TIA Playbook

An overview of the ICT market, technologies, and policies that drive innovation and investment

Manufacturers and suppliers of Information and Communications Technology present…

TIA2012PLAYBOOK

tiaonline.org

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TIA BENEFITS

TIA POLICY PRIO

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INDUSTRY OUTLOOKKEY CONTACTS

L E A D E R S H I P G R A N T S E I F F E R [email protected] H E R Y L B L U M Vice President, Technology & Standards+1.703.907.7436 [email protected] I L E E N B R A M L E TVice President, Marketing & [email protected] E R B C O N G D O NAssociate Vice President, Technology & [email protected]

J O H N J A C O B S Sr. Vice President, Membership, Marketing & Business Development+1.703.907.7747 [email protected] N D R E W K U R T Z M A N Vice President & Corporate Counsel+1.703.907.7413 [email protected] A LY W A L S HVice President, Networking & Intelligence +1.703.907.7744 [email protected] A R Y P I P E R W A T E R SSr. Director, [email protected]

For more information on TIA’s public policy positions and activities, please contact one of the TIA government affairs staff members below:

G O V E R N M E N T A F F A I R S D A N I E L L E C O F F E YVice President & General Counsel, Government [email protected] O S E P H A N D E R S E NDirector, Technology & Innovation [email protected] I CO L A S A . F E T C H KODirector, International & Government [email protected]

B R I A N S C A R P E L L IManager, Government [email protected] I L E E P S R I H A R IDirector, Legislative & Government Affairs [email protected] A R K U N C A P H E RDirector, Regulatory & Government [email protected]

INDUSTRY OUTLOOKKEY CONTACTS

TELECOMMUNICATIONS INDUSTRY ASSOCIATIONCONNECTIVITY, INNOVATION, LEADERSHIP, AND RESPONSIBILITY are Core Values of TIA. Our mission is to turn those values into initiatives that benefit our membership and the manu-facturers and suppliers of global networks.

Companies that join TIA share a common vision for the future of the Information and Communications Technology industry—a vision that informs their strategic planning and satisfies their business goals. TIA members gain exclusive access to the latest intelligence on information and communications technologies and participate as industry leaders to create standards and advise on government and industry policy.

IF YOU THOUGHT THE WORLD WAS SHRINKING,

YOU HAVEN’T SEEN ANYTHING YET.

INDUSTRY OUTLOOKTIA POLICY PRIORITIES TIA POLICY PRIORITIES

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INNOVATION LEADS TO JOB AND ECONOMIC GROWTHADVANCE GLOBAL COMPETITIVENESS THROUGH:

j Market Access and Trade

j Research and Development

j Education and Talent

j Tax Reform

ENABLE FORWARD-LOOKING TECHNOLOGIES WITH:

j Spectrum Availability

j Global Cybersecurity

j Green ICT and Smart Grid

j Accessibility

DRIVE INVESTMENT THROUGH:

j Tax Incentives

j Market-Based Regulations


INNOVATION REAPS BENEFITSTHE TIA ROADMAP will drive investment in broadband networks and applications, accelerating social and economic development by:

j CONNECTING communities and enterprise customers with the essential 21st century infrastructure.

j SUSTAINING, redefining, creating, and multiplying jobs.

j ENHANCING productivity, enabling teleworking.

j INCREASING eco-sustainability and smart grid deployments through intelligent technologies.

j OFFERING new tools for public safety and homeland security.

j IMPROVING public health facilities through telemedicine, digital hospitals, and e-records.

j FACILITATING e-government.

j FOSTERING powerful educational tools in the classroom and boosting distance-learning capabilities.

j MAKING the power of communications accessible to all.

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INNOVATION DRIVES JOBS j ICT COMPANIES ACCOUNTED for 3.5 million jobs in 2009, with average compensation for ICT workers more than 80 percent higher than for the workforce overall.

j ICT FIRMS CONTRIBUTE about $1 trillion to the U.S. GDP through both direct and indirect contributions — about 7 percent of the U.S. economy.

j ICT’S DIRECT CONTRIBUTIONS to GDP have increased nearly 25 percent since the 1990s, growing from 3.4 percent per year in 1991-1993 to an average of 4.2 percent per year in 2005-2009 — gains unmatched by any other industry.

j THE PRESIDENT’S PROPOSAL to fund the development and initial deployment of a nationwide wireless broadband data and communications network for public safety agencies would lead to the creation of an estimated 100,000 new jobs in ICT industries and, over time, produce indirect or spillover benefits of an estimated $4 billion to $8 billion per year.

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RECAPTURE GLOBAL COMPETITIVENESSLAWMAKERS CAN RECAPTURE GLOBAL COMPETITIVENESS THROUGH:

j MARKET ACCESS & TRADE — Securing access to international markets by promoting trade liberalization and a market-based, technology-neutral approach to regulation in international markets.

j RESEARCH & DEVELOPMENT — Strategic and robust U.S. investment in telecommunications research, including a permanent R&D tax credit, multi-year federal research plans, and a commitment to long-term research will enable the United States to remain a technology industry leader.

j EDUCATION & TALENT — The future of the ICT industry in the United States depends on providing the necessary support for education in science, technology, engineering, and mathematics (STEM) for our students while enacting immigration reforms to allow companies to attract and retain the best and brightest minds from around the world.

j TAX REFORM — Comprehensive tax reform will affect the competitiveness of U.S. firms, which are already disadvantaged by virtue of the fact the U.S. corporate tax rate is the second highest in the world. TIA will press for reform that will cut the effective U.S. corporate tax rate to a level that will enhance the inter-national competitiveness of U.S. firms.


