Media and Telecommunications Industry

Q3 2022: Mergers and Acquisitions Trend Report

Industry Overview

• The overall outlook for the Media and Telecommunications Industry is positive.
• The increase in demand for wireless data & voice services due to both 5G network expansion and growing smartphone sales is expected to boost net data traffic and overall industry revenues.
• Key industry players are Verizon Wireless, Deutsche telecom Ag, Dish Network, and United States Cellular.

Key Industry Trends

• Internet traffic volume reflects an increasing demand for internet access, resulting in higher rates of data usage and increased industry revenue.
• Corporations are earning greater profits, which allows them to invest in new telecommunications infrastructure.
• Higher disposable income encourages consumers to purchase devices such as tablet computers, potentially requiring additional dedicated cellular subscriptions.
• Growing demand for mobile internet access directly influences demand levels for wireless telecommunications.
• Broadband-enabled, internet-connected smartphones and tablets garner significantly more revenue from consumers than legacy voice and text messaging devices.

Recent M&A Transactions

Historical Performance

• The industry has experienced strong revenue growth and improved profits during the 2016-2021 period due to widespread infrastructure investments and advancements in data transference technology.
• Wireless connections are expected to reach 468.9 million by 2020, with 41.3% being data-only devices.

Future Industry Growth

• Industry growth has been strong due to a continuous investment trend in new technologies coupled with surging consumer demand.
• Industry value added (IVA), which measures an industry’s contribution to the overall economy, is expected to grow at an annualized 3.6% over the next ten years to 2027, compared to 1.8% annualized growth in US GDP over the same period.
• Inflationary pressures and tight credit is expected to weigh on spending. However, phones have become an essential good for many consumers, so industry revenue is expected to rise at a 2.3% annualized rate to $365.0 billion over the next five years.