communications power market. The introduction of IP networks, along with the rollout of 3G and Wi-Fi services, will also boost equipment sales. The total Worldwide dollar market for both wireline and wireless Power Systems is projected to be $4,292 million in 2005, growing to $4,418 million in 2010, a compound annual growth rate of 0.6%.

In an effort to expand the power system market, companies have turned to engineering and installation services (E&I) to augment revenue. These services have existed on a broader equipment-installation level, but power system makers are focusing the services specifically to power. So far, it seems to be paying off: The worldwide E&I market for wireless/wireline power systems is estimated to grow 6.2% between 2005 and 2010, from 1,057 million to $1,425 million. Compared with the 0.6% growth of the power system market, the 6.2% growth of the E&I market has proven more attractive to companies over the past few years.

Still, the overall communications power system market is not expected to exhibit the same explosive growth it had during the mid-to-late 1990s, at least during this forecast period. Except for some of the E&I services, growth will remain below 10% for all segments in all regions, with most segments being flat. Although unit sales are picking up, downward pricing will keep revenues low.