Government telecom market growing, wireless fastest of all

Wireless voice and data services are going to become an ever-larger portion of the government telecommunications market over the next several years, according to a new study by Frost & Sullivan Inc.

The government telecom market ? including federal, state and local ? is expected to grow to $20.9 billion in 2005, from $15.2 billion in 2002, a compound annual growth rate of 11.32 percent.

Over that same period, wireless voice and data is expected to grow from 14.1 percent of telecom revenue to 23 percent, or roughly $4.8 billion.

"Price erosion is a major factor in wire line services [and] the revenue potential is a little more flat," said Stephanie Atkinson, the industry analyst who authored the study for the Mountain View, Calif. research and consulting company. "There's a little more [product] differentiation in wire line data and wireless voice and data offerings."

Atkinson said growth in the government telecom market is going to be on the enterprise side. "Products and solutions that hone in on security, business continuity, reliability and disaster recovery planning are presenting high growth due to the recent terrorist attacks and the need to improve communications and security," she wrote in the report.

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