Report Published: "United States Telecommunications Report Q2 2014"

New Fixed Networks market report from Business Monitor International: "United States Telecommunications Report Q2 2014"

[UKPRwire, Wed May 21 2014] The net neutrality debate is playing out in the US market with Comcast and Netflix reaching the first agreement regarding content traffic on a broadband operator's network. We believe there are still plenty of potential changes left to be tried by operators and the increasing number of over-the-top content providers in the market. This trend is informing the growing number of mergers and acquisitions taking place, as smaller players are swallowed up by the country's largest operators. The high costs of maintaining a network have directed operators towards M&A and we see little chance of small companies surviving in the long term.

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Key Data

There were 338.879mn mobile subscriptions in the US in 2013, with the final quarter of the year showing the slowest rate of growth in the year. Operators will concentrate on building up revenues rather than subscriber bases.

Fixed-line connections continue to fall as more households switch to mobile options for their voice needs. We forecast market decline to less than 25% penetration by 2018.

Key Trends & Developments

* Verizon Communications' legal case against the FCC's 2010 Open Internet rules was upheld by a US court in January 2014. The development was widely seen as a major blow for net neutrality in the US. The court's decision did acknowledge the FCC's right to request disclosure from operators over managing traffic on their networks and the court did not declare net neutrality an unlawful concept. It also did not prevent the FCC from regulating broadband providers under the appropriate regulations. BMI believes the debate on net neutrality will continue and major developments will start to take shape in 2014. * * Related to the net neutrality debate, online content streaming service Netflix and cable operator Comcast agreed a deal in late February 2014 to ensure faster and more reliable internet access for Netflix subscribers on Comcast's network. The deal will ensure a smooth streaming experience for users but will not give preferential treatment to Netflix. * * Comcast made a bid for Time Warner Cable in mid-February, creating a sector behemoth. The combined entity would have 33mn cable TV subscribers, far outstripping the remainder of the market. BMI thinks the FCC may back the Comcast-TWC deal as a way of reinforcing its arguments on net neutrality. When it acquired NBC Universal, Comcast agreed to abide by net neutrality rules and that agreement would have to be applied to TWC on completion of the

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