Telecommunications
Technically, telecommunications encompasses any communication over a
distance, be it via telephone, television, radio, wireless network,
computer network, telemetry, or other means—but traditionally, the term
referred to telephone service. These days, though, all these technologies
and others are converging—indeed, nowadays you can access the Internet,
play videos, or track your children's movements via global positioning
system (GPS) technology on your cell phone—so the lines between
telecommunications and other industries like computer hardware and consumer
electronics are getting blurrier all the time.
In other words: If you want to work in an industry that requires you to
learn fast and adapt quickly, this is it.
Telecommunications is a mammoth industry, comprising companies that make
hardware, produce software, and provide services. Hardware includes a vast
range of products that enable communication across the entire planet, from
video broadcasting satellites to telephone handsets to fiber-optic
transmission cables. Services include running the switches that control the
phone system, providing Internet access, and configuring private networks
by which international corporations conduct business. Software makes it all
work, from sending and receiving e-mail to relaying satellite data to
controlling telephone switching equipment to reducing background noise on
your cell phone call.
The breakup of AT&T in 1984 created the modern telecommunications
industry, subjecting phone companies to free-market forces for the first
time. The long-distance market became competitive almost immediately, but
the so-called Baby Bells fought a rear-guard action against letting
companies like AT&T (since acquired by SBC) or MCI (recently acquired
by Verizon) enter the local phone market. But the Telecommunications Act of
1996 deregulated local phone markets. Proponents say deregulation makes
telecommunications services more competitive, benefiting consumers. Critics
say it gives a few giant companies unchecked sway over our ability to
communicate with each other. Regardless, deregulation appears here to stay,
with the industry swept up in waves of consolidation that are likely to
continue.
Convergence Confusion
With each passing year, and each new generation of products introduced in
the marketplace, it's getting harder and harder to pigeonhole companies
and their products into traditional categories like telecommunications,
computer hardware, and consumer electronics. Consider cell phones: These
days, cell phone users can use their phones to do everything from take
digital photographs and send and receive email to surf the 'Net,
download and watch videos, and transmit their geographic location via
global positioning system (GPS) technology. You tell us: Should cell phones
that do all that be called consumer electronics products? Telecom products?
Computer hardware products?
One result of convergence is that players in the consumer electronics,
computer hardware, and telecom sectors are increasingly finding themselves
competing head-to-head to determine who will lead in brand-new product
categories such as wirelessly connected cell phones. Turmoil, in the form
of mergers and acquisitions and fluctuations in profitability, is likely to
result in each of these industries as time passes.
The Growth of Wireless
The wireless sector is growing like gangbusters. A Deloitte Research report
predicts that the number of wireless connections made in 2006 will be some
500,000,000 greater than the number made in 2005. The launch of dozens of
3G networks is leading to faster speeds, facilitating quicker downloads and
improved service. At the same time, wireless carriers are undergoing a wave
of consolidation: In recent times, Cingular acquired AT&T Wireless;
Sprint joined Nextel; and ALLTEL acquired Western Wireless.
VoIP
VoIP, or Voice over Internet Protocol, makes it possible to send phone
calls as data packets across the Internet and other IP networks (such as
private Local Area Networks, or IM-based VoIP like Skype and Yahoo! IM),
meaning phone calls no longer have to travel through local phone company
lines. Quality, consistency, and reliability of VoIP doesn’t equal that of
old-timey phone networks—but it’s getting there. And the price sure is
right: like emails, VoIP-to-VoIP phone calls are free—the only cost is the
cost of your broadband Internet connection, which is typically a relatively
small, fixed, up-front cost. There are currently some downsides to VoIP
offerings (while the phones usually continue to work even during power
outages, if your power goes out and you don’t have a generator, most VoIP
users will be unable to make VoIP phone calls—and most VoIP offerings do
not support encryption, so the security of VoIP phone calls can be
questionable), but use of VoIP is growing all the time.
Prior to the Telecommunications Act of 1996, a variety of regulations
divided telecommunications artificially—cable TV companies were prohibited
from offering local telephone service, video programming over phone lines
was banned, and local and long-distance service providers were forbidden
from competing in each other's markets. The Telecommunications Act
lifted these competitive restrictions. One remaining regulatory barrier
prohibits service providers from manufacturing telecommunications
equipment. The cleanest way to break this industry down, then, is between
those who make the software and hardware and those who provide various
services.
Service Providers
These companies provide local and long-distance wireline telephone service.
Industry insiders call this POTS, for plain old telephone service. Wireline
providers include the large long-distance service providers such as Verizon
and Sprint and the RBOCs (the Baby Bells) like SBC Communications and
BellSouth. A new generation of companies is laying fiber-optic wire
networks to handle the rapidly increasing data traffic, including Qwest,
Level 3, and Verizon.
Wireless Service Providers
Marked by carrier consolidation and partnering to augment geographic reach
and gain economies of scale, wireless communication services have shaken up
the telecom industry. They have also brought telecommunications to the far
corners of the earth, including parts of Africa and South America where
there's no existing wireline infrastructure, and have made local
markets far more competitive in the United States.
