WORLD TELECOMMUNICATIONS EXPENDITURE AND DEVELOPMENT 1987 TO 1995

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP92B00181R000300270040-5
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 21
• Document Creation Date: December 27, 2016
• Document Release Date: April 22, 2013
• Sequence Number: 40
• Content Type: MISC

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INTERNATIONAL
TELECOMMUNICATIONS
INTELLIGENCE
ITI Publications Ltd PO Boxl Chichester West Sussex P020 6X8 UK ? Tel [phone] Telex 869314 (Tecpub G) Fax [phone]
World Telecommunications
Expenditure and Development 1987 to 1995
Executive Summary
Insight into the world's telecommunications mazkets
Responding quickly to the needs of changing world telecommunications markets is essential to
strategic planning.
Market information and intelligence correctly used, can give companies a competitive advantage.
Since its first publication in 1986 ITI's world study "World Telecommunications Expenditure and
Development" has become the major research reference work for the industry.
In terms of sales it has become the telecommunications industry's "best seller".
The new study, which forecasts telecommunications spending in more than 50 countries up to
1995, is ready now.
In addition to the already successful features of last year's study, the 1987 edition carries many
more.
The study identifies the top 50 markets for telecommunications equipment by value and
breakdowns by product area.
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Each of the markets has a full narrative detailing developments and PTT changes, including de-
regulation and privatisation.
A_majorsection is devoted to market acce~
Greater analysis is given to world telephone density.
There is a complete new section on demographics in more than 120 telecommunications markets -
it is necessary to know the psychology of a market as well as its size in order to market to it
successfully.
The network data section has been expanded with, in most cases, comparative data over four
yeazs.
World aid is covered in greater detail with spending projections up to 1990.
A major directory of PTTs and telecommunications ministries is included in the study.
The study clearly identifies the growth mazkets and enables manufacturers to position their own
products critically within the markets.
xvor~ateiecoms spenamg
]986 & :forecast 1987.; & ;19.88'
~ so ~
(US$ bthons) ,
World. telecommunications equipment- spending in 1986
was US$100.2 billion which is forecast to increase to
US$108.6 billion in 1987 and US$121.6 billion in 1988.
World equipment spending in 1990 is expected to reach
US$156.8 billion with further growth to US$243.3 billion
in 1995.
By the year 2000 the study forecasts world
telecommunications equipment spending will reach
US$360.8 billion.
Speriding patterns will change over the next 15 years with developing countries taking a larger
share of the spending as their networks expand.
.The 50 top spending countries reviewed in the study, mostly developed countries, are forecast to
spend 79 per cent of the world's total telecommunications equipment expenditure in 1987 with the
remaining 100-plus countries spending 21 per cent.
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By the year 2000 the developing countries are forecast to have 57 per cent of the market within the
remaining 43 per cent.
ussia, w~iicli ieplaced Japan as tie -secondlargest telecommunications equipment spending
market in 1985 is expected to increase spending dramatically:
Russia -total estimated telecommunications equipment spending
1987
1988
1990
1995
US$9.6 billion
US$10.9 billion
US$13.4 billion
US$23.6 billion. .
By the turn of the century Russia is expected to equal the spending of the United States which was
US$24 billion in 1986 and is forecast to grow to US$27 billion in 1990.
The study includes a complete section on forecast spending by Product Sectors.
The top 50 markets for cable are expected to increase spending from US$6.4 billion in 1986 to
US$13.8 billion iri 1995.
Transmission equipment accounted for US$6.4 billion spending in the top 50 countries in 1986
and this is forecast to rise to US$13.8 billion in 1995.
Total spending by the world's top 50 markets on local and
toll switching was US$19.3 billion in 1986 and this is
forecast to grow to US$31.2 billion in 1995.
Other product areas covered by the study are microwave
transmission, satellite earth stations, data communications,
customer premises equipment, and mobile, cellular and
paging equipment.
The study has a major section which shows Japan's share
dropped from 27.1 per cent in 1985 to 25.6 per cent in
1986.
'Total spending by world`s
top SO markets on switching
1986 & forecast>1995
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_.... _ _ .
--
Swederi's~~share also dropped from 12.7 per cent in 1985
to 12.2 per cent in 1986.
.The United States, however, increased its share from 11.8
~_~per?cent-irr-i-98~5-tti~ 12:5~n~'Y98~
"World Telecommunications Expenditure and
Development 1987 to 1995" is published by International
Telecommunications Intelligence (Publications) Ltd. Price
?495 (UK and Europe) US$895 AIRMAIL -. (USA and
the Rest of the World). Published 1st November, 1987
Format: A4 Pages 550 -plus.
