BIoT Canada


The Canadian data/Internet market reached approximately $5.7 billion in revenue at the end of 2001, and is projecte...

March 12, 2002  

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The Canadian data/Internet market reached approximately $5.7 billion in revenue at the end of 2001, and is projected to reach about $7.8 billion by the end of 2003, according to a new report by the Convergence Consulting Group of Toronto.

The report, The Canadian Data Internet Market, March 2002 Edition, shows that this market saw a 17 per cent growth in 2001 and predicts it will continue to grow at a CAGR of 17 per cent both this year and next.

According to Convergence Consulting, this report draws on more than five years of collecting and assessing data, and includes information from hundreds of interviews with access providers and equipment makers. Some of the findings from this year’s report include:

 Data/Internet access sales to business, government and organizations comprise over half of the market, but access sales to the residential market have the most robust growth rates. Carrier sales (sales to ISPs, telcos, etc.) is the smallest revenue segment with the lowest rate of growth.

 2002-2003 residential data/Internet access revenue growth rates are forecast to be more than double non-residential data/Internet access revenue growth rates. On the residential side, high-speed access is the key driver, with over 60 per cent revenue growth in 2001.

 With the non-residential data/internet access market maturing, systems integration/ecommerce, hosting, management and security, along with content have become key differentiators and important revenue drivers to access providers.

 Bell/Partners (including Aliant, Manitoba Telecom Services and SaskTel), Telus and AT&T are the market leaders.

As far as specific segments are concerned, the report found the following:

 Private line remains the workhorse of carrier connectivity. Improvements to network infrastructure, new networks (utilities/municipalities), as well as alternatives (including DSL, LAN, etc.) will contribute to a lower rate of revenue growth for both corporate and carrier private line.

 Port growth, higher speeds and the ability to interconnect will continue to drive frame relay’s revenue growth, although it will see competition from the LAN and IPVPN segments.

 Despite revenue growth (propelled by large business and access providers’ need to consolidate multiple traffic types). ATM’s future share of the data/internet market will be limited by the rise of LAN.

 LAN is a strong competitor to ATM and frame relay due especially to demand by enterprises attracted to its speed, scalability and relatively low cost. New customers account for a significant share of LAN’s revenue growth.

 IPVPN is an emerging segment with high growth rates. Remote access and site-to-site IPVPNs will continue to drive this segment forward, challenging both ATM and frame relay.

 Legacy will continue to decline. Legacy’s losses will be compensated in part by other access segments’ revenue gains.

 Business DSL will continue to be a key driver of corporate data/internet access revenue growth, due to its strong account growth.

For more detailed information on this report, visit the company’s web site at

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