Satellite Telecommunication Services
Satellite telecom services break down into fixed satellite services such as
Intelsat; low earth orbit companies (LEOs), which include Globalstar and
mega-LEO Teledesic (controlled by Craig McCaw); direct broadcast satellite
companies such as DirecTV; and the global positioning system (GPS).
Satellite services include everything from navigation systems (such as
those being included in the dash of some new model vehicles) to video
broadcast and data transmission.
Internet Service Providers (ISPs)
These consist of those companies that make it possible for you to go
online—Microsoft, AOL, Earthlink, and the RBOCs. The Internet, which has
become an integral part of the telecommunications industry, is also the
vehicle by which a huge dose of talent and energy has been added to telecom
as voice and data networks converge.
Customer Premise Equipment (CPE) Manufacturers
Telecommunication service providers are the biggest customers of
telecommunications equipment makers. When they sell a service to a company,
for instance, they purchase the switch, which can serve anywhere from 15 to
100,000 people, as well as other customer premise equipment
(CPE)—everything from telephones to voice-mail systems to private branch
exchanges (PBXs). Local area networks (LAN) require their own routers,
switches, and hubs. The big players here include Lucent Technologies,
Nortel, Fujitsu, Siemens, and Alcatel.
Networking Equipment and Fiber Optics Manufacturers
Networking equipment includes the stuff that makes the local area network
operative, including routers, hubs, switches, and servers. Fiber optics
consists of the optical fiber and fiber-optic cable, transmitters,
receivers, and connectors that carry data and voice messages. The biggest
switch makers are Nortel and Lucent. Cisco and 3Com are among the biggest
makers of networking equipment.
Wireless and Satellite Communication Equipment
Manufacturers
These are different categories that we've grouped together. The
radio-based communications systems, the switches, transmission, and
subscriber equipment for this sector differ from those the wireline service
providers use. Large players in wireless equipment include Motorola,
Qualcomm, Sony, and NEC. Satellite communication equipment makers include
Comcast and Intelsat, as well as a number of cable companies, such as Cox
Communications, DirecTV, and the DISH Network.
According to the U.S. Bureau of Labor Statistics, "Employment in the
telecommunications industry is expected to decline 7 percent over the
2004-14 period, compared with 14 percent growth for all industries
combined."
In this varied field, demand for workers, or lack of it, will be based
mostly on technology. For example, as new voice recognition technology
improves productivity, jobs like telephone and directory assistance
operators will continue to decrease in number. But the need for engineers
who develop that technology will increase.
The outlook is good in telecom sectors that are bringing exciting new
technologies to market. High-speed data services, voice communications over
the Internet, and wireless networking are some of the sectors that will be
hiring, and small companies are good places to find jobs. Electrical and
electronics engineers, computer software engineers, systems analysts,
customer service professionals, and the likes will find opportunities
growing faster than overall for the industry as networks expand, providers
invest in R&D, and computer technology grows more sophisticated. Line
installers and repairers should also find work as businesses seek to
increase connections to suppliers and customers and residential customers
add broadband service.
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Reach Out and Touch Someone
In telecommunications, you're working with products that people know
and use. Everybody knows what voice mail, caller ID, and portable phones
are. One insider says, "It's stuff I identify with and my friends
identify with." As a consequence, your work more than reaches out and
touches someone—it touches a lot of people.
So Many Ways to Call
"The products are varied," says an insider. "It's
changing incredibly fast. That's not unique to telecom, but it's
certainly true of telecom." Wireless, speech recognition, Internet
telephony—the long list of new products driving change in this industry
will have a huge impact on our lives. If you can deal with the ambiguity
that comes with change and get a charge from the excitement that goes along
with all the new opportunities, then this is a great industry to work in.
New Directions
"Where does telecommunications end and the Internet start?" asks
an industry insider. Because the Internet has drawn a lot of talented,
innovative employees and workers, it has injected new life and energy into
telecommunications as well. This makes both new products and the work
environment particularly exciting, while bringing a variety of industries
together.
Old Bells
The monopolies that the Bells held for so long didn't exactly make
telecom a stimulating industry. New technology and deregulation have
changed this, but there's still a lot of holdover. The four remaining
Baby Bells still dominate local phone service. "Telecom was so
regulated for so long, you didn't have to be good to go far," say
an insider. "It was such an inbred industry." Join a newer
company if you want to avoid this aspect of the industry.
Red Tape
Historically, telecommunications has been one of the most regulated
industries. "One thing that's kind of a love-hate thing is the
regulatory environment," says an insider. "It impacts just about
every company in the industry. Some days I think it's an added
challenge to deal with the industry and also with this complexity. Some
days I wish it weren't there."
The Hugeness
The biggest players in telecom are huge. "That's not for
everybody," says an insider. In particular, the Bells and major
long-distance service providers are large, often bureaucratic organizations
where you'll need lots of people to sign off before you can get a
project approved. In contrast, there are a large number of smaller
companies, many of which have found niches or picked off share exactly
because of their mobility.