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11 ~ ~ II
To: ITI Publications Ltd
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United Kingdom
Please supply
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World Telecommunications Expenditure and Development
1987 to 1995
Price: ?495 (UK and Europe)
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CONTENTS
All information contained in this issue
has been obtained from numerous
sources we believe to be reliable,
but which we cannot guarantee.
Opinions expressed are based on our
interpretation of available information,
which is subject to change.
The ONLY weekly service analysing
world telecommunications
expenditure and development
Continued on Page Two
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WORLD REPORT
Russia will dominate the world telecommunications sales
market by 1990 becoming the country that every company
wants to break into.
The sales potential is huge. Revised forecasts forthe year 1990
predict that Western companies will be selling US$350 million
`,worth of equipment to the Russians.
In 1985 Russia displaced Japan as the second largest
spending market. Projections for the next three years show a
sharp upsurge in expenditure.
In 1984 Russia did not even figure in the top ten spending
countries in the world. In 1985 it was spending US$7.2 billion a
year on telecommunications equipment.
Last yearthe figure rose to US$8.4 billion and this year Russia
is budgeted to spend US$9.8 billion.
By 1990 the expenditure is forecast to be running at US$13.4
billion.
However, while the Russian market will grow rapidly, the United
States sales market will remain at a virtual standstill.
Although still the world's biggest spending country, expenditure
will rise to US$27.19 billion - a fairly small increase compared
to the 1986 figure of US$24 billion and this year's budget of
US$24.31 billion.
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WORLD REPORT
Russla,=: telec'ommunacatlonsi
equipment market (U$$ billions
Marketing managers would be well advised to start looking at the
Russian market immediately.
Russian imports of telecommunications equipment are expected to
reach US$5 billion in 1990 with the West accounting for US$350
million.
This compares with imports of 1984 of only US$924 million of which the
West supplied a mere US$37 million.
The COCOM agreement bans certain telecommunications exports to
Russia and other Eastern bloc countries.
However, this is likely to be amended in September 1988, amove -
which could literally open the floodgates.
The Russian network is typified by old, outdated equipment, corded
rotary telephones and poor reliability.
The West's expertise and technical know-how would be welcomed in
a country which has made telecommunications apriority area.
Afghanistan's infant telecommunications sector is planning further
expansion.
': Afghanistan telephone growth
in'Kabul
The country has just announced its 1986-1990 Five Year Plan
although full details of the expansion programme are not known.
Since 1978, Afghanistan's government has increased the number of
telephones installed in Kabul, the capital, from 13,200 to 22,000.
However, communications facilities in rural areas are far sparser. The
number of telephone sets currently -number 6,600 compared with
about 4,500 in 1978.
Although full details of the plan are not revealed, a report issued by the
country's official news agency Bakhtar said ,that before 1978,
automatic telecommunications facilities were only installed in Kabul,
Balkh, Herat and Kandahar provinces.
Since then the government has extended automatic facilities to
Parwan, Jowzjan, Konduz and Nangarhar provinces as well as Pol-e_~
""FCffis~'Sri City :............._._.. ~_.~____~--_
Plans call for automatic telephone equipment to be installed in Ghazni
province shortly.
Telecommunications growth has so far been slow.
The numberof main lines only increased from 22,200 in 1976 to 25,800
in 1980, the last year for which figures are available.
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..4 ?~ iS.L Y V V ~~J~1~-~ 1V1~~1~.L 1 ~
~~~
~~~~
~
Europe
~ North America
t
F
E
? ? ? ?
ar
as
? Russia
r.......,.. Africa
^ ~ ^ .Middle East
~- - __
~~
_~~ ?
Ate'
~~~h
Source: International Telecommunications Intelligence
4.1 . W.QRLD OVERVIEW
Market growth
According to International Telecommunications Intelligence, a
United Kingdom based research organisation, world spending
on telecommunications equipment reached a record $US90
OOOm in 1985. In the next five years, the fast growth is expected
to continue. reaching a world market of $US156 800m in real
terms in 1990 and a forecast $US202 700m in 1995.
World expenditure is broken down as follows.
development, is forecast to grow from $US2400m in 1985 to
?--$US11 400m in.loo~nd.S.LiS.1~ ~nOm.,ia1995...~,,_?_
The USSR's huge telecommunications expansion plan to install
another 10 million telephones by 1990 will mean a projected in-
crease in expenditure from $US7200m in 1985 to $US18 600m in
-1990 and $US21 ~OOm iri 1995.
Slower growth is forecast in Middle East markets which accoun-
ted for $US4200m expenditure in 1985. This is expected to rise
to only $US6700m in 1990 and $US8900m in 1995. (Figure 6).
