The Changing Dynamics of the Global High Tech Industry an Analysis of Key Segments and Trends

7/28/2019 The Changing Dynamics of the Global High Tech Industry an Analysis of Key Segments and Trends

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Business Process Outsourcing the way we do it

Contents

Introduction 5

Industry Overview 6

High Tech Industry Value Chain 8

Consumer Electronics 9

Tablet PCs will drive the global

consumer electronics market 10

TVs will continue to evolve as smarter 10

Evolution of user interfaces 11

Semiconductors and Solar 12

Semiconductors 12

Growth of media tablets and eReaders will

continue to fuel demand for semiconductors 13

Automotive will be the next pillar of growth

for semiconductor suppliers 14

Wireless Local Area Network (WLAN)

chipset market set to outpace the average

semiconductor industry growth 15

Global solar power market 16

Print and Imaging 17

Print and imaging market 17

Technology highlights in the printand imaging market 17

Vendor highlights 17


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Imaging, digital cameras, high definition

and single-lens reflex cameras (SLR ) 18

Regional highlights in imaging, digital cameras,

high definition and single-lens reflex

cameras (SLR) 18

Convergence of print and

photocopy machines 19

International compliance and managed

print services 19

Digital single-lens reflex cameras (DSLR)

driving growth in emerging markets 19

Computers and Peripherals 20

Personal computers 20

Regional highlights in personal computers 21

Server market 21

Consumer segment to lead the PC

business in mature markets 23

Green IT 23

Personal computers will not be personal

anymore; they will be shared computers 23

Enterprise Software 24

Enterprise Software 24

Cloud computing to evolve over the next

few years 25

Hybrid software landscape to emerge 25

Collaborative analytics will transform the

business intelligence space 25

Conclusion 26


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The global economic meltdown of2009 had a massive impact on themanufacturing industry. According toEconomist Intelligence Unit data,global industrial production decreased9.2% in 2009 after increasing just0.1% in 2008. JP Morgans GlobalManufacturing Purchasing Managers

Index (PMI) showed a sharp decreasein output beginning in mid 2008 ascompanies slashed inventory. Thedecline reached its bottom in January2009, followed by an improvement.By mid 2010, manufacturing outputshowed some increase.

The world economy expanded at anannual rate close to 5% in the firsthalf of 2010. IMF estimated worldindustrial production registered

growth rates of about 15%, and globaltrade recovered at rates over 40%during this period. The key reasonsfor the improvement were a suddenincrease in inventory levels and fixedinvestment accounts.

Industry Overview

The high tech industry was relativelyinsulated from the economic swingsof recent years because of its globalnature of operations. The high techindustry as a whole, other than a fewkey segments like consumerelectronics, was not affected as badlyas other manufacturing segments.

Initiatives like the introduction oflow-cost netbooks, average priceerosion of mobile phone sales and theemergence of alternate deliverymodels like Cloud and Software-as-a-Service (SaaS) helped high techmanufacturers ride the 2009 downturn.

From 1995 to 2007, high techmanufacturing output in terms ofgross value added (GVA) registeredhigher growth when compared to the

total manufacturing output. TheUnited States, the European Unionand few of the Asian economies wereexperiencing growth closer to theworld average, whereas Japans outputdeclined from 27% to 11% duringthe period.

Source UNCTADStat

http://unctadstat.unctad.org/TableViewer/tableView.aspx?ReportId=95

Figure 1: Manufacturing GVA as % of Total GVA

0%

100%

80%

60%

40%

20%

2006 2007 2008 20092005

82.2%

17.8% 17.8% 17.9% 17.8% 17.6%

82.2% 82.1% 82.2% 82.4%

US$43 trillion

Manufacturing Value Added Others

US$46 trillion US$52 trillion US$57 trillion US$54 trillion


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Figure 3: High Tech and Electronics Industry Worldwide Revenue and Net Profit Margin Trends

150 8

6

4

2

0

-2

100

50

Revenue Index

RevenueIndex,

NetProtMargin%

baseyear2002=100

Net Prot Margin

Q1-04

Q2-04

Q3-04

Q4-04

Q1-05

Q2-05

Q3-05

Q4-05

Q1-06

Q2-06

Q3-06

Q4-06

Q1-07

Q2-07

Q3-07

Q4-07

Q1-08

Q2-08

Q3-08

Q4-08

Q1-09

Q2-09

0

Figure 2: High Tech Manufacturing Production

0

5

4

3

2

1

-15%

-10%

-5%

0%

10%

5%

15%

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

3.0%3.3%

-1.4%

9.1%9.4%

-9.4%

-2.5%

11.9%

13.3%

9.3%

8.3%

9.9%10.5%

High Tech Manufacturing Production Value Growth Rate

HighTechManufacturingProduc

tionintrillionsofUS$

Year-On-YearGrow

thRate%

Chinas growth in high techmanufacturing output outpaced theworld average from US$19 billion in1995 to US$167 billion in 2007. TheUS share of the global value-added piein terms of high tech manufacturingwas stable over the decade until theeconomic downturn.

With the economy reviving, themanufacturing industry is once again

back on track with the high techsegment leading the recovery.

According to Manufacturers Alliancefor Productivity & Innovation (MAPI)1US high tech industrial productionrose at a 2% annual rate from the firstquarter to the second quarter of 2011.MAPI is also anticipating this sector to

increase by 9 percent in 2011 andshow 11% growth in 2012.

High Tech Manufacturing the way we see it

Source National Science Foundation website

http://www.nsf.gov/statistics/

Source IDC: Optimizing Channel Coordination in High-Tech and Electronics Manufacturing: Flawless Sales Execution from Initial Lead Generation Through After sales Service, Simon Elli s, October

2009

1 Manufacturers Alliance for Productivity & Innovation (MAPI): MAPI Quarterly U.S. Industrial Outlook

http://www.mapi.net/MediaCenter/news/Lists/Posts/Post.aspx?ID=314


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High Tech Industry Value Chain

Overall the high tech industryvalue chain can be classifiedbetween semiconductors andcontract manufacturers and OriginalEquipment Manufacturers (OEMs).Traditionally semiconductor

companies supply manufacturerswith thousands of other componentsto manufacture a device. Then thesoftware companies or embeddedsoftware providers develop theplatform or software that is laterinstalled in systems to provide life tothe device.

