Higher Energy Costs Will Push Telecom Operators to Raise Prices, Lifting Global Services Revenue to $1.585 Trillion in 2026, According to IDC 

Tariff increases will lift nominal revenues, while direct-to-device satellite partnerships emerge as the next growth opportunity for operators. 

BOSTON, Mass. (November 5, 2026) – Worldwide spending on telecommunication and pay TV services will reach $1,585 billion in 2026, showing an increase of +2.3% year-on-year, according to IDC Research’s (IDC) Worldwide Semiannual Telecom Services Tracker. The latest forecast is slightly more optimistic compared to the forecast published earlier this year, as it assumes a 0.5 percentage point higher growth in the total market value.  

Accelerating inflation is the main force behind this forecast. Energy prices are expected to remain elevated for some time as the conflicts in the Middle East and Ukraine continue, pushing up telecom operators’ costs. To protect their margins, operators will likely raise tariffs. Because operators in most countries need regulatory approval before changing prices, the benefit to market growth will be spread across the remainder of 2026 and 2027. 

However, inflation is not a source of genuine growth for the market, as the boost it provides is purely nominal. Historical growth rates have consistently fallen short of the annual inflation rates reported in official statistics for the same years, indicating that the market is contracting in real terms.

The outlook will vary considerably by geography. The scenario described above is most likely in Europe and North America. Higher purchasing power in these regions means lower price elasticity. Fewer customers will be ready to switch to more affordable packages or give up services they consider non-essential. The situation will be different in Africa and parts of Asia Pacific, where purchasing power is limited. Price increases are likely to prompt customers to move to cheaper plans or lower-cost operators. As a result, nominal revenue growth will lag well behind headline tariff rises. Under IDC’s taxonomy, Africa is part of the wider EMEA region, where Europe dominates spending, so the weak growth expected in Africa will be masked by the relatively high growth rate reported for EMEA as a whole.

An analysis of the connectivity market by type of service confirms that established trends will continue, despite changes to the top-line forecasts. Mobile will remain the largest segment. Growth in mobile data usage and M2M applications will more than offset declining spending on mobile voice and messaging. Spending on fixed voice will fall over the forecast period. Revenues from legacy TDM voice are declining rapidly, and growth in IP voice will not be enough to compensate. The traditional pay TV market will also decline, due to growing popularity of Video on demand (VoD) and over-the-top (OTT) services. Fixed data services will expand, due to ever-growing demand for higher-bandwidth connections.

Growth in the fixed data segment will also be supported by the rising popularity of LEO satellite broadband. However, the impact of this technology will remain limited, for two reasons. First, LEO broadband will remain concentrated among a few players, including Starlink and Amazon Leo. Second, these providers will focus on rural and remote households, maritime and aviation customers, and enterprises and governments that need resilient backup links.

In recent years, another type of satellite connectivity service has emerged. It follows a different model and offers far higher growth potential. Direct-to-device (D2D) services include direct-to-cell (D2C) and satellite IoT, among others. They are built on partnerships between satellite and mobile operators. These partnerships allow operators to use satellite coverage to differentiate their offers and extend coverage to areas their networks do not reach. This is what sets D2D apart. In LEO broadband, telecom operators are largely bystanders. In D2D, they take part directly, as the owners of the customer relationship.

“The future of connectivity will not be defined by the choice between the ground and the sky, but by how seamlessly the two work together,” said Kresimir Alic, research director, Worldwide Telecom Services at IDC. “Operators that treat satellites as an extension of their networks, rather than a rival to them, will be better placed to improve customer loyalty, protect revenues, and connect the next billion users.” 

About IDC 

IDC Research (IDC) is the technology intelligence layer of the AI economy. A global leader in research and data for more than 60 years, IDC’s expert analysts, proprietary datasets, and rigorous methodologies are trusted by business and IT leaders to guide critical business strategies and IT investments. Today, that intelligence is built into the tools and workflows where work gets done with IDC Quanta, making work sharper, teams faster, and businesses harder to beat. 

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