Security Driving Telecommunications Growth
In the report, “Federal Telecommunications MarketView,” INPUT predicts homeland security, e-government, force transformation in the Department of Defense, and telecommuting will continue to drive the market. “Telecommunications stands out as one of the main technology segments that is seeing increases in near term spending due to homeland security initiatives,” said Chris Campbell, senior analyst, federal market analysis at INPUT. “Telecommunications will support information sharing goals between agencies as well as communications between federal agencies and first responders at the state and local government level.” Federal spending on telecommunications represents approximately 26% of the total federal IT spending in FY2004.
Growth in telecommunications spending in the Department of Defense (including the three uniformed services) and the Department of Homeland Security can be tied directly to defense transformation and homeland security initiatives. INPUT expects telecommunications spending at the Department of Homeland Security to increase by 50 percent, from more than $US800 million in FY2004 to $US1.2 billion in FY 2009.
“Telecommunications is critical to the Department of Defense’s force transformation as it provides the infrastructure for network-centric warfare allowing for more efficient and effective coordination of joint forces and real-time intelligence updates,” explained Campbell. He added, “As wireless technologies become more secure, support higher data transmission speeds, and offer greater coverage they will also become a more integral part of every agency’s mission performance.” INPUT estimates that wireless spending will contribute to the telecommunications increase, growing at a compound annual growth rate of 12.5 percent, from $US1.4 billion in FY2004 to $US2.5 billion in FY2009.