In addition, there are thousandsof other suppliers responsiblefor providing basic components

required by OEMs, which existhigher in the value chain. However,with the changing dynamics in theindustry these suppliers are gradually

becoming partners in the design andproduction phase to large OEMs.

Generally, the high tech industryis affected by shorter technologylifecycles. The value chain faces the

challenge of being too asset heavy(semiconductors), brand heavy(consumer electronics) and complexin terms of technology (computer andtelecom equipment). This often addsto the already increasing complexity,particularly for companies that spanmultiple sub-segments.

At the bottom end high techcompanies effectively manage complexsales channels through distributors,

resellers and partners.

Source IDC: Optimizing Channel Coordination in High-Tech and Electronics Manufacturing: Flawless Sales Execution from Initial Lead Generation Through After sales Service, Simon Elli s,

October 2009

Figure 4: High Tech Industry Value Chain

ConsumerElectronics

ElectronicEquipment

Active

Components

DisplayComponents

PassiveComponents

Printed Circuit Boards

Distributors

Printed CircuitBoard Assemblies

EMS and ODMS

Distributor

CorporateBuyer

Disposal

Consumer

Retailer

Packaging and

Interconnection

Semiconductor

FablessSemiconductor

Metals

Nonferous

IronandSteel

Chemicals

(SpecandBa

sic)

(Dedicated Foundries)

Manufacturing

Contract ManufacturerBase Materials Sales & ServiceElectronic Equipment& Telecom


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Consumer Electronics

With the global economic recovery,the global consumer electronicsmarket is expected to grow 10.4% in2011 to US$964 billion, accordingto the Consumer Electronics

Associations retail forecast2. In

2010, worldwide sales of consumerelectronics products grew 13% toUS$873 billion from 2009. In 2009the total retail sales of consumerelectronics goods fell 9% amountingto US$771 billion in the midst ofthe recession.

The segment forecast for 2011 is morethan twice as strong as the worldsgross domestic product (GDP),a measure of the size of the total

economy. The world GDP is expectedto register growth of 4.5% in 2011.With these positive numbers a senseof optimism is back among enterprisesspanning from the smallest start-ups

to the biggest conglomerates to keepinvesting for continued growth.

In 2010 the revival of the consumerelectronics industry was apparentaround the world, with nearly every

region registering sales growth. Theonly region facing growth challengeswas Japan, but in China consumerelectronics sales grew by 25% andin Africa the growth was 70%, albeitfrom a lower base. By comparison,all the regions of the world witnessedmuch lower sales in 2009 whencompared to 2010. In 2011, North

American sales are predicted to growby 15%, Western Europe to grow by23%, China by 15% while Japan is

predicted to garner 8% growth.

Overall, according to the ConsumerElectronics Association, the US inparticular will continue to drive the

9

Source GfK: World Market of Consumer Technics, Juergen Boyny, May 12, 2011

Figure 5: Consumer Electronics Global Retail Sales Revenue, 2008 2011

0

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1,000

800

600

400

200

-15%

15%

10%

5%

0%

-5%

-10%

2009 2010 20112008

RetailSalesRevenueinmillion

sofUS$

6.9%

849.0 771.0 873.0 964.0

-9.2%

13.2%10.4%

Revenue Growth

YearOnYearGrowth%


2 Consumer Electronics Association retail forecast

http://www.chinapost.com.tw/business/global-markets/2011/01/15/287688/Consumer-electronics.htm


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Source GfK: World Market of Consumer Technics, Juergen Boyny, May 12, 2011

global consumer electronics industrywith the EU close behind. However,this growth pattern is expected to shiftas demand from developing nationsrises and the Asia Pacific regionemerges as a major influencer.

The Indian consumer electronicsindustry is expected to grow at a

Compound Annual Growth Rate(CAGR) of about 19% in 2010-2013.

Among all products the highestgrowth in 2010 was booked by smartphones, which registered a 51%year-on-year growth. In the nearfuture, smart phones are expected tocontinue dominating the growth curvefollowed by mobile and personalcomputers (PC). At the same time,video game sales dropped in 2010for the second consecutive year due

to the relative demand saturation.Moving forward, digital technologiesrelated to connectivity and mobilitywill be crucial in further acceleratingthe consumer electronics industrysgrowth.

Growth in terms of products comesprimarily from smart phones,netbooks, laptops, ethernet-connectedTVs, high-definition camcorders, LEDTV players, eBook readers and Blu-rayplayers. In the near future, consumerswill continue to move beyond high-definition video on TVs to web-connected TVs.

In the recent past, there was a gap inthe market for devices with screensranging between 5 inches and 15inches. With an eye to bridge the gap,manufacturers launched a numberof smart books, eBook readers andnetbooks. However, netbooks aremore consumerized now withvendors finally able to break intomass markets.

Tablet PCs will drive the globalconsumer electronics market

Despite the fact that tablet PCs are notnew and have existed for quite sometime the market was transformed

Figure 6: Consumer Electronics Global Retail Sales Revenue Split by Regions, 2008, 2010 & 2011

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2008 2010 2011

North America, 21%

Europe, 35%

China, 10%

South America, 9%

Rest of APAC, 12%

Japan, 8%

Africa & Middle East, 5%

North America, 21%

Europe, 29%

China, 12%

South America, 10%

Rest of APAC, 12%

Japan, 10%


North America, 21%

Europe, 28%

China, 13%

South America, 12%

Rest of APAC, 12%

Japan, 8%


Bars may not equal 100% due to rounding

%S

plit

with Apples launch of the iPad inmid 2010. This market is at a nascentstage with many players launchingproducts. These devices are typicallyof similar hardware specifications,following the latest trend for netbooksand other small devices.

Players like Apple have experienced

tremendous success in the consumermarket and are likely to post evenstronger growth in the recent future.Moving forward, the tablet PC marketis predicted to be highly competitivewith many new entrants in 2011 andthe coming years. According to IDC3worldwide media tablet shipmentsexpected to grow from 7.6 millionunits in 2010 to more than 46 millionunits in 2014, representing a CAGRof 57.4%.

