In one of our previous blog postings, we visited the topic of the rural farmlands as a huge boon to the telecom vendors here in the United States. As we embark on 2017, there is yet another new market that this industry should be looking at Business services.
Of course, all businesses have different types of needs, but it is the Small to Medium Business (SMB) sized market which could prove to be the most lucrative, and it is both Comcast and Charter which are taking the lead. The services offering includes the following:
- Fiber-based Ethernet;
- Software as a Service (SaaS);
- Next-Gen IP (such as SIP Trunking).
Just last week, Comcast reported that their revenues in this specialized niche were $1.4 Billion, which represents a 15% growth rate. Charter also reported a similar growth rate at, 12.1%. Cox also reported $2 Billion in revenues by simply serving the SMB organizations. Cable One and Mediacom also reported revenues at $3.1 Million and $58.1 Million, respectively.
According to Michael Cavanaugh, the CFO at Comcast: “We have a great product that’s very relevant in a market that we would size at $20 billion to $25 billion in the small and medium-sized space, where we’ve obviously deeply penetrated the small business side.”
But, despite these tremendous opportunities which are exemplified by these financial numbers, the competition will be extremely tough in vying to get a small business owner to purchase from one of these afore mentioned telecom vendors. For example, unlike a Fortune 500 company, an SMB has very limited resources and tight budgets at its disposal and thus does not possess the financial freedom to keep switching Vendors.
As a result, it will be a relationship building which will be of the utmost importance when winning an SMB contract for the Telecom Vendor. A small business owner wants to know that their provider will be around for the long term (with Ethernet services of long reach), and will keep offering prices that are affordable and manageable.
This idea is best summarized by Jeffrey Storey, the CEO at Level 3: “Cable is a good competitor and I am sure that Comcast customers are receiving a good experience, but if you look at the reasons why customers are buying services from Level 3, it’s the scope of the network.”
GeoTel Communications, LLC, is the leading provider of telecommunications infrastructure data in a geographic information system (GIS) and internet-based spatial technologies for over 15 years. GeoTel takes telecom infrastructure data and makes it tangible. By layering this data in GIS software or by viewing it in one of our web-based platforms, we make it possible to analyze detailed fiber optic maps and other telecom data sets throughout America. These integrated data sets are digitized onto the highest quality street data and aerial imagery available, providing companies and government entities with the leverage and insight necessary to make informed location-based and fiscally sound decisions.