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U.S. MUST ACHIEVE LEADERSHIP IN BROADBANDBroadband Penetration 2011 (Percent)Source: TIA’s 2012 ICT Market Review and Forecast

SwitzerlandNetherlands

IcelandDenmark

South KoreaNorwayFrance

LuxembourgSweden

GermanyBelgium

United KingdomCanada

Hong KongMalta

FinlandUnited States

JapanBahrainEstonia

0 5 10 15 20 25 30 35 40

j THE U.S. LAGS BEHIND OTHER DEVELOPED NATIONS in broadband deployment.

j THE U.S. RANKED 17th in broadband deployment in 2011, rising from its 18th place ranking in 2010.

j THE U.S. MUST NOT BE OUTPACED by major trading partners in deployment of cutting-edge technologies and networks.

j LACK OF BROADBAND CONNECTIVITY INHIBITS JOB CREATION in the U.S.


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MARKET ACCESS AND TRADETIA POLICIES SECURE ACCESS TO INTERNATIONAL MARKETS by promoting trade liberalization and a market-based and technology-neutral approach to regulation in international markets:

j BUSINESS DEVELOPMENT OPPORTUNITIES for U.S. suppliers should be facilitated by promoting full, fair, and open competition in international markets.

j TRADE AGREEMENTS should be promoted that eliminate or reduce traditional market-access and technical barriers to trade.

j EXISTING COMMITMENTS by signatories to the World Trade Organisation (WTO) Border Tax Adjustment (BTA), Information Technology Agreement (ITA), Government Procurement Agreement (GPA), and Technical Barriers to Trade (TBT) should be enforced.

j COMMUNICATIONS SERVICES must be liberalized on a technology-neutral basis.

j BILATERAL AND MULTILATERAL TELECOM agreements should provide transparency, independent regulatory authority, nondiscrimination against foreign suppliers, and technology neutrality.

j THE DEVELOPMENT AND IMPLEMENTATION of export control mechanisms that enhance the abilities of companies to export their products overseas should be supported.

j THE U.S. EXPORT CONTROL REGIME should be modernized to increase transparency and clearly delineate jurisdiction between the Commerce and State Departments.


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TOP TRADE DESTINATIONS FOR U.S. EQUIPMENT j IN 2010, EUROPE WAS THE LARGEST MARKET for U.S. equipment exports, followed by Latin America and Asia Pacific.

j IN 2010, THE TOP 10 EXPORT DESTINATIONS together, which comprised 59 percent of all U.S. telecommunications equipment exports, accounted for $9.6 billion in telecommunications equipment purchases from the United States.

j MEXICO WAS THE LEADING DESTINATION for the export of American telecommunications equipment in 2010, accounting for $2.5 billion, a six-year high.

U.S. Exports of Telecommunications Equipment by Region 2010 Source: TIA’s 2012 ICT Market Review and Forecast

Middle East/Africa7.9%

Canada11%

Europe32.8%

Asia Pacific23.9%

Latin America24.5%

11%

Europe

Pacific23.9%

America24.5%


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CHINA: SECTOR SNAPSHOT

Telecommunications Subscribers in China (Millions)Source: TIA’s 2012 ICT Market Review and Forecast

j CHINA HAD THE LARGEST TELECOMMUNICATIONS MARKET in Asia Pacific at $388 billion in 2011.

j CHINA IS THE LARGEST FIXED BROADBAND MARKET in the world, with 135 million subscribers in 2011.

j BY 2015, CHINA WILL HAVE 195 MILLION BROADBAND SUBSCRIBERS, representing 56 percent of the Asia Pacific region’s total subscriber growth.

j CHINA HAS THE LARGEST WIRELESS MARKET in the world, with 950 million wireless subscribers in 2011. By 2015, it is expected to grow by another 400 million subscribers to 1.35 billion subscribers.

j IN CHINA, THE GOVERNMENT IS LOOKING TO EXPAND INTERNET reach to 45 percent of the population by 2015 from 29 percent at the end of 2009.

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

350 368 366 340 314 294 275 260 250 240

393461

547641

747859

9501,050

1,150

1,350

Wireless

Landline

245

1,250


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INDIA: SECTOR SNAPSHOT

Telecommunications Subscribers in India (Millions)Source: TIA’s 2012 ICT Market Review and Forecast

j INDIA WILL BE THE FASTEST-GROWING telecommunications market during the next four years, with projected compound annual increases of 12.2 percent, overtaking Japan in 2014 to become the second largest telecom country in the region.

j IN 2011, INDIA HAD THE SECOND LARGEST wireless market in Asia Pacific with 850 million subscribers, projected to reach 1.25 billion by 2015.

j INDIA ADDED AN AVERAGE of more than 8 million wireless subscribers per month in 2011.

j FIXED BROADBAND REMAINS LIMITED in India — penetration was 1.1 percent in 2011 — because of poor infrastructure in rural areas, where 70 percent of the population lives.

5041 39 38 37 35 34 33 32 31

90 166234

347

525

752850

9501,050

1,250

Wireless

Landline

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

32

1,150


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RESEARCH & DEVELOPMENTSTRATEGIC AND ROBUST U.S. INVESTMENT IN TELECOMMUNICATIONS RESEARCH including a permanent R&D tax credit, multi-year federal research plan, and a commitment to long-term research will enable the United States to remain a technology industry leader.

j INCREASED FEDERAL RESEARCH FUNDING MUST BE ALLOCATED for network- and communications-specific, precompetitive, basic research.

j THE U.S. GOVERNMENT MUST MAKE LONG-TERM COMMUNICATIONS RESEARCH A PRIORITY, and funds need to be directed to key areas: universal broadband; security; interoperable mobility; and homeland security-related fields including inter-operability, security, survivability and encryption.

EDUCATION & TALENTTHE FUTURE OF THE ICT INDUSTRY IN THE U.S. depends on providing the necessary support for education in science, engineering, and technology for our students while enacting immigration reforms to allow companies to attract and retain the best and brightest minds from around the world.

j ENACTMENT OF IMMIGRATION REFORMS should facilitate the retention of engineers and scientists in the United States, especially recent graduates from U.S. universities, to improve and strengthen our domestic workforce.

j CONGRESS MUST FUND THE AMERICA COMPETES ACT (PL 111-358) and maintain a commitment to invest in Science, Technology, Engineering, and Mathematics (STEM) education to help ensure that America is educating the workforce of the future.


