2007-08 annual review_v2
DESCRIPTION
Annual ReportTRANSCRIPT
IT Industry Performance Annual Review: 2007-08
Press ConferenceNew Delhi: July 08, 2008
ITOPSITOPS
Only Only Demand-Demand-SideSide Study on Study on the Indian IT the Indian IT
Hardware Hardware marketmarket
Industry Industry ValidationValidation of of the Market the Market FiguresFigures
LongestLongest Running Running Tracker Study Tracker Study on the Indian IT on the Indian IT Hardware Hardware marketmarket
LargestLargest Tracker Study Tracker Study on the Indian on the Indian IT Hardware IT Hardware
marketmarket
About ITOPS…About ITOPS… An IntroductionAn Introduction
Only Demand-Side Study on Indian IT Only Demand-Side Study on Indian IT Hardware Market…Hardware Market… Designed to deliver the much needed demand-side Designed to deliver the much needed demand-side insightsinsights
Data is collected after ‘Last Mile’
Market/ Customer Sentiments
• No undercounting/over counting stock in pipeline• Includes direct imports by customers • Accurate estimation of assembled market
• Factors in the market/ customer sentiments and opinion along with industry level indicators
Accurate assessment of Buyer Profile
Identification of Emerging Segments
Identify and observe Market Trends
• “Who bought”, “Where used”…Not dependent on ‘perceptions’ of reseller/ channel member/ vendor
• Need to monitor changes in user’s perspective to obtain cues for innovative marketing
ITOPS
The Study covers a sample of around 24,000+ entities per round
The study is conducted on a bi-annual basis covering the following time periods H1 of FY: April to September H2 of FY: October to March
… across the Top 22 cities Greater than 1 Million Pop Towns except Bhubaneshwar &
Guwahati
24,000+Entities
14,000+Households
10,000+Estabs
Largest Study on Indian IT Largest Study on Indian IT Hardware Market…Hardware Market… Coverage in 22 Cities Coverage in 22 Cities
1996-971996-97
1998-991998-99
2002-032002-03
2003-042003-04
2005-062005-06
Launchof ITOPS as an annual Study
ITOPS becomes a Bi-annual study
Launch of supplementary channel survey for in between quarters
Coverage scaled up to 22 cities from 16 cities
ITOPS completes its 10th year, thus being the longest running IT tracking study
Longest Study on Indian IT Longest Study on Indian IT Hardware Market…Hardware Market… Existence of over 11 YearsExistence of over 11 Years
Industry Validation…Industry Validation… Two Pronged Validation Process Two Pronged Validation Process
MAIT
Findings on Market-size projected to
All - India Urban market
Various IT Players
ValidationValidation
ValidationValidation
The findings from ITOPS is accepted as the official market performance of Indian IT hardware market by Manufacturers Association for Information Technology (MAIT), the nodal body for IT hardware industry in India.
Information used by Govt. of India for all IT & allied planning.
7
Sampling & Projection Household
Using SEC A-C household population as obtained in the National Readership Survey – the largest household survey in the country
Establishment No framework for sampling and projection were available Thus, a new framework called Ace Grid was developed by the ITOPS
team This Grid stratified the establishments by Principal activity performed
at the establishment classified by number of employee.Principal Activity defined:
Manufacturing/ factory/ WarehouseOfficeOutletsGovernment
No. of employees defined: < 10 employees (Small establishments)11-50 (Medium establishments)50 + (Large establishments)
The Ace Grid has found application across researches involving business segment across geographies
Sampling & Projection…Sampling & Projection…
Some Insights that ITOPS has provided …
9
Insights on IT market from ITOPS
Our Insights What happened?
IT market moving towards the smaller cities – ITOPS 2001 Pro
Today, the smaller cities constitute close to 50% of the households. Vendor targeting a wider canvass benefiting the most.
PC usage not restricted to upper and upper middle class households only. It is increasingly percolating to middle and lower middle class – ITOPS 2002 Pro
Increased targeting of the segments through price reduction, interest free loan schemes helping in targeting the segment.
Students a key target segment in the households – ITOPS 2002 Pro
IT players launched PCs targeted at the students community.
WiFi adoption in the country is expected to take time! – ITOPS 2002 Pro
Though many WiFi zones have come up in major cities of the country, it is still not very popular among the Internet users.
Education the key reason for purchasing PC in a household – students the main focus – ITOPS 2002
Several PC vendors launched PCs targeted specifically at students and running special promotions for students. Universities a key focus for most Notebook vendors.
10
ITOPS: Comprehensive coverage
Product coverage:
Computers - Desktop PC, Notebooks, Servers
Printers - DMP, IJP, LJP
Peripherals - Monitors, keyboard, scanner, zip
drive, CD writer, Print server
UPS - UPS
Networking - Incidence, size of networking (no. of
nodes)
Networking products - NIC, Hubs
Internet - Active internet subscribers, Modems
And the findings are…..