TVs will continue to evolve as

smarter

Television is getting smarter withthe addition of features like web

3 IDC: Worldwide and U.S. Media Tablet 2010-2014 Forecast, By: Susan Kevorkian, Bob ODonnell, 20 May 2010


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Semiconductors and Solar

Semiconductors

Affected by the global economicrecession, sales in the globalsemiconductor market declined by10.4% from US$255 billion in 2008

to US$228 billion in 2009. However,in 2010 worldwide semiconductorrevenues increased 30.9% to reachUS$299 billion, according to the latestGartner semiconductor spendingforecast.

The industrys recovery was strongand sustainable across all the keymarket verticals, regions and devicecategories. Applications, increasingtraction of smart phones, media

tablets and eReaders, automotiveinfotainment, notebook PCs, datacenter servers, and wireless and wiredcommunication infrastructure aredriving the robust consumption ofsemiconductors worldwide.

Figure 8: Revenue from the Consumption of Semiconductors Forecast, 2009 2015

0

50,000

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0%

2009 2010 2011 2012 2013 2014 2015

Revenuefromt

heConsumptionof

SemiconductorsinmillionsofUS$

Year-On-YearGrowthRate%

-10.4%

30.9%

5.1%

8.6%

1.0%

6.7%8.3%

228,673

299,364

314,721341,903

345,173

368,454

399,110

Revenue Growth

The largest category of thesemiconductor market is allgeneral-purpose standardsemiconductor products, which wasestimated at US$196.8 billion in2010. This figure is expected to reach

US$259.5 billion in 2015, reflectingCAGR of 5.7% during the period2010 to 2015.

All application-specific devicesemerges as the second fastest growingcategory with a CAGR of 6.1%,higher than the overall semiconductorgrowth figure of 5.9% for the period2010 to 2015.

Finally, non-optical sensors remains

an important space and emerges asthe fastest growing category. Gartner4estimates this segment will grow fromUS$4.0B in 2010 to US$7.2B in 2015,representing CAGR of 12.5%.

Source Gartner, Inc.: Gartner Market Databook, 2Q11 Update, Richard Gordon, Peter Kjeldsen (Telecom), Kathryn Hale (IT Services), Jonathon Hardcastle (Computing Hardware) and Colleen

Graham (Software), 29 March 2011

4 Gartner, Inc.: Gartner Market Databook, 2Q11 Update, Richard Gordon, Peter Kjeldsen (Telecom), Kathryn Hale (IT Services), Jonathon Hardcastle (Computing Hardware) and Colleen Graham(Software), 29 March 2011


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Source Gartner, Inc.: Gartner Market Databook, 2Q11 Update, Richard Gordon, Peter Kjeldsen (Telecom), Kathryn Hale (IT Services), Jonathon Hardcastle (Computing Hardware) and Colleen

Graham (Software), 29 March 2011


Figure 10: Semiconductor Worldwide Forecast, 2Q 2011 Update

0%

All General-Purpose Standard Products All Application-Specic Devices

Non-Optical Sensors

Revenuefromt

heConsumption

of

SemiconductorbyCategoriesinmillio

nsofUS$

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

2008 2010

196,862

98,460

4,012

259,578

132,287

7,245

Figure 9: Worldwide Semiconductor

Market by Region, 2009

China, 41.0%

Europe, 13.2%

Japan, 16.9% Americas, 17.0%

ROW, 11.9%

Source Semiconductors Industry Association and

CCID Consulting

Semiconductor consumption in Chinacontinues to outpace the rest ofworld. In 2009, Chinas share of thesemiconductor market was 41% whilethe Americas and Japan were at 17%and 16.9%, respectively.

In terms of market share, Intelcontinues to lead the market withclose to 14% market share, followedby Samsung at 9.4%. Other leadingchip suppliers are Texas Instruments,Toshiba and STMicroelectronics.Together, the top 10 vendorsrepresent 49% of overall marketrevenues.

Growth of media tablets and

eReaders will continue to fueldemand for semiconductors

According to Electronics.ca, mediatablet and eReader semiconductorsregistered growth of over 2,000% to

reach US$3.3 billion in 2010. Thesemiconductor suppliers continue toenable OEMs to bring new productsto the market. The starting point wasthe launch of the iPad after which themarket has shown a high degree of

optimism. Further, sales of theAndroid Honeycomb Media Tabletand eReader semiconductor areexpected to grow by over 100% in2011.

Semiconductor firms often enabletablets with features like touchscreencontrollers and sensors, basebandmodems, wi-fi chipsets and relatedintegrated circuits (ICs). In the recentpast growing interest among

consumers has created unlimitedopportunities for semiconductorsuppliers in developing new chips andsoftware platforms that will enablethese products and will provide abetter user experience. Beyond


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Figure 11: Worldwide Semiconductor Market Share, 2010

Broadcom 2.2%

2.4%

2.7%

3.3%

3.4%

3.5%

4.0%

4.1%

9.4%

14.0%

Qualcomm

Micron Technology

STMicroelectronics

Hynix Semiconductor

Renesas Electronics

Texas Instruments

Toshiba

Samsung Electronics

Intel

0% 5% 10% 15%

Source Gartner, Inc.: Market Share Analysis: Preliminary Total Semiconductor Revenue, Worldwide, 2010, Peter Middleton, Steve Ohr, Gerald Van Hoy, Nolan Reilly, Andrew Norwood, John

Barber, Adriana Blanco, Jon Erensen, Christian Heidarson, Masao Kuniba, Ben Lee, Adib Carl Ghubril, Bryan Lewis, Mark Hung, Sergis Mushell, Ganesh Ramamoorthy, Paul ODonovan, Marielena

Oppenheimer, Hiroyuki Shimizu, Amy Teng, Joseph Unsworth, Andrew Philips, Alfonso Velosa, Brady Wang, Jamie Wang, Masatsune Yamaji, 13 April 2011

semiconductors, these suppliers arealso targeting opportunities to provideOEMs with system software as well asaccess into app stores therebyreducing the product lifecycles.

According to the IDC report5,Worldwide Media Tablet and

Semiconductor Forecast: TheExplosion of an Opportunity, theappeal of media tablets will drive thesemiconductor revenue opportunity toa five year CAGR of 31%.

