What Kind of Industry Is Telecommunications? How It Builds and Connects the Networks Behind San Jose, CA
Telecommunications is part of the information industry. It covers the companies that transmit voice, data and video over wired, wireless and satellite networks, along with the businesses that make the equipment, build the infrastructure and install the cabling those networks run on.
It’s a broad field, from national phone and internet carriers to the local crews who wire individual offices. A Telecommunications Contractor in San Jose, CA works at the building level of that field. This guide explains how the industry is classified, the main segments within it and how the pieces connect.
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In the North American Industry Classification System (NAICS), which U.S. agencies use to group businesses, telecommunications service providers fall under subsector 517, Telecommunications, within Sector 51, Information. That includes wired and wireless carriers, satellite operators and companies that resell telecom services.
Investors use a different system. Under the Global Industry Classification Standard (GICS), telecommunication services sit within the Communication Services sector, alongside media and entertainment companies.
The companies that physically build and install networks are classified elsewhere. Firms that construct communication lines, towers and conduit fall under construction (NAICS 237130), and contractors that install telecommunications wiring inside buildings are grouped with wiring installation contractors (NAICS 238210). So the telecommunications industry, in practice, spans the information, manufacturing and construction sectors.
Main Segments of the Telecommunications Industry
Most companies in the field fit into one of these segments.
- Wired carriers: phone, cable and fiber internet providers
- Wireless carriers: mobile phone and data networks
- Satellite providers: satellite internet, TV and communications
- Equipment manufacturers: makers of switches, routers, radios, phones and fiber hardware
- Infrastructure builders: telecommunications construction companies that build towers, conduit and fiber routes
- Data centers and interconnection: facilities where networks meet and exchange traffic
- Installation contractors: licensed telecommunications contractors who cable and connect buildings
- Software and managed services: cloud phone systems, network management and IT providers
Telecommunications Industry at a Glance
Each segment plays a different role in getting a call or a data packet from one place to another.
| Segment | What it does | Classification | Typical customers |
|---|---|---|---|
| Carriers and service providers | Sell phone, internet and wireless service | NAICS 517, Information sector | Homes and businesses |
| Equipment manufacturers | Design and build network hardware | Manufacturing sector | Carriers, data centers, enterprises |
| Telecommunications construction | Build towers, conduit, poles and fiber routes | NAICS 237130, Construction sector | Carriers, utilities, developers |
| Telecommunications contractors | Install and test cabling and devices inside buildings | NAICS 238210, Construction sector | Businesses, schools, building owners |
| Data centers | House servers and connect networks | Information sector | Cloud providers, enterprises, carriers |
How the Telecommunications Industry Is Regulated
Telecommunications is a regulated industry. At the federal level, the Federal Communications Commission (FCC) regulates interstate and international communications by radio, television, wire, satellite and cable, including wireless spectrum. In California, the California Public Utilities Commission (CPUC) oversees intrastate telecommunications services and sets rules for utility poles and underground lines.
Contractors working in buildings are regulated differently. In California they’re licensed by the Contractors State License Board, and their installations must follow the California Electrical Code along with industry cabling standards from TIA.
The Telecommunications Industry Around San Jose
Silicon Valley is home to nearly every segment of the industry, often within a few miles of each other.
North San Jose
Networking equipment makers
San Jose is headquarters to major networking equipment companies, including Cisco, whose switches and routers run networks worldwide.
Santa Clara & south San Jose
Data centers
The South Bay has one of the largest concentrations of data centers in the country, connected by dense fiber routes.
City streets and neighborhoods
Carrier and fiber networks
Carriers keep adding fiber and small cells across the city to meet demand for faster home and mobile service.
Offices, schools and warehouses
Building networks
Every business, campus and warehouse relies on cabling, Wi-Fi and phone systems installed by local contractors.
Where Telecommunications Contractors Fit in the Industry
Carriers deliver service to the building, and equipment makers supply the hardware. Telecommunications contractors are the ones who connect it all inside: they install and test the cabling, build the telecom rooms and connect Wi-Fi, phones, cameras and AV systems. Our guide What Does a Telecommunications Contractor Do walks through that work from site survey to ongoing support.
Telecommunications as an Industry
Telecommunications is an information-sector industry, but it depends on manufacturers, builders and contractors to work. Carriers sell the service, equipment makers build the hardware, construction companies lay the routes and contractors connect each building, so a single phone call or video meeting relies on all of them.
You’ll often see the industry shortened to “telco” or “telecom,” and the two terms don’t mean quite the same thing. Our guide What Is the Difference Between Telco and Telecom explains how each term is used.
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