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TAX REFORM COMPREHENSIVE TAX REFORM will affect the competitiveness of U.S. firms, which are already disadvantaged by virtue of the fact that the U.S. corporate tax rate is the second highest in the world. TIA will press for reform that will cut the effective U.S. corporate tax rate to a level that will enhance the international competitiveness of U.S. firms.

j CONGRESS MUST PASS LEGISLATION TO REDUCE THE OVERALL CORPORATE TAX RATE and to create a lower tax rate for repatriated funds, which will encourage domestic investment and boost our nation’s economy.

DRIVE INVESTMENTLAWMAKERS SHOULD DRIVE INVESTMENT in broadband networks and services through:

j TAX INCENTIVES — Through incremental tax credits, expensing, and bonds, the U.S. government can increase investment in our nation’s future and domestic prosperity.

j MARKET-BASED REGULATIONS — A continued light-touch approach to regulation, as well as certainty in the marketplace, will ensure continued investment in a technology-neutral manner.


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TAX INCENTIVES TIA ENCOURAGES the U.S. government to increase investment in our nation’s future and domestic prosperity through the enactment of incremental tax credits, expensing, and bonds.

j TAX POLICIES SHOULD BE IMPLEMENTED THAT WILL DRIVE INVESTMENT IN BROADBAND through tiered tax incentives that accelerate as the speed offered by such service increases, recognizing differing tiers and floors depending on the technology deployed.

j THE UNITED STATES MUST ENACT A PERMANENT R&D CREDIT, which will allow companies to make long-term research plans while being assured that the credit will continue for the life of the project.


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MARKET-BASED REGULATIONSA CONTINUED LIGHT-TOUCH APPROACH TO REGULATION, as well as certainty in the marketplace, will ensure continued investment in a technology-neutral manner.

j GOVERNMENT MUST ENHANCE EFFORTS to stimulate investment and innovation in next-generation broadband.

j NETWORK OPERATORS should have the ability to engage in reasonable, pro-compet-itive network management.

j TECHNOLOGY AND SERVICE NEUTRALITY ARE CRITICAL, and when regulation is necessary, it should be structured to promote competition among existing and emerging platforms and providers.

j GOVERNMENT SHOULD ENSURE UNIFORMITY in regulation for IP-enabled services through exclusive federal juris-diction of these services by the Federal Communications Commission, which will lead to increased certainty and investment in the marketplace.

j TECHNOLOGY MANDATES by the government hamstring innovation and increase consumer costs.


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ENABLE FORWARD-LOOKING TECHNOLOGIESTIA CALLS ON POLICY MAKERS to enable forward-looking technologies through:

j SPECTRUM AVAILABILITY — Innovative, next-generation wireless devices, applications, and services require spectrum availability and mobile broadband use. The FCC and the Administration should move quickly to reallocate spectrum and conduct voluntary incentive auctions using the new authority provided by Congress, while avoiding burdensome regulations.

j GLOBAL CYBERSECURITY — Global approaches to cybersecurity policies in the U.S. and internationally are necessary to avoid policies that could negatively impact market access, interoperability, and global security.

j SUSTAINABLE ICT — Appropriate federal-level policies are critical to driving ICT’s potential to reduce energy consump tion in ICT energy-intensive sectors. Smart grid, smart buildings, and travel substitution are key to energy efficiency and sustainable practices.

j ACCESSIBILITY — By encouraging collabo-ration among stakeholders and the use of voluntary, consensus-based standards, the U.S. government can increase the accessi-bility of technology to those with disabilities and encourage innovation, and in doing so will open up new employment opportunities for this vulnerable community.


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j CONSUMERS EXPECT CONNECTIVITY and access to voice, video, and data services any time, any place, with any device, over any network.

j NEXT-GENERATION NETWORKS are revolution izing the way we share information and communicate, for example, through broadband video and VoIP.

j APPROXIMATELY ONE THIRD of Americans subscribe to VoIP services.

CONSUMERS QUICKLY ADAPT

VoIP Subscribers in the U.S. (Millions)Source: TIA’s 2012 ICT Market Review and Forecast

Residential Subscribers

Business Subscribers

30.633.331.9

29.0

3.8

8.6

14.017.1

19.9

25.227.2

1.61.8 2.1 3.0 3.6 3.7 4.1 4.5 4.9 5.4 5.9

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

IPTV Subscribers in the U.S. (Millions)Source: TIA’s 2012 ICT Market Review and Forecast

0.3

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

0.92.0

15.517.5

13.511.5

8.56.2

4.4


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BROADBAND GOALSTIA CALLS ON THE ADMINISTRATION, CONGRESS, and other government bodies to adopt a framework that supports the following goals:

j UNIVERSALLY AVAILABLE, high-quality, and affordable broadband connectivity.

j CONSUMERS’ ABILITY TO CONNECT to and access content over the Internet.

j NETWORK OPERATORS’ ABILITY to engage in reasonable, pro-competitive network management.

j TECHNOLOGY-NEUTRAL COMPETITION among existing and emerging platforms and providers.

j INCREASED AVAILABILITY of unencum-bered spectrum in large and contiguous blocks for commercial services, located adjacent to like uses.

j UTILIZATION OF MARKET-BASED MECHANISMS to drive spectrum to its highest and best uses.

j UNIFORMITY IN REGULATION, where appropriate, including federal rules wherever possible.

j ELIMINATION OF REGULATORY BARRIERS to investment and innovation.


