|
|
 |
|
Viewing report
|
|
|
|
Chile Information Technology Report Q3 2011
Business Monitor International, July 2011, Pages: 59
BMI's Americas IT Business Environment Ratings compare the potential of a selection of the region's markets over our forecast period to 2015. The ratings reflect our consideration of political and economic risks, as well as risks associated specifically with IT intellectual property rights protection and the implementation of government information and communications technology (ICT) projects.
In Q311, for the first time we have added Canada to our regional BER analysis, where it makes its entry at second place in our rankings table. Despite current fiscal constraints, the Canadian government's digital economic strategy provides a framework for IT market growth, with a number of programmes being implemented. One key initiative is Broadband Canada, which has a mandate to expand broadband Despite Canada being a relatively mature market, there still remains plenty of potential for software vendors in industries such as consumer products, telecommunications, energy, engineering, construction, transport, food and beverage as well as retail. Growing interest in cloud computing is expected, with Canada currently lagging the US and some other advanced markets.
However, the US retains its top position in our regional rankings as by far the largest IT market in the region and the world, accounting for about 25% of global IT spending. Despite a sluggish economic recovery and the challenge from faster-growing IT markets such as Brazil, the US is forecast to maintain its global IT market leadership position.
In Q111 the US commercial PC segment showed signs of vitality, particularly small and medium-sized enterprises (SMEs), but there was a sharp dip in consumer sales. During the next few years, across consumer and business segments, US IT spending is expected to be driven by a number of factors including product and technology innovation, and investment in fixed and mobile broadband infrastructure as well as economic recovery.
A major opportunity will be demand from private and public sector organisations aiming to use cloud computing services. In 2011 there are expected to be many more contracts for the provision of cloud services, following on contracts awarded during 2010 by the cities of New York and Los Angeles, and the General Services Administration (GSA) of the federal government. As the US economy recovers, there will also be more growth in traditional big-spending IT verticals such as financial services, retail and manufacturing. Meanwhile, government remains a key source of projects.
The Latin American IT market outlook remains positive in Q311, with BMI retaining its IT business environment ratings. Low PC penetration means continued growth potential in a region characterised by significant income and geographic disparities. In many markets, increased penetration of credit cards and credit availability from stores, as well as a growing organised retail sector, should contribute to growth. Brazil is expected to be one of the best performing regional IT markets over BMI's five-year forecast period, with double-digit growth. The government's launch of a US$344mn modernisation strategy in late 2010 should mean enhanced IT spending over the next few years. A National Broadband Plan was announced in 2010 and modernisation, ahead of Brazil's hosting of the 2014 FIFA World Cup and 2016 Summer Olympics, should also help to drive demand for IT products and services.
In 2011, Brazilian consumer PC sales are expected to continue growing, due to economic growth and low unemployment fuelling consumer confidence. In 2010, shipments growth was boosted by major government procurements at national, provincial and municipal levels, and this should continue.
Meanwhile, a PC penetration rate of less than 25% indicates there is plenty of room for market growth. Brazil is our third highest ranked market in North and South America, ahead of Mexico, which drops back one place into fourth position. Brazil scores higher than Mexico on market and country structure factors, but both have strong growth drivers. Mexican IT spending is expected to grow at a double-digit compound annual growth rate (CAGR) over BMI's five-year forecast period.
Brazil and Mexico account for about 75% of PC sales in Latin America, with economic growth lifting millions into a computer-owning middle class. However, Brazil ranks higher than Mexico due to market size and country structure environment. At twice the size of Mexico's market, Brazil is already estimated to be the fifth largest PC market in the world. However, Brazil's company spending on IT, measured as a percentage of revenues, is understood to lag behind global peers. Growing broadband penetration, including 3G mobile, will drive the PC markets of both countries.
Spending by the Mexican government should grow as public sector organisations launch e-services and supporting infrastructure. Other market drivers include rising PC penetration and growing PC affordability, as well as US corporate demand for IT outsourcing. Close ties with the US are a long-term driver of Mexican IT opportunities. For example, the city of Monterrey is becoming an important outsourcing hub.
However, despite business environment improvements, there are structural inhibitors in Mexico and Brazil. In Brazil these include a significant digital divide and bureaucracy. Mexico has a heavily regulated labour market, while some vendors also have concerns about an apparent escalation in drug violence, which may affect channel activities in some regions of the country and increase operating costs. Meanwhile, Chile's fifth place in our table reflects its status as one of the most developed markets in the region. Chilean IT spending is projected to grow at a CAGR of 8% over 2011-2015. A wide-ranging government plan to increase ICT utilisation in government and other sectors such as healthcare and education will encourage IT investment. The 2010 earthquake may have diverted consumer funds from technology to other priorities, but reconstruction offers opportunities for government agencies to advance IT modernisation.
Chile's relatively high ranking, ahead of Argentina, is partly because it has the highest country risk rating of any of the states in our Latin America table. However, PC penetration is below 20% in Chile and 25% in Argentina, so there is considerable room for growth in both countries.
In seventh place, Argentina's IT spending is projected by BMI to grow at a CAGR of 15% in 2011-2015. Recovery will be driven by rising incomes, expanding retail channels and a high-tech-focused national development plan. The Argentine market is dominated by the capital Buenos Aires, which accounts for about one-quarter of computer sales. Continued growth in PC sales is expected and IT spending is driven by factors such as greater credit availability and growing broadband penetration.
Educational tenders will be a particular area of opportunity for the Argentine market, with a tender to deliver 3mn PCs to public schools, due to be implemented over the 2010-2012 period. Another driver will be the introduction of new regulatory compliance laws for electronic invoicing.
Peru and Colombia are in sixth and eighth positions respectively. Peru's free trade agreement (FTA) with the US will boost demand for IT products and services. The regional structure of the Peruvian market will evolve, with slower growth likely in Lima compared with other Peruvian provinces.
Colombia's consumer-driven economic boom of the past few years has faded, but a PC penetration rate of about 10% is one of the lowest in the region and indicates untapped potential. Investment in datacentres, information management and security solutions are expected to be growth areas in the large company segment. Peru and Colombia offer opportunities despite some business environment risks. Besides the boost from the US FTA, there are opportunities in Peru across the banking and financial services, telecoms, retail, and mining sectors as well as SMEs.
Government programmes are also a factor, particularly PCs for schools. In Colombia, the government regards ICT as a way to advance its strategic goal of helping reintegrate disaffected groups. The government's new Vive Digital programme offers a potential boost to the IT market, with a pledge to eliminate import tariffs on connectivity devices and take measures to enhance credit availability for such devices.
Venezuela's last place in our rankings reflects our judgement that the economic situation and business environment in the country are unfavourable for IT spending growth. The consumer-driven growth is also slowing because of economic uncertainty, the collapse of oil prices and currency devaluation. The steep devaluation of the bolívar for non-essential imports such as computers will depress spending, as consumers grapple with the erosion of real wages.
BMI expects flat or negative IT market growth in US dollar terms over our five-year forecast period, but there will be areas of opportunity. The Venezuelan government's 2007-2012 economic plan has a key role for technology in development and various public bodies are launching e-infrastructure projects. Meanwhile, the government's affordable computer programmes have encouraged more local production of computers.
Chile 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 Chile's information technology industry.
Product samples
A sample for this product is available. Please Login/Register to download this sample.
|
|
|
|