Automotive will be the next pillar

of growth for semiconductor

suppliers

The automotive industry hastransformed over the last couple

of years with rapid integration ofsemiconductors into vehicles resulting

in improved overall performanceand efficiency. The advent ofsemiconductors in the automotiveindustry has enabled many vehiclemanufacturers to implementapplications on a single chip andavoid unnecessary complexities.

According to a report publishedby Frost & Sullivan, arrival of theconcept of integrated electronicssolutions was one of the primarydrivers of growth. However, afterexperiencing stiff decline in vehicledemand from 2008 automotivesemiconductor sales are back ontrack with the revival of the globaleconomic outlook in 2011.

According to Semicast, the

market volume for automotivesemiconductors is forecasted to grow

5 IDC: Worldwide Media Tablet and eReader Semiconductor 20112015 Forecast: The Explosion of an Opportunity by Michael J.Palma

http://www.idc.com/getdoc.jsp?containerId=prUS22777311


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Figure 12: Global Silicon Solar Cell Market Sizing, 2010 2013

0

5,000

10,000

15,000

20,000

25,000

2010

Revenue Average Selling Price

13,368

US$1.36

US$1.22

US$1.02US$0.92

14,569 17,877 20,285

2011 2012 2013

0

AverageSellingPriceinUS$

MW-

CellProduction

1.5

1

0.5


at double the rate from US$20billion in 2010 to US$39 billion in2014, on a global basis registering anaverage annual growth rate of almost20%. The recent surge in automotivesemiconductor demand is primarilydue to the growth in light vehicle

production in the emerging markets,particularly in China, Brazil, Russiaand India.

The rise of environmentally friendlyvehicles like hybrid electric andbattery electric cars is expected tocreate new revenue opportunities forsemiconductor suppliers. Productionof hybrid vehicles is expected toincrease from 3 million in 2010 to47 million in 2017. This will also

drive the power train industry, whichis forecasted to grow at a higherrate when compared to the overallsegment. Entertainment systems arealso expected to impact growth inautomotive semiconductors. In-vehicleentertainment systems are growingin complexity and functionality asconsumers demand a digital homeexperience in their cars.

Wireless Local Area Network

(WLAN) chipset market set

to outpace the average

semiconductor industry growth

According to iSuppli, WLANchipset shipments are projected to

reach 738.9 million units in 2011,representing a sharp growth of101.5% from 366.8 million units in2010. By 2014, chipset shipments areexpected to increase to more than 2billion units.

In addition to WLAN chipsets802.11n wi-fi standard, otheremerging connectivity technologiesare also gaining traction in the dailylives of consumers such as Wireless

Personal Area Networking (WPAN),which encompasses disparatetechnologies like Bluetooth and near-field communications. In both WLANand WPAN technologies, radio wavestransmit and exchange data over shortdistances between devices. Demandfor these technologies is growing dueto ease of use and increased interestin mobility.

Another connectivity technology,ZigBee, is trying to gain momentumin the home automation and smartutility monitoring applicationssegment. ZigBee is an IEEE 802.15.4standard for data communicationswith business and consumer devices.

It is designed around low-powerconsumption allowing batteries toessentially last forever.

The ZigBee standard providesnetwork, security and applicationsupport services operating on top ofthe IEEE 802.15.4 Medium AccessControl (MAC) and Physical Layer(PHY) wireless standard. ZigBeeis penetrating the next-generationautomated manufacturing industry

with small transmitters in everydevice on the floor, allowing forcommunication between devicesto a central computer. This newlevel of communication is creatingopportunities for remote monitoringand manipulation.

Source GTM Research, 2011


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Global solar power market

After registering substantial growth,the photovoltaic (PV) industry slowedfor a brief period in 2009 due to theglobal economic downturn. Sluggishdemand resulted in increasinginventory levels, ranging from raw

material silicon and PV cells tocomplete PV systems.

Massive capacity and limitedutilization pulled down the prices ofcrystalline silicon solar cells, panelsand modules in most of the markets.

According to Global Industry AnalystsInc. (GIA), this drop in prices wasalso attributable to a sharp declinein silicon prices to as low as US$50per kg. The falling prices, however,

ushered in a period of cost-effectivesolar systems, bringing down the costof entire PV systems.

However, the PV market reboundedquickly, backed by the economic

Key Takeaways

2010 was a rebound year for the overallsemiconductor market. After enduring considerable

challenges during the global recession of2008 2009, the semiconductor market segmentexperienced double-digit growth rates during 2010.

Semiconductor companies are exploring emergingtechnologies that will help them drive economiesof scale; some of the key focus areas forsemiconductor vendors are:

Investments in system-on-chip (SoC)design capability

Focusoncustomer-drivensolutions Reducesystemcostbyofferinghighly

integrated devices DevelopmentofIntellectualProperty

The top 10 players are Intel, Samsung Electronics,

Toshiba, Texas Instruments, STMicroelectronics,Renesas Electronics, Hynix Semiconductor, Micron

Technology, Qualcomm and Broadcom.

Decreased demand from solar power-generationfirms in European countries will reduce industryrevenue for solar panel manufacturers. In turn,these manufacturers will lower prices to meetslowing demand and seek out other markets inwhich to sell their products. Solar markets outsideof Europe (such as the US) lack generous subsidies.

As a result, relatively slow growth in these othersolar markets will also serve to lower panel prices.

The top 10 global solar cell manufacturers in 2010were First Solar, Suntech Power, Sharp, Q-Cells,

Yingli Green Energy, JA Solar, Kyocera, Trina Solar,SunPower and Gintech.

upturn in the developing countriesof Asia, including China and India,as well as industrial subsidy policiesacross most of the countries andthe expansionary monetary policyadopted by the central banks. Theincreasing prominence of Asia in thesector is primarily attributed to solar

cell production in China and Taiwan,which together accounted for 49%of the global solar cell productionin 2008. Going forward, the globalphotovoltaic market is poised forrobust growth, owing to the rapidadoption of solar energy acrossvarious regions.

