Download - Module 9
Analyzing the ICT Market : Technology and Trends and the Impact of Technology on the Market
Carlo M. Rossotto, Tim KellyCairo, March 10, 2009
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Technology Trends and the ICT Market
Main Technology Trends Affecting the ICT Sector
Broadband Wireless Technologies Convergence Handsets Digital Content
How technology is affecting the ICT industry
Revenues and Industry Structure Business Model Firm Specialization Product Differentiation
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Technology Trends and the ICT Market
Main Technology Trends Affecting the ICT Sector
BroadbandWireless TechnologiesConvergenceHandsetsDigital Content
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Main Technology Trends in ICT
Source: Pyramid Research.
Broadband Technologies I : Throughput and Range
0
20
40
60
80
100
120
ADSL ADSL 2+ WiFi WiMax VDSL
Peak Throughput(Download), (Mbps)
Range (Km)
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Main Technology Trends in ICT
Source: Pyramid Research. Note: shared throughput
Broadband Technologies II : Throughput and Range
0
500
1000
1500
2000
2500
3000
FTTP (BPON-ATM) FTTP (BPON-Ethernet)
FTTP (GPON-Ethernet/GEM)
FTTP (GPON-Ethernet/ATM)
Mb
ps
0
5
10
15
20
25
Km
Peak Throughput(Download), (Mbps)
Range (Km)
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Technology Trends and the ICT Market
Wireless Technologies: main trends
• Trend 1. Growth of 3G+3G+ users to increase at a 38% CAGR from 2008 to 2013 and to
account for 46% of all 5.9Bn mobile subscriptions in 2013 (Pyramid Research)
• Trend 2. Fixed wireless for development31 African countries have deployed CDMA2000 1X Networks (ITU)833,000 customers of W-CDMA in Africa (GSM Association)
• Trend 3. Wireless broadband for developmentEVDO growth in Africa
Source: ITU
Country Operator Download Speed Monthly Subscription (US$)Nigeria Starcomms 300-600 kbps 124Rwanda Rwandatel 400-700 kbps 62Morocco Wana 128-1000 kbps 24Sudan Canar Up to 2 Mbps 29Angola Movicel Up to 1 Mbps 257
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Technology Trends and the ICT Market
Convergence
• Convergence across technologies: multiple platforms are consolidating into a single IP-based platform, allowing voice, data and video consumption. The same digital content can be accessed and delivered across multiple platforms.
• Convergence across services: bundles of services, double-play and triple-play (Orange, for example, reported that 11% of its ADSL subscribers were also triple-play subscribers in 2007, up from 2.7% in 2005, Pyramid Research).
• Convergence across devices: Multiservice connectivity on a single end-user device. Dual-mode (WLAN-mobile) handsets and 3G-embedded computing devices has expanded over the past two years.
Operators still look at the bottom line whenthey consider diversify across technologies and services
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Technology Trends and the ICT Market
Broadband-enabled devices
Dual-mode (WLAN-mobile) Devices
PCs with embedded 3G capabilities (50% of laptops by 2010; Pyramid Research)
iPhone and Blackberry
Smartphone unit sales globally to grow at a CAGR of 17%, or nearly three times as fast as the total handset market, to reach 313m in 2013. Smartphones from 8% of total handsets in 2008 to 18% of total handsets in 2013 (Pyramid Research)
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Technology Trends and the ICT Market
Digital contentComputer and video games1 Film and video2 Music3 Advertising4
Global revenues (offline + online) USD 37.5 billion USD 84 billion USD 30 billion USD 445 billion
Growth of market (offline + online) 19% (2006-07) 4% (2006-07) -6% (2006-07) 5% (2006-07)
USD 6.5 billion
Increasingly all new games are Internet-enabled
Growth of online market 28% (2006-07) >100% (2006-07) 27% (2006-2007) 28% (2006-07)
Marginal
(under 1% in most markets)
Low for Internet-enabled games but growing quickly
(i.e. ”server piracy”)
Share of online in total 17% but increasingly all new games are Internet-enabled
16% 7.50%
Global online revenues Marginal USD 4.7 billion USD 31 billion
Unauthorised downloading of online content and its impact
Medium and growing High n.a.
Source: OECD 2007
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Technology Trends and the ICT Market
Digital content and Internet trafficGlobal consumer Internet traffic 2005-11 in million
terabytes/month
Source: OECD 2007
0
0.5
1
1.5
2
2.5
3
3.5
2005 2007 2009 2011
P2P
Internet video (PC, TV,communication)Web, Emai l , FTP
Onl ine games
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Technology Trends and the ICT Market
Digital Content and User Created Content
BlogsWikisPhoto-sharingPodcastingSocial Network SitesVirtual WorldsFile-Sharing P2P
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How Technology is affecting the Industry
Revenues and Industry Structure: A fast-changing picture
• PSTN revenues sharply down. less in global PSTN revenue down $103bn in 2013 than in 2008 (Pyramid)
• Mobile subscriber growth rates decelerating in most regions, with penetration rates hovering around the 80-120% range (CAGR of 8% for mobile subscriptions in 2008-2013) (Pyramid)
• Fixed and mobile broadband lines to increase threefold between 2008 and 2013, from 964m to 3.3bn (Pyramid)
• Internet access will generate nearly 55% of total fixed revenue in 2013.• Mobile data to grow at a 16% CAGR from 2008 to 2013, making up 34% of
global mobile revenue in 2013. • Revenue per fixed broadband line, currently at an average of $33, are to decline
(CAGR of -5%). FTTx has highest ARPS — 2X cable or DSL in 2008
Source: Pyramid Research
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Revenues and Industry Structure: A fast-changing picture
• Egypt is the seventh fastest growing broadband market in the world, with over 30% compounded growth rate
• Ten fastest growing broadband markets are in Asia, MNA, Latin America and Africa
• Operators boasting the highest data ARPS are those with the highest percentage of subscribers using 3G-enabled devices.
• Messaging revenues (email, SMS and MMS) were 58% of mobile data revenues in 2008 (projected 44% in 2013)
• Web access was 21% of mobile data revenues in 2008 (projected 28% in 2013)
• The rest is applications : music (high growth rate), games, graphic, ringtones…
• Source: Pyramid Research
Data Revenues as a % of total mobile revenues
0 5 10 15 20 25 30 35
2007
2008
2009
2010
2011
2012
2013
How Technology is affecting the Industry
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Digital content development and on-line business models
–Advertisement (e.g. 99% of Google revenues)–Voluntary donations (e.g. blogs)–Pay-per-view and pay-per-item (e.g. IPTV model)–Licensing content to third parties–Online sales (e.g. portals Amazon, eBay)–Sale of user data, clickstream analysis
How Technology is affecting the Industry
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Technology Trends and the ICT Market
• Convergence may destroy as much value as it creates by bringing in new sources of revenue (Pyramid)
• Bundles, access to digital content and advertisement are key to the evolving business models
• Bundles:–fixed offers: bundles are key to customer acquisition and
customer retention–mobile offers: increase data usage and ARPS.
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Technology Trends and the ICT Market
•How are firms reacting:–New services–Organisational restructuring–Mergers and Acquisitions–Firm Specialisation–New Entry