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SPECTRUM AVAILABILITYTIA’S SPECTRUM POLICIES ARE FOCUSED ON UNIFYING Congress, the Administration, and the FCC in making more spectrum available for wireless broadband, allowing innovators to speed products to the market while ensuring maximum efficiency in use and global spectrum harmonization.

j THE FCC AND THE ADMINISTRATION should promptly reallocate spectrum and expedite voluntary incentive auctions using their new authority from Congress. These auctions will facilitate increased efficiency in frequency use, encourage sharing arrange-ments where necessary, and will allow current licensees and the federal government to reap financial benefits from making spectrum available for wireless broadband.

j GOVERNMENT SHOULD ADOPT FORWARD-LOOKING, market-oriented spectrum management policies, seek additional spectrum allocations for mobile broadband services, and finalize any remaining issues regarding deployment of an interoperable public safety communications network as soon as possible.

j GLOBAL HARMONIZATION AND COORDINATION of spectrum allocations should be a priority.

j TECHNOLOGY AND SERVICE NEUTRALITY ARE KEY — service providers must be given the flexibility to choose technologies and platforms independently based on commercial and competitive considerations.


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j GOVERNMENT POLICIES SHOULD ENCOURAGE A STABLE regulatory environment that relies primarily on market forces and avoids government intrusion into new and evolving services.

j GOVERNMENT SHOULD MAXIMIZE THE PUBLIC BENEFITS of spectrum use by controlling harmful interference, fostering competition, and quickly imple-menting the recommendations of the National Broadband Plan calling for 300 MHz of spectrum availability by 2015 and a total of 500 MHz available by 2020, as well as the Presidential Memorandum ordering 500 MHz of federal and nonfederal spectrum that is suitable for both mobile and fixed wireless broadband use to be made available over the next 10 years.

j RESPONSIBLE GOVERNMENTAL AGENCIES SHOULD COORDINATE to ensure that additional spectrum for advanced wireless services is made available in a timely manner.

j SPECTRUM ALLOCATION AND ASSIGNMENT should be made by open and transparent processes that are market-driven and provide for government/industry consultation. Forward-looking management of radio spectrum is essential to the goals of making telecommunications services accessible and of ensuring that the public derives maximum benefit from spectrum use.

SPECTRUM AVAILABILITY, CONT.


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CONSUMER DEMAND WILL REQUIRE SPECTRUM

j EACH OF THE MAJOR CARRIERS is introducing 4G services on a retail basis, and they will be expanding their networks significantly in the next few years.

j DATA WILL ACCOUNT FOR 65 PERCENT of overall wireless services spending in 2015. The growth of the data segment is being driven by the explosion in the number of smartphones, whose owners generate more than 10 times the data traffic of standard cellphone owners.

j ACCORDING TO ESTIMATES FROM THE FCC, the average demand for mobile data will exceed capacity by nearly 300 MHz by 2014 — an increase of 3,506 percent relative to 2009.

2009 2010 2011 2012 2013 2014

4000

3500

3000

2500

2000

1500

1000

500

0

Average Data Growth

Traffic Growth per Site*

Tech-Adjusted Traffic per Site**

* Data demand adjusted for additional cell sites. ** Data demand adjusted for spectral efficiency improvements.

Traffic Growth (Percent)Source: FCC Report – Mobile Broadband: The Benefits of Additional Spectrum


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GLOBAL CYBERSECURITYTIA WILL CONTINUE TO ENCOURAGE GOVERNMENT TO WORK SEAMLESSLY WITH INDUSTRY to secure our nation’s networks, businesses, and consumers, calling for policies that enhance trade and promote communications security as a driver of innovation.

j GOVERNMENT AND INDUSTRY MUST PARTNER to increase dialogues between industry and government (domestic and foreign) experts to discuss international best practices. Nations should use inter-national best practices when developing cybersecurity policies.

j CYBERSECURITY POLICIES that keep markets open and minimize barriers to trade must be supported.

j ANY EXPANSION OF THE COMMUNICATIONS ASSISTANCE FOR LAW ENFORCEMENT ACT (CALEA) must not stifle innovation and must ensure technology neutrality.

j THE UNITED STATES MUST SERVE AS A LEADER in developing national cyber-s ecurity priorities, risk assessments, and security recommendations for use by both the private sector and government entities.


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SUSTAINABLE ICT AND SMARTER POWERAPPROPRIATE FEDERAL-LEVEL POLICIES DRIVING ICT’S POTENTIAL to reduce energy consumption in other more energy-intensive sectors through smart grid, smart buildings, and travel substitution are key to creating jobs and helping U.S. industry compete successfully in global markets.

j PROMOTE THE ROLE OF ICT in sustainable technologies that reduce energy consumption and carbon emissions for new buildings and existing buildings.

j STOP “SMART GRIDLOCK” to unlock the full potential of the smart grid through private and secure access to energy supply and usage data.

j PROMOTE TECHNOLOGY NEUTRALITY in smart grid policy to encourage competition and innovation.

j EMPOWER COMPLEMENTARY PROGRAMS, like the Sustainable Technology Environments Program (STEP), that go beyond construction into the lifetime operation of new and existing buildings.

j SUPPORT FUNDING for both R&D and deployment of green ICTs such as smart grid, telepresence, guiding automations, and more.

j ENCOURAGE GREATER ADOPTION of telework and videoconferencing to reduce urban sprawl, ease traffic congestion, and facilitate travel substitution.

j EDUCATE POLICY MAKERS ABOUT the role ICT can play in improving energy efficiency through substitution of ICT for outdated technologies.


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ACCESSIBILITYTIA ENCOURAGES COLLABORATION AMONG STAKEHOLDERS and the use of voluntary, consensus-based standards to increase the accessibility of technology for those with disabilities and to encourage innovation, and in doing so open up new employment opportunities to this vulnerable community.

j GOVERNMENT MUST ADOPT PRO-COMPETITIVE POLICIES that encourage marketplace solutions and rapid deployment of accessible technologies while incorporating technical feasibility.

j UNIVERSAL SERVICE FUND PROGRAMS, such as the Lifeline discount, should be extended as efficiently as possible to fund broadband services and equipment for low-income Americans, because many consumers with disabilities live on a fixed income.

j PROACTIVE CONSULTATIONS WITH THE DISABILITY COMMUNITY and other stakeholders will lead to the incorpora-tion of accessible solutions into member companies’ product development process.

j THE GOVERNMENT SHOULD PROMOTE THE DEVELOPMENT OF VOLUNTARY, CONSENSUS-BASED INDUSTRY standards to address accessibility needs, repeating successes such as TIA-1083, which reduces magnetic interference on digital cordless phones for users with hearing aids.

