Mexico Information Technology Report Q1 2011
Business Monitor International, February 2011, Pages: 64
The Mexico Information Technology Report provides industry professionals and strategists, corporate analysts, information technology associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Mexico's information technology industry.
BMI projects that Mexican IT spending will grow by about 11% in 2011 to US$13.6bn, consolidating a strong PC market recovery in 2010. Government spending was one vendor focus in H110, with the rollout of national and local projects that had been delayed by an austerity drive in H209. Interest in cloud computing should continue to grow in 2011 after many of Mexico’s large companies conducted cloud pilots last year.
Mexico’s IT spending is forecast to grow at a compound annual growth rate (CAGR) of 10% over 2011- 2015, but with strong variation between sectors and regions. Mexico City and its surrounding area accounts for at least 50% of total IT spending in the country, but Mexico’s underpenetrated south-east and Pacific regions are expected to offer growth opportunities over BMI’s five-year forecast period.
IT spending is forecast to outpace GDP growth, with drivers including rising PC penetration and growing affordability, as well as US corporate demand for IT outsourcing. IT spending as a percentage of GDP of 1.4% remains well below OECD levels and BMI projects that per capita IT spending will rise from US$124 to US$179 by 2015.
Government IT spending was budgeted to increase in 2010 by around one-third in local currency terms. In the short term, most 2009 budgets had already been confirmed. Key national government IT spending areas in 2010 included solutions to improve tax collection efficiency, improving health services, promoting trade and enhancing security.
In 2011, government spending should grow again as public sector organisations roll out e-services and support infrastructure. Areas of spending at the federal level include integrated enterprise resource planning (ERP), back office systems, e-services platforms and interfaces.
Taiwanese giant Acer said in 2010 that it was looking for new partners to help it achieve better results in government tenders. Acer already works with around 60 distributors focused on the key government sector, with support from wholesalers. Meanwhile Chinese giant Lenovo has said that it would increase the number of its local distributors from 3,000 to between 8,000 and 10,000 in the medium term.
Vendors are focused on opportunities in the small and medium-sized enterprise (SME) sector. In 2010, leading enterprise software vendor SAP said SMEs were its fastest growing segment for its Mexico and Central American division. SAP Mexico and Central America has a client base of around 3,200 companies, of which 70% are SMEs, according to company data. Meanwhile Dell has said that around 30% of its Latin American region revenues now comes from SMEs.
One result of the economic crisis may have been to accelerate adoption of cloud computing solutions such as Software-as-a-Service (SaaS). The Chilean unit of Microsoft has a target of more than 1,000 companies using its Microsoft Online Services offerings within the next year. European corporation SAP has also targeted SMEs with its online delivery solution Business All-in-One Fast-Start as part of a partnership with HP.
Mexico’s computer hardware sales are projected at US$6.2bn in 2011 and are projected to reach around US$8.9bn in 2015. There remains considerable potential as the current level of computerisation is low, with PC penetration estimated at less than 25%. Growing broadband penetration, including 3G mobile, will drive the PC market.
Significant growth opportunity now exists in provincial areas and second-tier cities, where multinational vendors are now trying to strengthen distribution. Mexico’s under-penetrated south east region is expected to offer growth opportunities over BMI’s five-year forecast period, particularly in the public sector.
The Mexican software market is projected to reach US$2.5bn in 2011, from US$2.3bn in 2010, with imported software accounting for at least 80% of the total. One of the biggest trends in the SME segment in 2010 was standardisation of back-office processes. A combination of enterprise objectives such as cost reduction and greater efficiency should drive more adoption of cloud services in 2011.
Software spending should have an upwards trajectory as the government turns its attention to overcoming Mexico’s longstanding underinvestment in this area. The most popular applications remained basic ERP and supply chain management (SCM) solutions, while business intelligence and security software should provide growth opportunities, including more spending on networked security solutions.
The IT services market is projected at around US$4.9bn in 2011. Despite short-term economic needs, the market should ultimately grow at a CAGR of 10% through to 2015. Sectors like government, telecoms and financial services will provide the greatest opportunities for vendors over BMI’s forecast period. The increasing number of multinational companies operating in the market is an important driver for spending. Opportunities also exist in the SME sector, where companies are trying to use computing resources more effectively. Mexico is also becoming an increasingly important hub for provision of business process outsourcing (BPO) and other outsourcing services.
E-Readiness The World Economic Forum’s annual survey found Mexico continuing to make steady progress on network indicators. Mexico has climbed six places in the rankings to 49th. The report attributed the improvement to the adoption of more efficient electronic strategies for digital networks and infrastructure connection nationally and regionally.
The potential for new broadband technologies to take hold in Mexico is high, with fibre-optic infrastructure and WiMAX licences being auctioned since 2009. With the telecoms regulator, Cofetel, taking a more combative stance towards Telmex, BMI believes there is a good chance that new operators will enter the market and be responsible for strong growth.
The 2008 UN e-government survey found that Mexico had the most advanced e-services development in Latin America, with a ‘strong national government portal’ that encouraged online consultations between government and citizens.
Recent state and municipal statistics have highlighted the gradual progress made in implementing e-government in Mexico at federal and state level. In 2001, the government launched an e-government initiative that prioritised providing health, education and other government services online, as well as the development of e-commerce. Since then, however, funding has rarely been sufficient for much progress to be made given the substantial task involved, and local governments are increasingly looking to launch their own initiatives. Many states are seeking funding from the private sector to make good gaps in public funding.
Executive Summary
SWOT Analysis
Mexico IT SWOT
Mexico Telecoms Sector SWOT
Mexico Political SWOT
Mexico Economic SWOT
Mexico Business Environment SWOT
IT Business Environment Ratings
Latin America
Table: Regional IT Business Environment Ratings
Latin America IT Markets Overview
Mexico Market Overview
Government Authority
Background
Hardware
Software
Services
End-User Analysis
Industry Developments
Industry Forecast Scenario
Table: Mexico IT Sector Overview, 2006-2015
Country Context
Table: Rural/Urban Breakdown, 2005-2030
Table: Consumer Expenditure, 2000-2012 (US$)
Internet
Table: Telecoms Sector – Internet –Historical Data & Forecasts
Macroeconomic Forecast
Table: Mexico – Economic Activity
Competitive Landscape
Hardware
Software
IT Services
Internet Competitive Landscape
Company Profiles
Softtek
Softtek
SondaPissa
Country Snapshot: Mexico Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2002-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators, 2001-2006
Table: Consumer Expenditure, 2000-2012 (US$)
Table: Average Annual Wages, 2000-2012
BMI Methodology
How We Generate Our Industry Forecasts
IT Industry
IT Ratings – Methodology
Table: IT Business Environment Indicators
Weighting
Table: Weighting Of Components
Sources
- Softtek
- Softtek
- SondaPissa
Customers who bought this item also bought
All rights reserved. © Copyright 2013 Research and Markets WWW5
Terms and Conditions Privacy Policy Publishers Employment Opportunities Site Map Link to us Webmaster Affiliate Network
