Telecommunications update

Forecasts of growth for a troubled industrial sector

With an estimated combined value of €507 billion in 2003, Europe’s ICT technology markets are forecasting overall growth of over 4 per cent to the end of 2004, with the UK’s share expected to be a massive 4.5 per cent.

Network cabling, convergence

The new Category 6 standard copper cable, ratified in 2002, has been designed as a state-of the-art network solution comprising connecting hardware and end-to-end cabling components offering a wide variety of applications. It is estimated that 75 per cent of all new installations will be Category 6 cabling systems and, as with all technology improvements, ever-higher standards of installation and testing, as well as proper training, are required to prevent system failure.

It is likely that this is already creating an awakening of activity in key sectors, as well as greater clarity about performance standards. The high-profile projects that were put on hold as the market tightened its belt showed encouraging signs of activity by April 2003, with several significant projects nearing fruition.

Nevertheless, despite the technological advances surrounding Category 6 and Category 7 copper cabling, fibre for the backbone and copper to the desktop are likely to remain the network configuration of choice.

Many industry observers called 2003 the ‘Year of Convergence’. There has been a growth in the development of business strategies based on Internet Protocol (IP) technologies across a wide range of sectors including health, local and central government, and financial, as well as large national and smaller private companies.

Residential networks: the next revolution

An estimated 182,000 new houses will be built this year in the UK. Even if only 10 per cent of the potential network cabling infrastructure is carried out, the turnover would be over £27 million at an average installation cost of only £1,500 per house. A typical ‘full’ installation would include applications to cover telecommunications (voice, data, Internet and broadband), entertainment (TV networks (cable, satellite, terrestrial), audio systems), security (CCTV, alarms, intercom, door entry and lighting) and automation (controls for lighting, environmental and smart appliances ).

Connecting for education

With increasing government-led demand for improvements in IT literacy and skills, many projects involve the installation of computer labs and networks in schools, colleges and universities. Nor does it end when the installation is finished. For example, the company that won the contract to install cabling infrastructure in 19 schools in and around Glasgow was also awarded a 30-year maintenance contract.

Broadband revolution

By May 2003, the UK had two million broadband connections, with new connections running at a rate of 35,000 each week. Many broadband connections upgrade people from narrowband, as they recognise the benefits of fast, constant Internet access. Consumers in one of the most competitive broadband markets in Europe are benefiting from increased choice and lower prices. Over 100 Internet service providers (ISPs) now offer broadband services to consumers.

Security systems

The new Security Industry Authority has introduced a licensing scheme for all parts of the security industry that will raise standards and drive out the cowboys. Increased regulation will mean that more importance is attached to proper training, resulting in economic benefits down the line from better salaries, improved staff turnover and savings on recruitment.

The UK’s electronic security systems market, currently worth £1,343 million, is expected to rise by 2 to 3 per cent per year until 2007. Intruder alarms make up 47 per cent of the market, CCTV 17 per cent, central monitoring station services 21 per cent and access control 15 per cent. The industry is facing a severe shortage of skilled installers as current experts retire. It needs to attract young people, and to ensure that they and the young installers already in the business are properly trained.

Standards, qualifications and training

In April, e-skills UK – one of the first Sector Skills Councils to come into being – assumed responsibility for the IT, telecoms and contact centre sectors. It will work with employers to define the skills needs of over one and a half million IT and telecoms workers and over 500,000 people in contact centres. The products and services provided by all three sectors underpin the business processes of every organisation in the UK. e-skills UK is also responsibility for developing IT user skills in the entire workforce across all industries.

It has identified four key areas of work to improve skills and increase business competitiveness within the industry:

- promoting sector attractiveness to ensure the required quantity, quality and diversity of potential employees

- driving skills supply by encouraging and supporting UK educators and training systems in meeting the skills needs of the sector

- supporting workforce development to ensure the continual re-skilling of the existing workforce

- delivering market influence and providing strategic leadership for sector skills, based on market understanding.

Perhaps the tide is changing, and Service leavers should look again at the telecoms sector.