In terms of production, Chinahas emerged as the worlds largestproducer of solar cells replacing

Japan, which had massive solarcell capacity worldwide until 2007.Chinese solar companies establishednew manufacturing facilities andinvested huge sums in productionfacilities since 2005, and emerged as

a strong market contender by 2008.Chinas solar cell output totaled2,278.6 MW in 2008, making it thenumber one producer in the world.

However, Chinese solar manufacturingcompanies have yet to move theirsurplus inventory created during the

recession. These companies over-produced solar panels in 2007 and2008 with the expectation that thesolar markets would thrive during2009. As a result, low-cost panelsare available, which in turn lowersthe up-front costs of solar powergeneration for customers. Panel priceshave fallen from the high range of$3.50 to $5.00 a watt during 2008 toan expected $1.36 per watt in 2011.

According to GTM Research, average

solar cell prices per watt are expectedto decrease from US$1.36/watt in2010 to US$0.92/watt in 2013. In2013, the global solar cell marketvalue is expected to reachUS$18.7 billion.


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Print and Imaging

Print and imaging market

Emerging markets continuedto outperform in the hardcopyperipherals space, growing at anaverage of 13% year-over-yearcompared to worldwide shipmentgrowth of 7.2% in the first quarter

of 2011 (1Q11). According to theInternational Data Corporation (IDC)6

Worldwide Quarterly HardcopyPeripherals Tracker, the worldwidehardcopy peripherals (HCP) marketrecorded more than 30 million unitshipments in the first quarter of2011. Similar to the last two quarters,monochrome laser led the pack interms of growth with close to 8.5million units shipped and 22% year-over-year growth.

IDC expects the earthquake andtsunami in Japan will have little to noimpact on the global imaging marketand that the negative impact will befelt more strongly for laser devicesthan for inkjet.

Technology highlights in the printand imaging market

Losing share to laser technology,inkjet registered at 63% of

overall shipments in 1Q11, down4 points from a year ago, whilelaser devices grew 3 points to33% share over the same periodin 1Q10. All regions except

Japan saw year-over-year growthin laser shipments with Asia/Pacific (excluding Japan)and Latin America (LA) seeingthe highest growth at 29% each.

1Q11 marked the fourth

consecutive quarter wheremonochrome laser surpassedcolor laser in terms of year-over-

year growth, with close to 8.5million units shipped producinga 22% gain. Monochrome laserprinters remain the dominanttype of laser in the office,accounting for 62% share of allmonochrome devices.

Vendor highlights

HP remains the undisputed leaderin the global HCP market with42.4% market share in 1Q11.The vendor grew 10.5%year-over-year, the secondhighest among the top 5 printand imaging players. With theexception of Japan, the vendorposted positive year-over-yeargrowth across all regions.

Canon continues to be a distantsecond-ranked vendor with17.4% market share and over5.3 million units shipped. Canonenjoyed an 11.3% year-over-yeargain, the highest among thetop 5, due to double-digitgrowth in emerging markets,including Asia/Pacific(excluding Japan), CentralEurope, Middle East, Africa(EMEA) and Latin America.

Epson continues to holdthe third place ranking with14.1% share and close to 4.4million units shipped. With theexception of Latin America and

Asia/Pacific (excluding Japan),Epson saw year-over-yeardeclines in unit shipments acrossall regions. Latin Americawas Epsons best performingregion with 27% year-over-year

growth, followed by Asia/Pacific(excluding Japan) with 2% growth.

6 IDC: Worldwide Quarterly PC Tracker, 6th June - 2011http://www.idc.com/getdoc.jsp?containerId=prUS22861211


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Samsung and Brother ended1Q11 in a statistical tie for thefourth position with shipmentsof roughly 1.8 million units andyear-over-year growth of 1.1%and 4.2%, respectively.

Imaging, digital cameras, high

definition and single-lens reflex

cameras (SLR)

The global economic downturnimpacted the digital imaging marketnegatively, with volume shipmentsdeclining significantly. The falloutwas also attributed to the fact thatcustomers are settling for low-marginmodels while manufacturers sought to

stimulate sales by reducing prices.

However, sales have been picking upsince late 2009 and early 2010, drivenby a strong demand for single lensreflex (SLR) cameras and robust

growth in emerging markets. Theincreased demand for touchscreenand high-definition (HD) cameras hasalso contributed to the rise in sales ofcompact digital cameras. But expertswarn that the impact on revenues

will come slowly, as customers arentyet prepared to invest in high-endor expensive models, which are themajor revenue drivers.

Regional highlights in imaging,digital cameras, high definition andsingle-lens reflex cameras (SLR)

According to new research conductedby Global Industry Analysts Inc., theUS, Asia Pacific and Europe together

accounted for the biggest share of themarket. Although the US, Europe,Middle East and Africa were hit thehardest by the economic downturn,the Asian market has displayed

Figure 13: Worldwide Hardcopy Peripherals Market Share and Growth Rates, 1Q 2011

Vendor1Q 2011

Unit Shipments

1Q 2011

Market Share

1Q 2010

Unit Shipments

1Q 2010

Market Share

1Q 2011/1Q 2010

Growth

HP

Canon

Epson

Samsung

Brother

Others

Total

13.1

5.3

4.4

1.8

1.8

4.4

30.7

42.4%

17.4%

14.1%

6.0%

5.8%

14.3%

100%

11.8

4.8

4.3

1.8

1.7

4.2

28.7

41.2%

16.7%

15.1%

6.3%

5.9%

14.7%

100%

10.5%

11.3%

0.3%

1.1%

4.2%

4.2%

7.2%

Allshipmentsareinmillionsofunits

18

Source http://www.idc.com/getdoc.jsp?containerId=prUS22888111


19/28


19

resilience, due to the relatively lowerlevels of saturation in the SLR market.

Going forward, Russia, China andIndia are expected to be the growthmarkets for manufacturers of digital

cameras. Purchase considerationswill hinge on consumers interest innew and novel technologies such astouchscreen user interface, HD video,wireless connectivity and advancedimage detection capabilities.

SLR cameras are the fastest-growingcategory of HD digital cameras, due tothe better quality of pictures. China,India and the Eastern Europeancountries are the fastest-growing

emerging markets, whereas growthhas been adversely affected in Japanand US markets. According tothe market research firm GfK, theMiddle East and Asia Pacific regionsexperienced growth of around 20%,while Eastern Europe grew byabout 19%.