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Top 20 Major Players, by 2005 Revenue
|
|
Rank
|
Company
|
Revenue ($M)
|
1-Year Change (%)
|
Employees
|
|
1
|
Verizon
|
75,112
|
5.4
|
210,000
|
|
2
|
AT&T Inc.
|
43,862
|
7.5
|
162,000
|
|
3
|
Nokia
|
40,465
|
2.1
|
58,874
|
|
4
|
Motorola
|
36,843
|
17.6
|
69,000
|
|
5
|
Sprint Nextel Corp.
|
34,680
|
26.4
|
79,900
|
|
6
|
Cisco Systems, Inc.
|
24,801
|
12.5
|
38,413
|
|
7
|
BellSouth
|
20,547
|
1.2
|
63,000
|
|
8
|
Ericsson
|
19,100
|
–4.3
|
50,534
|
|
9
|
Cingular Wireless
|
19,436
|
25.5
|
70,300
|
|
10
|
Alcatel
|
16,614*
|
5.6*
|
55,718*
|
|
11
|
Qwest Communications International Inc.
|
13,903
|
0.7
|
41,000
|
|
12
|
Nortel Networks Corp.
|
9,828
|
–3.6
|
34,150
|
|
13
|
Alltel Corp.
|
9,487
|
15.0
|
21,373
|
|
14
|
L-3 Communications Holdings, Inc.
|
9,445
|
36.9
|
56,200
|
|
15
|
Lucent Technologies
|
9,441
|
4.4
|
30,500
|
|
16
|
T-Mobile USA, Inc.
|
9,366*
|
12.1*
|
22,616*
|
|
17
|
Qualcomm Inc.
|
5,673
|
16.3
|
7,600
|
|
18
|
Avaya Inc.
|
4,902
|
20.5
|
19,100
|
|
19
|
Telephone and Data Systems, Inc.
|
3,720
|
8.0
|
11,500
|
|
20
|
Level 3 Communications, Inc.
|
3,613
|
–2.7
|
4,800
|
*2004 numbers
Source: Fortune.com; Hoovers.com; WetFeet analysis.
|
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Engineer
Engineers of various types are in great demand in this industry. Although
the specifics of different assignments will vary (for example, field
engineers will install equipment at a customer site, and network engineers
will plan out network needs), most positions will require a degree in
computer science, electrical engineering, or system engineering, as well as
knowledge of Windows NT, C++, Unix, and other programming languages. Salary
range: $45,000 to $105,000.
Test Engineer
The test engineer makes sure the product works, especially the switches,
which are critical. If email or voicemail doesn't work, it is, after
all, considered an urgent issue. The test cycle is often as long as the
development cycle. Salary range: $45,000 to $100,000.
Software or Applications Engineer
These engineers concentrate on writing code. Most companies require code to
be written on Unix-based machines. Salary range: $45,000 to $100,500.
Product Manager
Essentially, product managers make the product happen. Product managers
determine what service or product they'll sell to the end user, then
help develop it, be it wireless service, DSL, caller ID, or voicemail. On
the manufacturing side, they need to understand the technology. This
position generally requires an MBA or similar experience with another
company, preferably in networking or data communications. Salary range:
$60,000 to $125,000.
Sales
Salespeople sell the product to the customer. They usually have a smaller
base salary and larger commission than their counterpart, the technical
sales rep or sales engineer, who often accompanies the sales rep in order
to answer the customer's technical questions. Salary range: $25,000 to
$100,000 or more, depending on commissions.
Customer Support Staff
Customer support answers customer phone calls or emails, helping to solve
problems. This includes everything from identifying problems to fixing
bugs. This is often a good place to start a career in telecom, particularly
if you lack an engineering background. Customer service managers earn at
the high end of the scale. Salary range: $30,000 to $50,000.
Public Relations and Government Relations
The role the government has played in regulating telecommunications has
resulted in a number of jobs within the major companies to work with the
government and press to enhance relations. These include lobbying
government officials, helping draft legislation, and working with the press
to garner favorable coverage for regulations your company supports. Salary
range: $50,000 to $150,000.
Here are a few things to think about before you start looking for a job in
telecommunications:
-
Keep your training in the industry up to date. In this rapidly changing
field, new training will be the key to getting that first job and
additional promotions.
-
If you want a job in telecom, your best bet is to study up on the
industry. There's a host of industry trade magazines covering a
variety of areas, and these will provide you with a sense for the
peculiar argot of the industry.
-
The bigger companies, such as SBC and BellSouth, recruit on college
campuses. Career fairs at your school are great places to make contacts.
-
Smaller companies typically look for people with experience in some
aspect of the industry. If you do have experience in the industry,
including such areas as networks or computer telephony, this will give
you a leg up in finding work.
-
Insiders in the industry say that your best route to finding a job is
networking. Although this is true in most industries, it's
particularly true for telecommunications. Companies talk to each other a
lot. If you know a few people in the industry, you can pretty easily get
additional contacts.
-
Be careful about going to work for a company that's a potential
takeover target. If there are lots of articles speculating that a company
is a buyout candidate, it's probably going to get bought out within
two years. If you work in corporate sales or another area where there
will be serious duplication—line installers, however, shouldn't
worry—you may want to think twice about accepting an offer.