INDUSTRY OUTLOOKINDUSTRY OUTLOOK INDUSTRY OUTLOOK

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NEW U.S. TRENDS, GROWTH DRIVERS j AGGRESSIVE FIBER DEPLOYMENT during the past two years will limit incremental growth during the next four years.

j GROWING PENETRATION of smartphones and tablets and rollouts of 4G wireless networks will boost data traffic.

j SURGING INTERNET AND MOBILE TRAFFIC will require high levels of ongoing infrastructure investment.

j SPENDING ON WIRELESS DATA will propel overall wireless services spending even as subscriber growth slows.

j IN THE ENTERPRISE, investment in more bandwidth to accommodate surging data traffic requirements and increased storage needs will stimulate spending.

For more information contact:F L O R E N C E S U M A R A Y Director, Marketing [email protected]

Statistics in this publication can be found in TIA’s 2012 ICT Market Review and Forecast.

j CLOUD COMPUTING will open up the market to increased use of applications by more companies. Growth in equipment spending to support these applications will offset the substitution effect of shifting premises-based equipment to the cloud.

j DATA CENTER CONSTRUCTION will grow in the near term and remain high throughout the forecast period.

j COST SAVINGS AND PRODUCTIVITY GAINS will continue to stimulate the conferencing market.

j AN EXPANDING ECONOMY will support growth in telecommunications spending during the next four years.


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TELECOMMUNICATIONS j THE UNITED STATES TELECOMMUNICATIONS MARKET WAS AFFECTED BY GLOBAL ECONOMIC CONDITIONS MORE THAN OTHER REGIONS and experienced only 1.0 percent growth in 2010, but rebounded with a 5.9 percent increase in 2011. International spending rose 6.5 percent in 2011, less than the 7.6 percent increase in 2010. In 2012, spending in the United States is expected to exceed the level reached in 2008.

Telecommunications Spending in the U.S. ($ Billions)Source: TIA’s 2012 ICT Market Review and Forecast

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

847932

1,021 1,062976 986

1,0431,103

1,1651,226

1,283


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Spending by Carriers on Telecommunications Equipment in the U.S. ($ Billions) Source: TIA’s 2012 ICT Market Review and Forecast

j THE INFRASTRUCTURE MARKET RECOVERED in 2011 with a 23.7 percent advance following the modest decline of 0.3 percent in 2010. Spending growth will increase 3.6 percent compounded annually, reaching $41.8 billion in 2015.

NETWORK EQUIPMENT

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

41.8

26.429.3

34.3 32.529.4 29.3

36.3 38.5 39.4 40.9

j CUMULATIVE BACKBONE SPENDING DURING THE NEXT FOUR YEARS will total an estimated $78.4 billion compared with $50.8 billion during the past four years, a 54 percent increase.

j A PICKUP IN FIBER DEPLOYMENT, the early stages of spending related to the stimulus package, a stabilized economic environment, and the need for increased network capacity have contributed to the surge in backbone equipment spending.


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WIRELESS EQUIPMENT j WIRELESS EQUIPMENT SPENDING ROSE to $54 billion in 2011 and will be more than $60 billion annually through 2015.

j WIRELESS INFRASTRUCTURE EQUIPMENT SPENDING WILL GROW at an 8.1 percent compound annual rate; and wireless device spending will grow 2.4 percent compounded annually between 2012 and 2015, totaling a combined $70.7 billion in 2015.

Wireless Equipment Spending in the U.S. ($ Billions)Source: TIA’s 2012 ICT Market Review and Forecast

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

32.1

13.7

17.4

21.022.7 24.0

25.3

29.132.2 33.1 32.4

38.6

12.1

16.9 17.820.0

17.620.1

24.9

28.9

32.3

35.7

Handsets

Infrastructure

INDUSTRY OUTLOOKINDUSTRY OUTLOOK MARKET OVERVIEW

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j CABLE OPERATORS ARE INCREASING BANDWIDTH TO OFFER BI-DIRECTIONAL SERVICES, including high-speed Internet, which has been augmented by installing DOCSIS 3.0 to deliver Internet speeds of up to 50 Mbps.

CABLE

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

11.0

13.8 14.215.8

14.2 14.4

18.5 18.216.8 16.0 15.4

j THE COMBINATION OF NEW SERVICE OFFERINGS BY MULTI-SERVICE OPERATORS, including cable, stimulated increased fiber deployments in 2011 to 18.5 million fiber miles. Fiber deployments are forecast to decline at a 4.5 percent compound annual rate to 15.4 million fiber-miles in 2015.

Single-Mode Fiber Deployed in the U.S. (Fiber-Miles, Millions)Source: TIA’s 2012 ICT Market Review and Forecast

INDUSTRY OUTLOOKINDUSTRY OUTLOOK MARKET OVERVIEW

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TELECOMMUNICATIONS SERVICES

Transport Services Spending in the U.S. ($ Billions)Source: TIA’s 2012 ICT Market Review and Forecast

Wireless Services

Landline Services

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

j OVERALL LANDLINE SPENDING GREW 4.1 PERCENT IN 2011, after declining three consecutive years. Wireless services grew 10.0 percent. SMS, photos, music, games, and wireless Internet access are growing rapidly.

j INTERNET ACCESS AND IPTV WILL OFFSET the decline in the landline voice services market.

j DEVICE MANUFACTURERS WILL OFFER CONTENT-BASED SERVICES and applications, which are fueling the demand for wireless service.