Many of the world markets will level off after 1995 as much of
the major change to digital switching and fibre optic transmis-
sion will be completed. The developing countries are then ex-
pected to come into their own as major world markets with
Africa, Asia and South and Central America showing significant
growth.
Product shares in world sales of telecommunications equipment
^ In 19S~, North America's spending was $US28 200m out of a
world market of $US90 OOOm and this is forecast to grow to
$US34 600m in 1990 out of a world market of $US156 800m.
Further growth is expected to 1995 when the share will be
$US38 700m out of a world market of $US202 700m.
^ Europe will grow from a 198 total of $US27 300m to $US38
300m in 1990 and $US43 SOOm in 199.
^ The Far East, including Japan and China, is expected to grow
from $US13 SOOm in 1985 to $US21 400m in 1990 and $US30
400m in 199. This growth is fuelled by China's $US30 OOOm
telecommunications development program.
^ Africa, for long lasging behind in telecommunications
in 198 were (Figure 8):
^ switching 31.E per cent;
^ transmission 30.9 per cent;
^ terminal equipment 14 per cent;
^ mobile radios 9.6 per cent;
^ private systems 8.4 per cent; and
^ other equipment 5.6 per cent.
WORLD SPENDING ON COMMUN,ICATIONSEQUlPMENT
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` ~"-`~TUP?20~VOA'LU"T'EZECZ)1171IVIUNICATION5~IiAR1 ti 4t~. S '1rr ~ p t : $ r r, ?fa l .y 1 : ! ? rr y' {? . ~ rb~ rh li ' t~t~'~' ty .1,''
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Urtited Kingdom r.74 r,~;i::::,~~ n~ hnr: w;tihnxir3lcuroA78:
t , ' ?, :Graph -Total mark for telecommunications equipment ir,aa},t st(f ;
"" '" 1985 andforec t 1986?1987, 1990,nc,.nisi,,,?,a~.7,~;~+stc~t -,iry;:,D 78,
`~,OperatingSwctttre 02;1 ,CBPt ,dhQt t;rzno?'^n, i:ppf 79:
' f; Market Competition ~r rssw? gn itstsyc 79
~~ Breakdown of ezpenditu byproduct sector forecast 1986 and 1990,;xin,~,7 ;.;;,;,,1, 81?
f,Graph-Growth ofezpen, iwreby,selectedproduct;sector. forecast.~,ir.slonv.nhJr.;,?'
1986 and 1990,? -~ r ,,.a nt,t>.;tq i ;!'~ ~ ur, n r .c?, b; r, 81
China ~ ,...,.,.; r. ~ 1'"'' ? ??
~ ?' 1985 and forecast 1986, 1987, 1990 t` ~ ~% is ?i 141 ,
PTTStrucwre _ t,;3~:?~,up?: 'o',ir,~u;Tin?lye :,;! tr?,',::c !,-: c i - d-;r.rJ 142
'MarketCompeuuorf?.`" .x!=01 .Cr~.~ ?sg,,,: t::-~,;o: ham,, %?,~f 142
ni-Breakdown of expendittue by product sector forecast 1986 and 1990'~t''~Z !;e^ ~r~'!`143
YrGraph -Growth of expendiwre by selected product sector forecasCsirs~gm:?7 ?sf:c'd
r'"~ ' 1986 and 1990' 4nc dBPI s.r~:ro! m;-_.~ taa'_.,:1 ; ? 3 , ~ylxyl~ r,rs5!s~::143
- ..7;ri11r,Le? +JUGJ(' G,;: ?' 7. !I, 9j,` ;J'~ '^.:J !!Sra t7'
~w , ~ ' ~... - ;~. r .;~ , i r - ti,- r~ ti'T'.l'-"r"y7's '~kfrt-"~r'?;}g r~ ._~ri ,?~,.,a577t
F: ' r-' r !l~I;~j! f~,~:^ ?i's j ~~ d'~~-`,~_,; ti~? Zt 1. i .7 l~??..S'?>?~ i ti f itlr !{' + ~~ tai ~' ~ ~ t
1 ., ~ ,r. ~,. , . s , ,r_,urTCa,.._ '.f;~r . y .1, r:'~ ,.-r.;;:,,i,.,t;,?~:,~,.cr~?t 117
Market Competition . y??.;?.~ , .., ,, r'r.v,,:"; -ir: ;':117
t C ?Breakdown of expendiwrd by product sector forecast 1986 and 1990. ; ;:~ ;;.;: ' 118
fit; ,Graph -Growth of expenditure by selected prtsduct sector forecast s;lr -+ ~.4
r;; t' 1986 and 1990 :
Austria
~; rMarket prospect
~'?: { !:ue