US telecommunication service revenues are forecast to grow to $734 billion in 2021. Gains will be supported by increased service bundling activity, as consumers are motivated to purchase more options when individual services are offered at a discounted rate.
Telecommunication Resellers Competitive on Price
Resellers of telecommunication services provide fixed telephone connections or wireless phone and data service from major carriers that own the network infrastructure. Mobile virtual network operators (MVNOs) resell wireless services that are often available at lower cost than going directly through major providers such as Verizon and AT&T. Many resellers offer low-cost prepaid plans, in which a customer can add airtime or data when needed, as opposed to more profitable postpaid plans with a monthly invoice.
Although resold telecommunication services may not be as fast or reliable as those from the major networks (which prioritize their direct customers), the affordability of these prepaid plans has led to steep revenue growth for resellers. From 2006 to 2016, resellers represented the fastest growing telecommunications segment by revenue. This segment is expected to continue registering the fastest gains through the forecast period.
In a divisive political environment, telecommunications resellers are trying to appeal to consumers based on their political affiliation. Credo Mobile, which just launched an unlimited data plan, offers cell phone service on Verizon’s network while donating a portion of revenue to liberal nonprofit organizations such as Planned Parenthood and UltraViolet. The company was founded in 1985, but since 2014, it has found a new foil in Patriot Mobile, which donates portions of a customer’s bill to conservative organizations such as the National Rifle Association and American Family Association. The major telecommunications companies donate to both Republican and Democratic campaigns and a variety of organizations, but the partisan approach of political resellers may increasingly appeal to some consumers in the contentious climate surrounding the Trump administration.
Want to Learn More?
For in-depth analysis of trends in telecommunications, see Telecommunication Services: United States, a report published by the Freedonia Focus Reports division of The Freedonia Group.
This report contains historical data and analysis of telecommunication service revenues in US dollars from 2006-2016 with projections to 2021. Revenues are segmented by mode of service as follows:
- other services.
While you’re there, you can check out related reports such as Private Security Services: United States and Professional Services: United States.
About the Author
Cara Brosius is a Research Analyst with Freedonia Focus Reports. She holds a degree in economics, and her experience as an analyst covers multiple industries.