Convergence of print andphotocopy machines

The global multi-function printers

(MFP) business developed from theconvergence of the printing andphotocopying machines industriesand experienced robust growth overthe last decade. The adoption oftechnologies enabled OEMs in bothindustries to streamline productionand consolidate the functions ofprinters and photocopy machinesinto a single unit. As a result in 2010,unit shipments of MFPs were 125.2million globally.

International compliance andmanaged print services

Environmental concerns and

accompanying activism have affectedthe procurement of parts and ledOEMs to develop products that areenergy efficient and that help reducethe industrys carbon footprint. TheEuropean Unions Restriction of

Hazardous Substances (RoHS) andRegistration, Evaluation, Authorisationand Restriction of Chemicals(REACH) have been particularlyinfluential.

In recent years there has been a trendamong Multi-function printers (MFP)Original Equipment manufactures(OEMs) to promote their ManagedPrint Services (MPS) instead of sellingMFP hardware. This trend is more

pronounced in mature markets suchas the United States and Europe.However, the OEMs have been tryingto expand MPS operations in thedeveloping markets in Asia. By 2013,MPS is expected to contribute up to

Multi-function printers (MFPs) willlead worldwide growth of printing

devices at the expense of single-function devices. This isattributable to the strong growthin emerging markets and to acertain extent Latin America.

Inkjet printers remain the largest-selling printing technology ascompared to laser printers.

HP, Canon and Epson are the topthree vendors with 42.4%, 17.4%and 14.1% market shares,

respectively, in 1Q 2011.

The economic downturn had anegative effect on the digital

imaging market, but saleshave been picking up slowly since

late 2009 and early 2010. Emerging markets are posting

strong growth led by SLRs,touchscreen and HD cameras.

However, this spurt in salesis unlikely to alter profitabilitysignificantly as customers arentwilling to invest in top-of-the-line,expensive models.

The printing and photocopier

industries have converged throughadoption of technologies byOEMs in both industries.

35% of revenues in the globalMFP industry.

Digital single-lens reflex cameras(DSLR) led growth in emergingmarkets

The digital camera market has growntremendously in recent years andthe Digital SLR cameras have beeninstrumental in driving this growth.Digital SLRs hold immense potentialin the future with their ease of usage,digitization, major innovations intechnology and growth in emergingmarkets.This will also have a positive effect on

accessories such as interchangeablelenses that are dedicated for SLRs.The market for interchangeable lensesis expected to grow as a result of therapid market penetration of digitalSLR cameras.

Key Takeaways


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Computers and Peripherals

Personal computers

According to IDC WorldwideQuarterly PC Tracker, 2Q2011,

Worldwide PC shipments increased2.6% in the second quarter of 2011

(2Q11). The results are just shortof IDCs May 2011 projections7 for2.9% growth, a letdown from theover 20% growth seen in H1 2010.This was primarily due to competitionfrom smartphones, other consumer

products and pressure from lacklustereconomic conditions.

The U.S. PC market continuedto contract in 2Q11, largely as aresult of three factors. The first isan ongoing contraction in the mininotebook (Netbook) market andrelated inventories. The second is theimpact of 2Q10s difficult-to-sustain12% growth. And third, demand hassoftened as corporate buyers continue

to focus on increasing share of theirIT budget in new IT solutions suchas cloud and virtualization, andconsumer interest shifts to mediatablets.

Figure 15: Hardcopy Peripherals Market Share and Growth Rates, 2Q 2010

Vendor2Q 2011

Shipments

2Q 2011

Market Share

2Q 2010

Shipments

2Q 2010

Market Share2Q 2011/2Q 2010

Growth

HP

Dell

Lenovo

Acer Group

ASUS

Others

Total

15,263

10,927

10,276

9,160

4,468

34,320

84,413

18.1%

12.9%

12.2%

10.9%

5.3%

40.7%

100%

14,823

10,626

8,363

10,190

4,216

34,070

82,289

18.0%

12.9%

10.2%

12.4%

5.1%

41.4%

100%

3.0%

2.8%

22.9%

-10.1%

6.0%

0.7%

2.6%


Figure 14: Market Share Worldwide

PC Shipments (by Region/Q2 2011)

Acer Group, 10.9%

Lenovo, 12.2%

Others, 40.7%

Toshiba, 5.3%

HP, 18.1%

Dell, 12.9%


Source: http://www.idc.com/getdoc.jsp?containerId=prUS22937811

7 IDC: Worldwide Quarterly PC Tracker, 6th June - 2011http://www.idc.com/getdoc.jsp?containerId=prUS22861211


21/2821


Regional highlights in personal

computers

United States:With a decline of4.2% year over year, the market wasstill downcast from a combination of

exuberant consumption a year agoand a tenuous economic recovery, butthe quarter also marked substantialgrowth from 1Q11, and totalshipments topped over 17.8 million.

Europe, Middle East, Africa(EMEA): The EMEA PC marketcontinued to contract in 2Q11, in linewith IDCs forecast, as sustained highlevels of inventory prevented strongersell-in, particularly in Western

Europe, where budget cannibalizationfrom media tablets and smartphonescontinued to contribute to weakconsumer demand and slow stockdepletion. However, Central andEastern Europe (CEE) and the Middle

East and Africa (MEA) continued toexpand and enjoyed positivegrowth overall.

Japan: The impact of the earthquakeon PC buying proved to be limited,

thus the market produced strongerresults than expected, with 3%growth. Many commercial projectscommenced as earlier fears ofinventory shortage did not materialize.Coupled with continued averageselling price (ASP) declines sincethe beginning of 2011, consumershipments also fared better thanexpected.

Asia/Pacific (excluding Japan):

The region returned to double-digitgrowth of just over 12% as the marketcame in slightly above forecasts. Aweak consumer market weighed downIndia, but other key markets likeChina continued their momentum to

help offset this, despite the ongoinginflation challenges there.

Server market

According to IDCs Worldwide

Quarterly Server Tracker, factoryrevenue in the worldwide servermarket increased 12.1% year overyear to $11.9 billion in the firstquarter of 2011 (1Q11). This is thefifth consecutive quarter of year-over-year revenue growth, as server marketdemand continued to improve aroundthe world. Server unit shipmentsincreased 2.5% year over year in1Q11 to 1.9 million units, which isthe second highest quarterly total ever

reported in the first calendar quarterof any year.

