- Language: English
- 75 Pages
- Published: April 2012
- Region: Kuwait
Oman Information Technology Report 2012
- Published: February 2012
- Region: Oman
- 54 Pages
- Business Monitor International
The total size of the Omani IT market in 2012 is forecast by BMI to be worth US$363mn, up from an estimated US$339mn in 2011. BMI forecasts a CAGR of 6% for 2012-2016. Oman's economy is relatively well positioned, but we do not see IT spending returning to its previous rate of growth during our five-year forecast period. Meanwhile, global trends such as cloud computing, virtualisation and convergence are gaining traction in the Omani market.
Oman's IT market is only about 10% of the size of the Saudi market but the government is investing in IT as part of its e-Oman initiative, the strategy to diversify the economy and computers for schools procurements. In addition to ongoing demand from the oil and gas sector, this should generate IT spending in industries such as telecoms, financial services and aviation.
Oil and gas remain the main pillar of the local economy and will generate spending on customised solutions, hardware and software support. Economic reform and trade liberalisation will fuel spending by public sector organisations and private enterprises. Growth in e-commerce will also drive spending by businesses on e-commerce platforms and back-office systems.
Industry Developments The government's e-Oman goals include bridging the digital divide and making e-government services available to all people in the country. The ITA has launched a number of IT-related infrastructure projects, with one core component being an e-government services portal, which is a gateway to services offered by government departments online.
During the global economic slowdown, private sector IT spending slowed, but the government kept spending on IT projects within its e-Oman framework. Government projects in education and e-services will be an important source of spending. In FY10/11, government procurements of PCs and accessories for schools by the Ministry of Education were worth around US$3.2mn.
The US-Oman free trade agreement, which came into effect in January 2009, has provided indirect benefits for the ICT sector beyond the direct relaxation of barriers to trade. Oman was also required to introduce various reforms, particularly in the areas of labour law and copyright protection.
The Omani PC market remains dominated by international players such as Acer, HP and Dell. Multinational vendors have started to build closer relations with the local channel. Japanese consumer electronics giant Toshiba claimed in 2011 to have achieved a 24% share of the Omani notebook market, based on greater support for partner Bahwan Group. HP has bolstered its regional channel strength by signing an agreement with IT distribution company Logicom. Meanwhile, Dell works with Asbis as a dedicated distribution partner for Oman.
Similarly, many software vendors served their Omani customers from out of the UAE but the growing number of customers in the country has tempted more vendors to establish new local bridgeheads. Microsoft has strengthened its presence in Oman with a dedicated in-country partner account manager and stronger support infrastructure. In 2011, Microsoft highlighted its growing ambitions for the Omani market by unveiling plans to form a new sub-region comprising Bahrain and Oman.
Most IT services vendors are focused on opportunities in major IT verticals such as oil and gas, government, financial services and aviation. HP is midway through a five-year deal with Petroleum Development Oman. IBM's partner Gulf Business Machines received a share of the e-government portal project from the ITA.
Oman's hardware sales are forecast to reach US$196mn in 2012 and grow by 5% per year to US$239mn by 2016, according to BMI forecasts, with drivers including the growing popularity of notebooks, falling prices, government initiatives and trade liberalisation. Oman is one of the Gulf's less developed PC markets. In 2011 consumers remained cautious and much of the growth was fuelled by demand for lower priced notebooks and netbooks, which deflated average prices.
The PC market is being driven largely by demand for notebooks. Wireless connectivity will boost demand, stimulated by product innovation and new technologies. Small and medium-sized enterprises (SMEs), as well as large companies, are expected to invest in equipment to deal with increased competition and take advantage of regional opportunities.
The Omani addressable software market is projected by BMI at US$70mn in 2012 and is expected to grow at a CAGR of 7% over 2012-2016. In 2011, there was a pickup in project flow from significant IT verticals such as oil and gas and banking. With the evolution of the IT market, a stronger enterprise focus on software spending is also being seen, with companies preparing to compete in a regional environment of greater trade freedoms.
Cloud computing is a relatively small niche of the Omani IT market but has high growth potential. In 2011, software vendors were rolling out new hosted solution offerings in the Omani market, targeted at private enterprises as well as public sector organisations.
The Omani IT services market was expected to be worth around US$96mn in 2012 according to BMI forecasts, accounting for about 27% of all IT spending in the country. Spending on services is predicted to continue expanding as banks, telecoms companies and government agencies in particular invest in IT that will enable them to compete more efficiently in a changing regional environment.
BMI projects that about a third of spending will be on support and maintenance, with systems integration (SI) the second largest category and managed services/outsourcing accounting for about 20%. Many vendors see opportunities to expand their service portfolios as enterprises demand mre out of their IT investments. SHOW LESS READ MORE >
BMI Industry View
Oman IT Industry SWOT
Oman Telecommunications Industry SWOT
Oman Political SWOT
Oman Economic SWOT
Oman Business Environment SWOT
Middle East Market Overview
Relevant Government Authorities
Industry Business Environment Overview
Table: Regional IT Business Environment Ratings
Table: IT Industry, Historical Data And Forecasts, 2008-2016 (US$mn, unless otherwise stated)
Table: Oman Internet Historical Data And Forecasts, 2009-2016
Table: Oman – Economic Activity
Gulf Business Machines
- Gulf Business Machines