Strategic acquisitions and rebounding corporate profit will facilitate industry growth
Los Angeles, CA (PRWEB) May 01, 2012
Firms in the Dark Fiber Network Operators industry lease or sell their unused fiber-optic cables to telecommunications or internet-based companies for the purpose of creating a communications network. The existence of dark fiber networks has been around for as long as fiber-optic cables. According to IBISWorld industry analyst Nikoleta Panteva, “As the amount of data and broadband use has grown, demand for networks that support communication has increased as well, thus supporting industry revenue growth.” Over the five years to 2012, IBISWorld estimates that revenue will grow at an average annual rate of 3.7% to reach $986.2 million.
While revenue stagnated during the recession due to the discounted rate at which dark fibers were offloaded, growth has been substantial in the years that have followed. In 2010, Dark Fiber Network Operators industry revenue grew an estimated 6.6%, followed by an additional 7.3% increase in 2011. IBISWorld expects revenue to continue on its upward trajectory during 2012, growing by 7.7%. Says Panteva, “The combination of increased broadband connections and rebounding corporate profit has supported strong revenue growth during the past five years.”
The industry's largest players have outpaced overall industry growth because of their strategic acquisitions. To gain resources (e.g. fiber-optic cables), players often buy the capital of smaller companies because it is too costly to install new cables. As a result of the acquisition activity, the number of participating firms has declined each year on average since 2007 to 165 in 2012. The trend is likely to continue over the five years to 2017 – though at a less pronounced rate. The industry is considered to have a low level of concentration. But as operators continue to seek out a competitive advantage by providing an expansive dark fiber network for large telecommunications companies that allows them to improve their products and services, industry concentration will increase over the next five years. Meanwhile, growing corporate profit and demand for data transfer will continue to underpin industry revenue growth. For more information, visit IBISWorld’s Dark Fiber Network Operators in the US industry report page.
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IBISWorld industry Report Key Topics
This industry primarily leases unlit (unused) direct fiber-optic networks to third-party organizations. The industry excludes companies that primarily provide lit services and proprietary and traditional cable operators.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.