The Indian domestic IT, ITeS market to touch Rs 1,10,000 crore in 2008, while sustaining the growth of 27 per cent recorded in 2007, according to a study by IDC India. This would result into the market growing at 24 per cent in 2008 over 2007.
The year 2008 is set to mark the beginning of growth phase 2.0 to be characterised by opportunities arising out of the leveraging of the IT infrastructure built up so far.
This was revealed by IDC India, as part of its annual predictions for the domestic IT market for 2008 that serve as a comprehensive reference guide for the industry.
"By posting a substantial jump in the domestic IT/ITeS market since 2002, the industry is now onto a new growth trajectory. IDC India expects a significant transition in the Indian IT market as part of the Growth Phase 2.0," said Kapil Dev Singh, Country Manager, IDC India.
"Growth Phase 2.0 will leverage the IT infrastructure and technical capability built up so far to offer new-age services to the Indian enterprises and consumers," added Singh.
Over a dozen analysts from IDC India spent the last few weeks to put together key predictions for 2008:
Growth Phase 2.0
The India domestic IT market will transform significantly with the existing IT infrastructure evolving both in technology terms and depth of penetration. Higher demand for sophisticated enterprise and consumer services will drive this trend as the India domestic IT market 'comes of age'.
Not only are key market segments growing at a healthy pace, the evolution of the market is visible in the scale and scope of enterprise IT infrastructure deployment across all verticals as well as emerging verticals, including the government.
The consumer IT sector maturity is driven by the launch of new consumer Internet, telecommunication services (Fixed-Mobile Convergence, tele-presence, Web 2.0 and social networking sites, online and mobile gaming, music and video downloads), as well as healthy growth in shipments of mobile handsets, consumer notebook PCs and accessories. The growth in IT retailing also underscores the 'arrival' of the consumer IT phenomenon in India.
Digital Experience
The Digital Experience for the Indian consumer to hit the next level. Fixed-line broadband to emerge as a dominant trend in 2008. Indian customers have already started living the digital experience.
The New Year will take this experience to the next level. In all markets customers are being offered a variety of choices not seen before in the country. Convergence is playing an important role in bringing different media together to offer multiple services to customers over the same platform.
The Indian telecommunication products market can also be categorized into distinct and rapidly evolving segments. An example of this is the mobile phone, which offers music, Internet connectivity, corporate email services, messaging, camera and games among others.
According to IDC fixed-line broadband will emerge as a favoured choice in 2008, though mobile Internet will continue to grow as an alternative Internet access medium.
In the first half of 2008, all major operators will be offering broadband up to 8 Mbps to consumers in metros and some other key cities. Bandwidth-hungry applications like IPTV, online gaming and VoIP will ensure a healthy uptake of VHSB in 2008 and beyond.
Fixed Mobile Convergence (FMC) will signal the onset of a new battle in the Indian telecom sector; integrated service providers will gain edge, the stage will also be set for a significant onset of Unified Communications (UC) services.
FMC starts making sense to operators when they cross thresholds in both fixed-line and mobile subscriber numbers. This, according to IDC India is now truer for all major integrated telecom service providers in the country, and those who are able to roll out FMC first stand to gain the most.
FMC as marketing tool
One stream of 'top-ups' will come from the service provider's existing mobile subscriber base, of which a certain percentage would also sign up for fixed-lines, to avail the benefits of FMC. Further additions would happen through subscriber churns from other service providers, for both fixed-line and mobile services.
Even as vendors reach out to new geographies (beyond BRIC) for growth, India would continue to remain the centre of attraction. As the BRIC nations move towards IT maturity, vendors are scouting for new emerging geographies to maintain sustainable growth. IDC India expects India revenues to grow the fastest during 2006-2011 amongst all BRIC nations even if the focus moves beyond the BRIC countries. India, currently contributes to about one fifth of the total BRIC revenues.
Virtualisation will become mainstream in 2008 as it gains wide-scale adoption. Enterprises across segments like IT-ITeS in India have been early adopters of consolidation and virtualisation.
IDC India estimates the share of virtualised servers to double from the present 22 per cent to 45 per cent by 2008 end. In addition to benefits like ease of management and better resource utilization, enterprises are increasingly becoming aware of additional benefits like design densities, power and cooling.
Riding on the success of server virtualisation, storage virtualization is also coming of age in India. The success stories of virtualization that have gained momentum are expected to have a positive impact on other segments like manufacturing, BFSI and aviation during 2008.
Peak efficiency
In today's competitive business environment, the enterprises need to operate at peak efficiency even as the complexity of operations grows. As this occurs, managements are realising that technology fundamentally underpins most, if not all, of its business processes, and uptime and management is a key concern as they strive to get more out of less.
Delivery mechanisms will witness significant change with both Tier I and Tier II managed services providers setting up more Network Operation Centres (NOCs) and Security Operation Centres (SOCs) to adhere to stringent QoS (Quality of Service) and SLAs (Service Level Agreements).
Web 2.0 market
Web 2.0 market in India to take off in 2008, shakeouts and a possible string of consolidations to follow. With over 75 active Web 2.0 start-ups in 2007 and global heavyweights like Orkut, Wikipedia, YouTube and Frickr enjoying a mindshare of Indian users, the market is poised for a take-off in the second half of 2008. The entry of big players in the market will lead to increased spend on marketing and promotions.
This will lead to increased user awareness and participation, something that will benefit and accelerate the overall Web 2.0 market in India. While smaller players will feel the pressure, the overall market will benefit from an increased user awareness and participation. |
