Utilities Telecom Council: Utility telecom spending could reach $3.2B in 2011

As U.S.-based utilities move ahead with their smart grid plans they will spend more of their capital dollars on telecom equipment and services throughout 2011, a new study by the Utilities Telecom Council (UTC) reported.

The UTC study, "Utilities Telecom Spending Market Forecast," revealed that utilities could spend about $3.2 billion on their communications needs this year, a 21 percent increase over the $2.64 billion on utilities spent in 2009 and at least a 3 percent rise over the $3.1 billion spent in 2010.

Two of the biggest line items in utilities telecom spending patterns will be two-way metering and networking and transport networks.

Spending on services and equipment for two-way metering and associated networking represents about 32 percent or about $1 billion of the total utility telecom spending in 2011. Not far behind two-way metering is transport networks, with utilities expected to spend around $813 million on fiber, microwave, WiMAX and other forms of transport technology this year.

"The vast majority of utilities perform their own telecom operations, particularly now as smart grid technologies fuel the modernization of the nation's energy grid," Connie Durcsak, president and CEO of UTC, said in a news release.

While most utilities have traditionally run their own internal telecom networks, there are still opportunities for service providers to participate, as seen with actions taken by AT&T (NYSE: T), Sprint (NYSE: S) and Verizon (NYSE: VZ) to develop in-house wireline and wireless products that tailor to this industry segment.

For more:
- see the release
- and the UTC report

Related articles:
UTC President and CEO Bill Moroney to retire this year
Telcos, utilities look for harmony: TIA 2011 Preview
UTC study lays out utility industry's telecom requirements
Utilities, telcos look for common ground

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