Telecommunications Resellers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,800 telecommunications resellers in the US either sell local, long distance, or wireless phone services using other companies’ networks, or sell and install phone systems for businesses using third-party equipment. Local fixed line service resellers include competitive local exchange carriers (CLECs) who resell local phone services using the networks of incumbent local exchange carriers (ILECs). Equipment resellers resell products from equipment suppliers (Avaya, Cisco, etc.) and provide system integration services for small and medium businesses.
Transition To Internet Telephony
The telecommunications industry is in the midst of a transition from traditional fixed line circuit switching for voice traffic to packet switching of voice, data, and video over the Internet and wireless networks.
Dependence On Economy
Spending on telecommunications services is driven by business activity and demand for telecommunications resellers falls when the economy is weak.
Industry size & Structure
An average telecommunications reseller has about 22 employees and about $11 million in annual revenue.
- The US has about 1,800 telecommunications resellers who employ 40,000 workers and generate about $20 billion in revenue.
- The industry is moderately concentrated - the top 50 companies account for 82% of industry revenue.
- At the same time, there a large number of small companies - about 79% of telecommunications resellers have less than 10 employees.
Industry Forecast
Telecommunications Resellers Industry Growth
Recent Developments
Jul 16, 2024 - Employment Decreases
- Telecommunications resale industry employment decreased slightly during the first five months of 2024, according to the US Bureau of Labor Statistics. Telecommunications reseller sales are forecast to increase at a 2.79% compounded annual rate from 2024 to 2028, slower than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc.
- Bankruptcy filings continue increasing toward pre-pandemic levels, according to Epiq Bankruptcy, and telecommunications resellers may be negatively impacted as a result. New filings increased year over year across all US major filing categories during the first quarter of 2024. Total commercial chapter 11 filings (including subchapter V) registered the largest increase, as the 1,894 filings during the first quarter of 2024 were up 43% from the 1,325 total commercial chapter 11s during the same period in 2023. Total overall commercial bankruptcies increased 22% in the first quarter of 2024, as the 7,113 filings surpassed the 5,820 commercial filings during the first quarter of 2023. Subchapter V elections for small businesses increased 30% to 606 filings in Q1 2024 from the 465 filed during Q1 2023.
- Global smartphone shipments increased 7.8% year over year in Q1 2024 to 289.4 million units, according to IDC. “The smartphone market is emerging from the turbulence of the last two years both stronger and changed,” said Nabila Popal, research director with IDC’s Worldwide Tracker team. “We continue to see growth in value and average selling prices as consumers opt for more expensive devices knowing they will hold onto their devices longer.”
- Hackers are turning to traditional IT remote monitoring and management tools to execute cyberattacks on businesses and other organizations. Legitimate monitoring and management tools used by organizations including telecommunications resellers are being used by hackers to discover client-side applications and to conduct exploitation/post-exploitation activities. “The problem of course, is their effectiveness for legitimate security professionals make them effective for cybercriminals who crack them to remove any licensing requirements to use for free,” according to Chris Clements, vice president of solutions architecture at cybersecurity firm Cerberus Sentinel. “There are numerous hacker malware packages that are great for controlling computers, but they run the risk of being detected and removed by endpoint protection tools like anti-virus software and endpoint detection and response software,” Clements said. “Remote monitoring and management tools by and large eliminate this possibility as they are very often deployed for legitimate IT administration purposes.”
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