Improved market conditions wereseen across all three server classesvolume, midrange enterprise,

Figure 16: Worldwide Server Systems Factory Revenue, 1Q 2011

Vendor 1Q 2011

Revenue

1Q 2011

Market Share

1Q 2010

Revenue

1Q 2010

Market Share

1Q 2011/1Q 2010

Revenue Growth

HP

IBM

Dell

Oracle

Fujitsu

Others

Total

3,754

3,489

1,862

773

578

1,473

11,929

31.5%

29.2%

15.6%

6.5%

4.8%

12.3%

100%

3,387

2,857

1,697

681

685

1,332

10,639

31.8%

26.9%

16.0%

6.4%

6.4%

12.5%

100%

10.8%

22.1%

9.7%

13.6%

-15.6%

10.6%

12.1%




22/2822

and high-end enterprise. Volumesystems experienced an 8.7% year-over-year revenue increase, the sixthconsecutive quarter of positive growthfor the segment. Midrange enterprisedemand improved for the third time

in the past four quarters, with asharp 28.3% year-over-year revenueincrease. Finally, the improvingmarket conditions extended to thehigh-end enterprise segment, asquarterly revenue increased 14.2%when compared to 1Q10. This is thefirst time in eight quarters that allthree segments of the server markethave experienced a year-over-yearrevenue increase in the same quarter.

HP held the number 1 position in theworldwide server market with 31.5%factory revenue share for 1Q11. HPs10.8% revenue growth was led byimproved demand for both x86-based ProLiant servers and Itanium-based Integrity servers. IBM held thenumber 2 spot with 29.2% sharefor the quarter as factory revenueincreased 22.1% compared to 1Q10and gained 2.4 points of share from ayear ago.

Top technology findings

The market for non-x86 servers,including servers based on RISC,EPIC (Itanium-based), and CISCprocessors, increased 12.3%year over year to $4.0 billionin 1Q11. This is the secondconsecutive quarter in whichnon-x86 servers have exhibitedpositive growth and the firsttime in two years that non-x86

based system revenue has grownfaster than the market overall.Growth in non-x86 serverrevenue was driven by improveddemand for Unix servers andIBM System z platforms.

Unix servers experienced thefirst quarter showingyear-on-year factory revenueimprovement in 11 quarters,growing 12.5% when comparedto 1Q10. IBM, HP, and Oracle

all experienced improvementin Unix server revenue in thequarter, as worldwide Unixrevenues were $2.6 billion,representing 21.8% of quarterlyserver revenue.

IBMs System z servers runningz/OS experienced the thirdconsecutive quarter of positiverevenue growth, with 41.1%year-over-year growth in 1Q11

to $1.0 billion, representing8.8% of quarterly server revenueworldwide. This was the thirdconsecutive quarter that z/OSsystem revenue exceeded$1 billion.

Linux server demand increasedfor the sixth consecutive quarterin 1Q11, with revenue growing16.6% to $2.0 billion whencompared with the first quarterof 2010. Linux servers now

represent 16.9% of all serverrevenue, up 0.7 points over1Q10.

Microsoft Windows serverdemand also continued to showstrong demand as Windowsbased hardware revenueincreased 10.1% year-over-year. Quarterly revenue of $5.8billionfor Windows serversrepresented 48.5% of overall

quarterly factory revenue and75.2% of all quarterly servershipments.

x86 industry standard servermarket dynamics

Demand for x86 servers continuedto improve in 1Q11, with revenuesgrowing 12.0% in the quarter to $7.9

billion worldwide as unit shipmentsincreased 2.6% to 1.9 million servers.

HP led the market with 37.7%revenue share based on 11.6% growthover 1Q10. Dell retained secondplace, securing 23.5% revenue share,while IBM now holds 16.4% revenueshare.

Overall, 1Q11 was the eighthconsecutive quarter with year-over-

year increases in average sellingprices for x86 servers as both themix of systems and average systemconfigurations continue to moveup-market, driving generally higherproduct margin for x86 ecosystemplayers. Additionally, this was thesixth consecutive quarter of year-over-year factory revenue growth for x86servers with particular strength in

Asia/Pacific and Central and EasternEurope, the Middle East and Africa.

Bladed server market dynamics

The blade market continued its stronggrowth in the quarter with factoryrevenue increasing 23.8% year overyear, with shipment growth increasingby 5.4% compared to 1Q10. Overall,bladed servers, including x86, EPIC,and RISC blades, accounted for $1.8billion in revenues, representing15.2% of quarterly server marketrevenue. Nearly 90% of all blade

revenue is driven by x86-basedblades, which now represent 20.5% ofall x86 server revenue. HP maintainedthe number1 spot in the serverblade market in 1Q11 with 50.0%


23/2823


8, 9 Gartner, Inc.: Predicts 2011: Opportunities for Growth Still Exist in PC Market, Mikako Kitagawa, Annette Jump, Charles Smulders, Tracy Tsai & Angela McIntyre, 23 November 2010

10 Green IT Plans And Activities Persist In 2010 Despite Lack Of Formal Budgets And Priorities, Forrester Research Inc., July 27, 2010

Key Takeaways

According to IDC WorldwideQuarterly PC Tracker - 2Q2011,global PC shipments increased2.6% in second quarter 2011.

HP continues to be the marketleader with market share of18.1%.

The emerging markets arefacing the challenge ofincreasing inventory levelresulting in lower shipments.

Demand for x86 servers continuedto improve in 1Q11, withrevenues growing 12.0% in thequarter to $7.9 billion worldwide

as unit shipments increased 2.6%to 1.9 million servers.

Demand for Microsoft Windowsserver was high while UNIXserver revenue was relatively flatin 2010.

revenue share, while IBM finishedwith 20.2% revenue share. Ciscoand Dell rounded out the top 4 with9.4% and 8.4% factory revenue share,respectively.

Consumer segment to lead thePC business in mature markets

According to a Gartner Report8,the consumer segment has ledPC (desktop and mobile) and willcontinue to lead the growth in maturemarkets during the next five yearsas a growing number of householdsacquire multiple PCs.

