No matter what might be happening elsewhere in the global telecom business, U.S. service providers are doing better than their counterparts elsewhere. “2013 may bring more opportunities than challenges,” according to Craig Wigginton, Deloitte & Touche vice chairman.
As you might expect, mobile is the key. For an increasing number of people, mobile is no longer a “nice-to-have” service, but a necessity.
Higher speeds and widespread adoption of mobile also are expected to enable additional traction in vertical markets, especially in banking, mobile payments, automotive telematics and health care.
These incremental services will present new opportunities and drive even more demand for data.
The key challenges for telecom in the near term may be spectrum availability and the continued hearty capital requirements to build or upgrade networks.
“The projected increase in data usage will outpace the technological advances of 4G, driving toward a potential spectrum shortage in as early as a year or two,” Wigginton argues.
Some will disagree. Aside from new 4G capacity, consolidation in the mobile industry will allow for the more efficient use of existing spectrum. Additional spectrum also will be added by new repurposed mobile satellite spectrum, one way or the other.
Nor do U.S. consumers seem to have a lessened appetite for mobile devices, apps or services, even though some would argue there are signs of such a change in select European nations.
Economic uncertainty is not expected to be a significant factor for mobile in 2013. A few years ago, there was concern about whether the slow economy would push consumers to drop their mobile devices, but the trend has proven to be the opposite, Wigginton says.
The other good news is that service providers will not be capital challenged.
According to a Fitch Ratings report, large U.S. telecom and cable operator cash balances remained high during the fourth quarter of 2012, at approximately $49 billion, at least partly because firms are borrowing money due to low interest rates.
The increase in debt issuance resulted in leverage increasing year over year to 2.46 times revenue, from 2.42 times revenue previously.
Overall liquidity remains strong, as debt totaling $17.2 and $24.1 billion matures in 2013 and 2014, respectively, according to Fitch Ratings.
Edited by
Braden Becker 
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