210.3

113.5125.5

138.9 148.1 152.6 159.9175.9

188.6 199.9

146.7

192.8 185.8 184.1 180.7159.4 150.2 147.9 146.9 146.9

220.3

145.9

INDUSTRY OUTLOOKMARKET OVERVIEWMARKET OVERVIEW

3 4� T I A 2 0 1 2 P L A Y B O O K

EMERGING NETWORK SERVICESEMERGING NETWORK SERVICES — unified communications, videoconferencing, public room services, audioconferencing service bureau spending, Web conferencing, and IT-based cloud computing — are the fastest-growing components of the telecommunications market. Spending rose 16 percent to $11.9 billion in 2011, led by a 28.4 percent increase in cloud computing and 18.8 percent growth in Web conferencing.

j UNIFIED COMMUNICATIONS ROSE 7.7 percent to $1.6 billion.

j VIDEOCONFERENCING PUBLIC ROOM SERVICES INCREASED 3.3 percent to $1.3 billion.

j AUDIOCONFERENCING SERVICE SPENDING GREW 5.1 percent to $3.2 billion.

j WEB CONFERENCING ROSE 18.8 percent to $2.0 billion.

j IT-BASED CLOUD COMPUTING INCREASED 28.4 percent to $5.8 billion.

INDUSTRY OUTLOOKMARKET OVERVIEWMARKET OVERVIEW

T I A 2 0 1 2 P L A Y B O O K 3 5

SPECIALIZED SERVICES

2008 2008 2010 2011 2012 2013 2014 2015

20

18

16

14

12

10

8

6

4

2

0

VoIP

Cloud Computing

IPTV

Web Conferencing

Spending on VoIP, IPTV, Web Conferencing and IT-Based Cloud Computing in the U.S. ($ Billions)

Source: TIA’s 2012 ICT Market Review and Forecast

INDUSTRY OUTLOOKMARKET OVERVIEW MARKET OVERVIEW

3 6� T I A 2 0 1 2 P L A Y B O O K

INTERNATIONAL MARKETTHE INTERNATIONAL MARKET COUNTINUED TO REBOUND in 2011, reflecting stabilizing economic conditions following the global recession in 2009.

j NATIONAL BROADBAND PLANS throughout the world are generating investment in broadband infrastructures and extending the broadband reach to rural and other unserved areas through fixed and mobile technologies.

j LARGE GAINS in broadband and wireless penetration will fuel growth in Asia Pacific, with most of the growth generated by China and India.

j MIDDLE EAST/AFRICA will again be the fastest-growing region during the next four years, averaging 10.0 percent growth compounded annually through 2015, fueled by double-digit gains in fixed broadband, wireless services, and equipment.

INDUSTRY OUTLOOKMARKET OVERVIEW MARKET OVERVIEW

T I A 2 0 1 2 P L A Y B O O K 3 7

International Telecommunications Revenue by Region ($ Billions) Source: TIA’s 2012 ICT Market Review and Forecast

Canada EuropeMiddle East/AfricaLatin AmericaAsia Pacific

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

1,800

1,600

1,400

1,200

1,000

800

600

400

200

0

INTERNATIONAL MARKET

INDUSTRY OUTLOOKTECHNOLOGY & STANDARDSTECHNOLOGY & STANDARDS

3 8 T I A 2 0 1 2 P L A Y B O O K

TIA STANDARDS PROGRAMACCREDITED BY THE AMERICAN NATIONAL STANDARDS INSTITUTE (ANSI) to develop voluntary consensus industry standards for a wide variety of telecommunications products and systems, creating specifications for public safety radio equipment, cellular towers, data terminals, satellites, telephone terminal equipment, accessibility, VoIP equipment, structured cabling, data centers, mobile device communications, multimedia multicast, vehicular telematics, machine-to-machine communications, and smart utility mesh networks, among others.

j SUPPORTS 12 PRODUCT-ORIENTED ENGINEERING COMMITTEES, consisting of:• 70+ subcommittees and working groups;• Representatives from manufacturers, service

providers, consultants, and end users, including federal, state and local government.

j PROVIDES SECRETARIAT SERVICES to groups that develop international standards, such as Third Generation Partnership Project 2 (3GPP2) and Technical Advisory Groups (TAGs) for forums such as IEC, ISO, and JTC-1.

ENGINEERING COMMITTEESTR-8: Mobile and Personal Private Radio StandardsTR-14: Point-to-Point Communications SystemsTR-30: Multi-Media Access, Protocols and InterfacesTR-34: Satellite Equipment and SystemsTR-41: User Premises Telecommunications RequirementsTR-42: User Premises Telecommunications Cabling

InfrastructureTR-45: Mobile and Personal Communications SystemsTR-47: Terrestrial Mobile Multimedia Multicast (TM3)TR-48: Vehicular TelematicsTR-49: Healthcare ICTTR-50: Smart Device Communications (SDC)TR-51: Smart Utility Networks

INDUSTRY OUTLOOKTECHNOLOGY & STANDARDSTECHNOLOGY & STANDARDS

T I A 2 0 1 2 P L A Y B O O K � 3 9

TIA STANDARDS MISSIONSUPPORT STANDARDS DEVELOPMENT PROCESSES that are timely, cost effective, open, transparent, fair, and nondiscriminatory and driven by commercial interests to find technical solutions to communications needs.

PROMOTE PRIVATE-SECTOR SOLUTIONS and commercially-oriented decisions for technology deployment.

WORK WITH TIA POLICY TO: j Participate in the standards process as an end user.

j Procure equipment based on industry-developed standards.

j Work with Congress and executive agencies to ensure a level playing field for all standards worldwide.

j Provide assistance to trade officials to resolve standards-related and other technical barriers to trade.

For more information contact:C H E R Y L B L U M Vice President, Technology & Standards+1.703.907.7436 [email protected]

Learn more about TIA’s standards activities at tiaonline.org/standards.

TIA BENEFITS

INDUSTRY OUTLOOKINDUSTRY OUTLOOK TELECOMMUNICATIONS INDUSTRY ASSOCIATIONTELECOMMUNICATIONS INDUSTRY ASSOCIATION

40� T I A 2 0 1 2 P L A Y B O O K

TIA 2012 puts the focus on the people, the products and the companies driving innovation and optimization of The Network.

Visit tia2012.org

and get on the Keep Me Informed

list.

I�NSIDE THE NETWORKJUNE 5–7, 2012 DALLAS, TEXAS

This is your industry event — one strong community of technology suppliers and service providers that form the foundation of the global communications experience.

