Telecommunications Industry Association: ICT Spending Up 5.7% to $1.45 Trillion

Business Ethernet, IoT among growth categories driving increase

The Telecommunications Industry Association says that U.S. information and communications technology (ITC) spending totaled $1.45 trillion in 2015. That was up 5.7% from 2014, which had seen a 5.3% increase over the year before.

That is the good news. The bad news is that the twentieth annual ICT Market Review & Forecast predicts declines in those growth rates over all ICT market segments over the next five years, though that is attributed to maturing tech and more targeted spending.

The report was unveiled at TIA's Network of the Future show in Dallas.

Helping drive the increase in 2015 were cloud computing, business Ethernet, and Internet of Things (IoT0, which were among the so-called "pacesetting markets," or ones with double-digits growth. Cable operators use Ethernet technology to deliver some business service, as well as an Ethernet-over-hybrid fiber coax (HFC) platform that some MSOs are using, and ISPs are well positioned as a gateway to IoT.

Not surprisingly given the move to IP, among the "legacy technologies and services" category—those with long-term declines—were circuit-switched landlines.

In total, the pacesetting markets were up 19.5% year-over-year.

As to the predicted declines in spending percentages, TIA CEO Scott Belcher said: “And while growth will continue almost across the board, it’s clear that the surge in ICT spending over the last decade is moving towards a more modest rate. This change is the result of maturing technologies, in which costs are lowered and companies are better able to target spending."

Smart phones contribute to that decline, something of a victim of their own success. "Between 2010 and 2015, U.S. smartphone spending increased three-fold, from $17.6 billion to $52.9 billion," the report points out. But now with penetration at almost two-thirds (68%), it predicts that spending will slow dramatically, from 8.3% annual growth in 2015 to only 1.2% in 2020.

Belcher sounded a warning note about the impact of government regs. "U.S. companies could face more dramatic spending growth declines if Washington continues to try and impose heavy handed rules, such the FCC’s internet regulation plan," he said in releasing the report. "Now more than ever, government leaders need to be forward-thinking and pursue policies that encourage private sector innovation and investment.”