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Canada Information Technology Report Q3 2012
Business Monitor International, August 2012, Pages: 49
The Canada 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 Canada's information technology industry.
BMI View: Canadian IT spending is expected to reach US$46.9bn in 2012, up 3%, with BMI downwardly revising its forecast due to expectations of a macroeconomic cooling in H212. Government spending will continue to be constrained by a focus on cutting costs, with cost reviews being conducted by Toronto and Ontario, but there have been a spate of large tenders, highlighting continued opportunities within the sector. BMI expects Canada's IT market to continue to report moderate overall growth in 2012, although much will depend on the overall business environment.
Headline Expenditure Projections Computer hardware sales: US$14.9bn in 2011 to US$15.1bn in 2012, +2% in US dollar terms.
Forecast in US dollar terms downwardly revised due to macroeconomic factors, although Canadian PC sales reported positive growth in 2011.
Software sales: US$9.3bn in 2011 to US$9.7bn in 2012, +4% in US dollar terms. Forecast in US dollar terms downwardly revised due to analyst modification and given the large public sector deficits, vendors will need to provide clients with ways to reduce costs by increasing efficiency.
IT Services sales: US$21.4bn in 2011 to US$22.1bn in 2012, +4% in US dollar terms. Forecast in US dollar terms downwardly revised due to analyst modification with the market shaped by a continued move towards distributed computing and service-oriented architectures.
Risk/Reward Ratings: Canada's score was 70.7 out of 100.0. Canada ranks second in our latest RRR table, behind the US, but still ahead of Latin American giants such as Brazil and Mexico. The country ranked third for its Industry Rewards score, but its overall rating was boosted by a relatively high Country Rewards score of 90.
Key Trends & Developments.
- Fiscal constraints faced by the Ontario government in particular represent a challenging environment for vendors. Meanwhile Toronto authorities have also launched a Core Spending Review targeted, which could have negative implications for IT spending. However a focus, by Ontario and other authorities, on deficit reduction through public services delivery reforms should also potentially represent an opportunity for IT vendors.
- Growing interest in cloud computing is expected, with Canada currently lagging the US and some other advanced markets. The market in Canada remains fairly small. A 2011 survey commissioned by Microsoft Canada found that nearly 73% of Canadian SMEs understood that cloud-based services was a cost-effective delivery model, but that just 30% were investing in such services.
Executive Summary 5
SWOT Analysis 6
Canada IT Sector SWOT 6
Canada Political SWOT 6
Canada Economic SWOT 7
IT Risk/Reward Ratings 8
Table: Regional IT Business Environment Ratings Q312 11
IT Markets Overview 12
IT Penetration 12
Market Growth And Drivers 14
Sectors And Verticals 16
Market Overview 20
Industry Developments 28
Industry Forecast 29
Table: Canada IT Industry – Historical Data And Forecasts (US$mn unless otherwise stated) 32
Industry Forecast Internet 33
Telecoms Sector – Internet – Historical Data & Forecasts 33
Competitive Landscape 35
Macroeconomic Forecast 40
Table: Canada – GDP By Expenditure, Real Growth %, 2008-2016 42
Country Snapshot: Canada Demographic Data 43
Table: Canada's Population By Age Group, 1990-2020 ('000) 44
Table: Canada's Population By Age Group, 1990-2020 (% of total) 45
Table: Canada's Key Population Ratios, 1990-2020 46
Table: Canada's Rural And Urban Population, 1990-2020 46
BMI Methodology 47
How We Generate Our Industry Forecasts 47
Transport Industry 47