12
Total PC (Desktops & Notebooks) sales: 2002-2008
• CAGR 2002-08: 26%
• Growth over 2006-07: 16%
Un
its
13
Total PC (Desktops & Notebooks) market: Regional spread
Figures in the brackets represent the growth in 2007-08 over 2006-07
25% 31% 27%
17%
0%
10%
20%
30%
40%
North West South East
(-13%) (39%)(10%)
(39%)
7,344,306 Units
2007-08
• PC consumption in both West and South grew by 39% each; in East it grew by 10% while in North it declined by 13%
34%
26% 23%
18%
0%
10%
20%
30%
40%
North West South East
6,341,451 Units
2006-07
14
Notebook sales: 2002-2008
• Annual sales grew by 114%; CAGR: 104%
• Households accounted for 44% of the market growing 150%, Businesses accounted for
56% of the market growing 93%
Un
its
15
Notebook sales: City-spread
• Notebooks are fast penetrating beyond the top 4 metros; growth rate 152%
16
Notebook Consumption in Businesses - by employee size%
Un
its
• Overall consumption in the business grew by 93%
• Consumption in large and medium enterprises grew by 51% and 123% respectively, in small enterprises it grew 174%
17
Desktop sales: 2002-2008
• CAGR 2002-08: 19%
• Growth over the 2006-07: 1%
Un
its
18
Desktop market: Regional spread
Figures in bracket represent the growth in 2007-08 over 2006-07
27% 30% 25%
19%
0%
10%
20%
30%
40%
North West South East
(-14%) (10%) (7%)(4%)
5,522,167 Units
2007-08
• Desktop consumption in West grew by 10%; in East it grew by 7% each; in South it grew by 4% while in North it declined by 14%
31%27% 24%
18%
0%
10%
20%
30%
40%
North West South East
5,490,591 Units
2006-07
19
Desktop Market: Share of Indian, MNC & Informal
2007-08
• Consumption of Indian brands decreased 4% in absolute terms
• Sales of MNC Brands grew by 16% however that of Informal sector PCs declined by 12% in absolute terms
2006-07
20
Desktop sales: City-spread
• Consumption in Top 4 metros declined by 28% while sales outside the Top 4 metros grew by 14%
21
Desktop sales: 2002-08
• Desktop market growth over 2006-07: 1%
• Consumption in households grew by 55%; in Businesses it declined 18%
Un
its
23%28%
26%81%
72%
60%75%
25%
40%
74%
19%
77%
22
Annual Desktop sales: Business by employee size
• Overall sales to the Business segment declined by 18%
• Sales to small and medium enterprises grew by 25% and 8% respectively, however in large establishments it declined 33%
% U
nits
23
Profile of Desktop buyers: Principal activity of the establishment
% b
uyer
s
• Consumption in Government grew by 7% and in factory locations by 47%
• Consumption declined in office locations by 21% and in retail outlets by 29%
24
Profile of PC buyers in Households by Socio-economic class%
buy
ers
• Overall Households consumption grew by 55%
• Consumption in SEC A grew by 50%, in SEC B by 68% and in SEC C by 43%.
46% 46% 51% 55%44% 43%
36% 34% 28%29%
36% 39%
18% 20% 21% 16% 20% 18%
0%
20%
40%
60%
80%
100%
2002-03 2003-04 2004-05 2005-06 2006-07 2007-08
SEC A SEC B SEC C
25
Server sales: 2002-2008
• Annual sales increased: 35%; CAGR (for 6 years): 17%
Un
its
26
Server sales: Business by employee size
• Overall sales increased by 35%
• Sales to small and medium enterprises grew by 127% and 121% respectively, however in large establishments it declined 37%
% U
nits
27
Server sales: City-spread
1936
4858 5221
9
167 26
60 55
36 3522
0%
20%
40%
60%
80%
100%
2003-04 2004-05 2005-06 2006-07 2007-08
Rest of India Next 4 Top 4
• Consumption in Top 4 metros declined by 17% while sales outside the Top 4 metros grew by 64%
28
Active Internet entities: March’99 – March’08
(Entities are establishments/individual with internet connection; an entity may house/ be multiple user/s)
• Overall entities with internet grew by 20% over March 2007
• Businesses accounted for 29% of the entities growing 6% while Households accounted for 71% of the market growing 27%
’00
0 U
nits
Translates to 52 million internet users
29
Internet penetration: March 2008
Business Segment Home
Overall 46% 21%Top 4 Metros 50% 25%Next 4 Metros 42% 17%Other 8 Metros 46% 16%Remaining 6 Metros 28% 11%
SEC A - 43%SEC B - 16%SEC C- 6%
• Internet Penetration by Town class and Socio-Economic Classification (SEC) among Top 22 Cities
Internet penetration by
Town class
Internet penetration among households
by SEC
30
Mode of Internet access in Businesses: March 2008
Internet connections - Contribution to the total by Access type
March 2007
March 2008
Dial up 38% 16%ISDN 19% 18%Leased line 15% 7%DSL/Cable Link 38% 43%VSAT 1% 2%Data Card * 12%Others * 2%
DSL
Data Card
DSL inching ahead.
Data Card fast growing in popularity
31
The Market of 2007-08 Vs 2006-07
32
The expected Market for 2008-09
33
Thank you!