MEANINGFUL AND ENGAGING EDUCATIONAL CONTENT! j Optical — Are You Part of the 100G Ecosystem? j Green ICT — Energy-Efficient Equipment, Innovation and New Thinking on Network Architecture. j Multiscreen TV — Transition to the New World of IP-Based Three-Screen Delivery. j M2M + Cloud + Standards = The Internet of Things. j Visual Communications and Conferencing.

j Cloud Optimization — Monetizing the Enterprise Rush to the Cloud. j Network Convergence. j Who’s Who in the Industry, Including AT&T, Verizon and Alcatel-Lucent.

For more information contact:M I C H E L L E M E L S O P Event [email protected]

TIA BENEFITS


T I A 2 0 1 2 P L A Y B O O K 4 1

April 27-29, 2012 • CAmbridge, mArylAnd

As network convergence and the worldwide reach of the Internet spur tech-nological advancement and new business models, it is critical for companies to work with Members of Congress, the White House, the FCC, and other agencies to develop policies that drive innovation and open markets. TIA’s annual Spring Policy Summit brings decision makers from all of these venues, together with industry and other key influencers, to discuss and debate the top policy priorities of the information and communications technology industry.

The 2012 Spring Policy Summit brings decision makers from all these forums, together with industry and other key influencers to discuss and debate the top policy priorities of the ICT industry.

To register for this year’s Spring Policy Summit,

go to tiaonline.org.


4 2� T I A 2 0 1 2 P L A Y B O O K

TIA Now is the industry authority analyzing the ICT World:

If you are interested in sponsoring any of our featured programs or would like us to create a custom-produced video in the TIA Studio, please contact:

A B E N E J A D ICT Journalist/Anchor +1.703.907.7004 [email protected]

Latest ICT Insights and TrendsHottest Issues • Influential Guests • Leading Programs

j Delivering engaging content to an audience of 90,000 ICT executives and decision makers.

j Offering a unique position within the industry on all ICT issues.

j Providing compelling programming that spans policy, news, emerging technologies, and evolving business strategies.

j Ensuring strategic lead generation and branding opportunities for your firm.

Featured programming includes: All The Angles DC Beat From the Top Innovating Standards The List

Markets in Motion Member Spotlights TIA Now Webinar SeriesTIA Now Documentary Series


T I A 2 0 1 2 P L A Y B O O K 4 3

TIA continues to lead the way for Manufacturers and Suppliers of Global Networks — and remains the clear choice for your company! Currently in its 88th year, the Telecommunications Industry Association (TIA) represents the global information and communications technology (ICT) industry through:

j TECHNOLOGY AND STANDARDS DEVELOPMENT

j POLICY AND ADVOCACY

j BUSINESS OPPORTUNITIES

j NETWORKING

j MARKET ANALYSIS

j WORLDWIDE ENVIRONMENTAL REGULATORY ANALYSIS

Hundreds of companies like yours work through TIA to enhance the business environment for telecom, broadband, mobile wireless, information technology, network, cable, satellite, emergency communications, and sustainable technologies.

Learn more at tiaonline.org A N C I L L A B R A D Y Director, Member Relations +1.703.907.7713 [email protected]

Industry outlookIndustry outlook telecommunIcatIons Industry assocIatIontelecommunIcatIons Industry assocIatIon

44 t I a 2 0 1 2 P l a y B o o k

tIa MeMbersThe TelecommunicaTions indusTry associaTion’s member companies include Thousands of information and communications technology (ICT) professionals participating in standards, government affairs, market intelligence, and product-oriented environmental compliance.

Discover how you can gain a competitive advantage in the broadband economy by leveraging TIA’s full range of services by contacting TIA’s Membership Department at +1.703.907.7713 or [email protected].

2M Companies, Inc.Accedian NetworksAccess PartnershipACSAdax, Inc.ADTRANAegis Mobility Inc.Aeris Communications Inc.AeroflexAirvana, Inc.AirWalk CommunicationsAlcatel-Lucent

Allen Tel ProductsAllied Telephone and

Data Corp.Alpha TechnologiesAlteryx LLCAltior Inc.American RoamerAmplicom USA, LLCAnagran, Inc.Anritsu MTBUAnue SystemsApple

Applied Communication Sciences

AST Technology Labs, Inc.Astrolab Inc.ATDI Inc.AttivaCorpAvtec Inc.Baxter EnterprisesBechtel Power Corp.Beecher Communications

ConsultantsBel Stewart ConnectorsBerk-Tek

Blind Creek AssociatesBridgewater Systems Inc.BTECH, Inc.BTR Netcom Inc.C Faulkner EngineeringC LinkCABACALTROP Construction ServiceCanoga Perkins Corp.Capitol Technology Affairs, LLCCarrier Digit Computer Software


T I A 2 0 1 2 P L A Y B O O K 45

Cassidian Communications, Inc.

CCT TECH USA Inc.CDMA Development GroupCellular Networking

PerspectivesChatsworth Products, Inc.Cisco Systems, Inc.CJ Barber ConsultingClearSounds CommunicationsCME ConsultingCML Microcircuits (USA) Inc.CommScope Network SolutionsCommunications Solutions

GroupComprion GmbHConnectivity Technologies, Inc.ConverlogicCoptex InternationalCore NAP, LPCorning IncorporatedCRIQCSF CorporationCSI Telecommunications, Inc.

CTA Communications, Inc.CyanDan-Chief Enterprise Co., Ltd.Datron World CommunicationsDBSD North AmericaDDB UnlimitedDell Inc.Diamond USA, Inc.Digital Voice Systems, Inc.Dolby Laboratories Inc.Douglas BatteryDow Electrical &

TelecommunicationsDraka Comteq Optical FibreDSET CorporationDTC (UK) LimitedDY-Link Engineering &

TechnologiesDYMO RHINOE.F. JohnsonElite Electronic Engineering Co.Erico, Inc., Caddy Fastener

DivisionEricsson Inc.

