A new comScore report says that 20 percent of all U.S.-based, browser-based business Internet traffic as of September 2011 came from AT&T (NYSE: T).
Not far behind Ma Bell were Verizon (NYSE: VZ) with a 12 percent share and CenturyLink (NYSE: CTL), which got a boost from its acquisition of Qwest in April, as the third largest ISP with a 7 percent share.
As a whole, the top five largest business ISPs drove almost 50 percent of the U.S. business Internet traffic.
Although the market is dominated by three top providers, Greg Mishkin, comScore vice president of telecom and wireless, is quick to point out that one of the unique attributes of the business market is that "even with smaller carriers contributing only a fraction of the traffic delivered by top carriers, the business ISP market is still more competitive than the residential ISP market."
Mishkin added that while AT&T and Verizon dominate the large business market, "The small business segment is even more competitive among ISPs, highlighting the need for providers to develop strong marketing strategies to ensure they can retain and grow market share."
Driven by the entrance of a number of CLECs and cable operators, the SMB market continues to be the most competitive business ISP market, with about 40 percent of traffic being driven by service providers that aren't in the top 10 carrier list.
And even though AT&T dominates the SMB market, its 13 percent market share is much lower than what it commands in the medium and large business segments. Comcast (Nasdaq: CMCSA) and Verizon were the second and third largest players with a respective 8 and 7 percent market share.
From a local market perspective, AT&T held the top position as of September 2011, while Verizon led three of the top 10 markets, including New York. In the SMB segment, Comcast and AT&T ranked as the top ISPs in four of the top 10 local markets, while Verizon and Cablevision (NYSE: CVC) both led in one local market.
What these numbers suggest is that as many SMBs near the end of their contracts with larger providers, they are increasingly looking at alternative players like regional CLECs or cable operators to get their service.
- see the release
AT&T U-verse, IP business services drove Q3 2011 wireline growth
Verizon's Q3 wireline story driven by consumer, business gains
CenturyLink Q3: Doubles operating revenues, increases broadband subscribers