By the end of 2010, telecom service providers worldwide will have outsourced about $53.5 billion worth of networking tasks to equipment vendors, according to a new report by Infonetics Research.
This represents 8% more than telcos outsourced in 2009, the research firm said.
"Fierce competition among telecom service providers around the world is driving them to increase operating expenses, and that in turn is forcing service providers to outsource more of their network tasks, because outsourcing is one of the last remaining ways to cut opex," said Stéphane Téral, Infonetics Research's principal analyst for mobile and FMC infrastructure.
With major outsourcing deals looming, the research firm predicts Ericsson, Nokia Siemens Networks, Alcatel-Lucent and Huawei may end up running three-quarters of the world’s networks.
Also, mobile network outsourcing is growing much faster than wireline outsourcing, the research firm said.
Infonetics expects that by 2014 mobile network outsourcing will account for 61% of all network outsourcing. In 2008 revenue from mobile and fixed network outsourcing was roughly the same.
The major growth areas for telecom network outsourcing include network maintenance, planning, design, and operations
Much of the growth in outsourced services is coming from EMEA (Europe, Middle East, Africa) and Asia Pacific, and to a lesser extent, Central and Latin America.