ERT-Electronic Recycling & Trading

ESRI Inc.EtherstackExperior Laboratories, Inc.Fairfax County Economic

Development AuthorityFAL AssociatesFiberSource Inc.Fluke NetworksFrye-Comm Consulting LLCFTR&D LLCFurukawa Industrial S.A.Future Call LLCGallery IP TelephonyGemalto Inc.GENBAND Inc.Georgia Institute of TechnologyGlobalstarGoodman Networks Inc. Gray Beards ConsultingGraybarHarger, Inc.

Hargis Engineers Inc.Harris CorporationHellermannTytonHenkels & McCoy Inc.Hitachi Cable ManchesterHitachi Telecom Inc. USAHK Engineering and ServicesHostway CorporationHughes Network Systems, LLCICCIcom America Inc.Ideal Industries, Inc.Ifbyphone, Inc.IHSILS TechnologyIncrediTekInstitute of Telecom ResellersIntegra NetworksIntel CorporationInteligroup GlobalInterNetworking Link LLCInterop TechnologiesIntersect Inc.


46� T I A 2 0 1 2 P L A Y B O O K

Intertek Testing ServicesIntradoIP FabricsISE IncorporatedJ&M Consultants, Inc.J. Upton ConsultingJenne DistributorsJPMorgan Chase & Co.Juniper Networks, Inc.KEITIKenwood USA Corp.Kong Profit Technology LimitedKGP LogisticsLeviton Network SolutionsLG InfoComm U.S.A., Inc.Lightwave MagazineLittelfuse Inc.Lockheed Martin CorporationManagement Resources

InternationalMcAfee, Inc.McObject LLCMediatech Design Group

MegaSys Computer Technologies

MeggerMicrosoft CorporationMidland Radio CorpMinuteman UPS/Para Systems,

Inc.Mitsubishi Electric AutomationMJ Lynch & AssociatesMobileAccess Networks, Inc.Motorola Mobility Inc.Motorola SolutionsMRV Communications, Inc.Mu Dynamics, Inc.MUTINational Circuit AssemblyNational Technical SystemsNEINetIG LLCNexans - NIESNICTNokia Inc.Nokia Siemens Networks

Northwest Information ServicesNotor ResearchNovatel Wireless Inc.Noyes Fiber SystemsNumerex Corp.Occam Networks, Inc.OFSOmnitron Systems Technology,

Inc.One2many B.V.OneChip PhotonicsOptelian Access NetworksOptical Cable CorporationOptical InterconnectOptoTest Corp.Ortronics, Inc.Oscilloquartz USAOutside Plant MagazineOverture Networks, Inc.PacketStorm Communications,

Inc.Panasonic Corp. of

North AmericaPanduit Corporation

Phoenix ContactPhoenix OptixPhoton Kinetics, Inc.Pitney Bowes Business InsightPower & Telephone Supply Co.PowerTrunkPPCQuabbin Wire & Cable Co., Inc.QualcommR.J. EnterprisesRAD Data CommunicationsRAM Network Services, LLCRaytheonReliance TM TCORELM Wireless Corp.Research In MotionRIT Technologies Inc.Rohde & Schwarz, Inc.RTKL Associates Inc.Samsung Telecommunications

AmericaSandvine IncorporatedSatra-Peru SAE


T I A 2 0 1 2 P L A Y B O O K 4 7

Schweizer Engineering Laboratories, Inc.

SDT - Southern Diversified Technologies

Sector Supply LPSencoreSensata TechnologiesSEVEN NetworksSGS Wireless US, Inc.Shenzhen Sanmy Technology

Co.Sierra Wireless America, Inc.Sigma Delta Communications,

Inc.Signamax Connectivity

Systems, Inc.Silver Spring Networks, Inc.Sisvel US Inc.Solaris Technologies Inc.Sony Wireless Tech DivisionSPATIALinfo

Spinnaker Wireless Inc. SS8 Networks, Inc.SSCStreakwave Wireless Inc.Sumitomo Electric Lightwave

Corp.SUNA LLCSuncall America, Inc.Surtec AmericaSynaptykTait Radio CommunicationsTANGOTECTaquaTarana Wireless Inc.Tatara SystemsTE ConnectivityTechnisonic Industries Ltd.TechOne Progressive SolutionsTelcordia TechnologiesTeleCommunication Systems,

Inc.

Tellabs, Inc.Thales Communications, Inc.The Fiber Optic AssociationThe Siemon CompanyTMC Radio Pty LtdTranstelcoTranSwitch CorporationTridium Inc.Tseng InfoServ, LLCTWI Group, Inc.Twisted Pair SolutionsTX RX Systems, Inc.UL Underwriters Laboratories

Inc.Unicom Electric, Inc.Uniden America CorporationUS Conec Ltd.Valid8Vector Structural EngineersVertek

VIA TelecomVital Communications Inc.VPISystemsVTech CommunicationsWalker and AssociatesWhitesell ConsultingWilkofsky Gruen AssociatesWiltec TechnologiesWireFreeCom Inc.WirelessCraftWISP-Router, Inc.WK3C Wireless LLCWonderful Hi-TechWyless Inc.Ygomi LLCZetron, Inc.ZTE Corporation

tiaonline.org

HEADQUARTERS2500 Wilson Blvd., Suite 300Arlington, VA 22201-3834 USAPhone: + 1.703.907.7700Fax: + 1.703.907.7727tiaonline.org

GOVERNMENT AFFAIRS10 G Street NE, Suite 550Washington, DC 20002-4213 USAPhone: + 1.202.346.3240Fax: + 1.202.346.3241

T E L E C O M M U N I C A T I O N S I N D U S T R Y A S S O C I A T I O N

AFFILIATE OFFICEUnited States InformationTechnology Office (USITO)Room 516 Beijing Fortune Plaza Office TowerNo. 7 Dongsanhuan Zhong LuChaoyang District, Beijing, 100020ChinaPhone: + 86.10.6530.9368/69/70Fax: + [email protected]

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