According to the same report, In

the past five years, an ongoing pricedecline has led to increased consumerdemand for PCs in North Americaand Western Europe. In these regions,families have moved from having onePC in the household to multiple PCsper household. This is a significantchange. In 2006, consumersaccounted for only 40% of PCspurchased; in 2010, the consumershare will reach 54%. Consumersmodels are scaled down or low-specification PC models.

The Gartner report9 also highlightedAs consumers purchase theirsecond, third or fourth PC and buymultiple PCs for the household, thedesire for latest and greatest andfastest specifications will decrease.Opportunities for good enough andcommoditized products will increase,with good enough determined bythe usage model.

Green IT

Globally green IT is gaining immensetraction in the market. According toForrester10, 45% of IT organizationsare implementing or creating a green

IT strategy, with an additional 34%considering it.

As green IT continues to evolvefrom the concept of Green for ITto IT for green, the industrysinitial ongoing green IT efforts areset to shift from data center to otherinfrastructure like servers and PCs.

Adoption of desktop or servervirtualization will help enterprises

reduce energy footprints significantlythus saving operational costs perannum.

Personal computers will not be

personal anymore; they will be

shared computers

With an increasing number of usersopting for mobile PCs, the desk-

based PC market is set to undergo aparadigm shift. In the years to come,the market will evolve to a profitableniche segment with a unique formfactor. The all-in-one desktopconcept, a PC that will be integratedwith a monitor, is expected to grow inthe next five years, particularly in themature consumer market.

Users will select mobile PCs as aprimary device, and desk-based PCs

will remain as a hub system sharedby multiple users at home. For thisreason, the desk-based PC is not somuch a personal computer anymorebut a shared computer for a family.


24/2824

Enterprise Software

Enterprise Software

According to Forrester11, The totalmarket volume for software willincrease from $432.4 billion in2011 to $481.9 billion in 2012,representing 11.5% growth over

12 months. A number of trendswill drive this rapid growth,including cloud computing, smartcomputing, advanced analytics, andcollaboration.

The largest segment of the globalsoftware market is applications, whichwas estimated at $135.3 billion, or48.7%, of the market in 2010. This

figure is expected to reach $326.6billion in 2015, reflecting a 51%market share, and a CAGR of 10.7%during this period.

Middleware emerges as the secondfastest growing segment with a CAGR

of 10.2%, higher than the overallsoftware growth figure of 9.6% forthe period 2010 - 2015. In 2010, thesegment accounted for 32.7% shareof the market, or $132.4 billion, andis expected to rise to $214.8 billionin 2014, representing nearly 33.5% ofthe marketplace.

11 Foresights: The Software Market In Transformation, 2011 And Beyond, Forrester Research Inc., May 27, 2011

Source January 10, 2011, 2010 to 2012 Global Tech Industry Outlook Forrester report

Figure 17: Global Business and Government Purchases of Software

$0

$100

$200

$300

$400

$500

$600

$700

2005

$67.2

$135.3

$79.7

$20.4

$302.6Total

Applications built by consultantsand contractors

Applications built by consultants and contractors

Applications

Applications

Middleware

Middleware

Operating systems

Operating systems

2006

$68.1

$148.2

$88.7

$20.4

$325.5

2007

$67.1

$171.5

$99.6

$23.4

$361.5

2008

$64.0

$189.2

$117.8

$23.9

$395.0

2009

$52.9

$178.1

$118.8

$22.6

$372.5

2010

$49.3

$196.7

$132.4

$25.9

$404.3

2011

$43.5

$213.4

$147.9

$27.6

$432.4

2012

$50.9

$237.5

$163.9

$29.6

$481.9

2013

$59.0

$265.6

$163.9

$31.3

$536.2

2014

$62.7

$296.6

$198.9

$32.9

$591.1

2015

$64.8

$326.6

$214.8

$34.2

$640.5

Softwa

rePurchasesinbillionsofUS$


25/28


25

Finally, operating system remains tobe an important space for vendors tohave a strong presence. This segmentwill remain at an approximatebetween 5% and 6% of the totalmarket until 2015, although growingfrom $25.9 billion in 2010 to $34.2

billion in 2015, representing a CAGRof 5.7%.

The Forrester12 report also highlightedWith ongoing operational costseating up a major part of corporateIT budgets, there is usually very littleleft for organizations to spend on newinitiatives or true innovation.

Cloud computing to evolve over

the next few years

Cloud computing is a result of theevolution of how software andservices are delivered to enterprises,over the past 15 years, and acontinuing trend toward theindustrialization of IT. This is, in part,due to the popularity of outsourcingand hosting of increasinglyindustrialized service definitions, coststructures, and pricing. The cloudcomputing model is enabled by theongoing standardization of underlying

technologies like virtualization,service-oriented architecture (SOA),and Web 2.0.

Over the next few years, the deliverymodels of software will transformfrom the fundamental concepts ofon-premise to just-in-time, pay-per-use, abstracted and simplifiedresources, and composite applications.Customers will be interested in lesscost, more availability and agility, as

well as managed risk.

Hybrid software landscape to

emerge

In the near future, both on-premiseand on-demand models will continueto co-exist in the market, effectivelyleading to an environment of hybrid

software landscapes that need to beintegrated by vendors. The hybridapproach will also create additionalservices and options for enterpriseswilling to maintain their existinginfrastructure but want to use servicesin the cloud to help them boostsecurity and maximize their existingset-up.

Collaborative analytics will

transform the business

intelligence space

A combination of market forces iscreating a new set of challenges forenterprises all sizes. These challengesare making it imperative to providegreater access to real-time dataand insights. Legacy BI tools arenot becoming able to support andmeet expectations of an increasinglydispersed sales team. Even withthe data traditional BI tools madeavailable, distribution via file

servers and email impeded effectiveconversations and collaborationaround what the data showed.

Collaborative analytics describesthe process of users engaged ina collaborative and iterative goalseeking approach to problem solving.It is a mesh of reporting, analytics,workflow and collaboration servicesthat aids knowledge workers decisionproductivity. Collaborative analytics

will continue to evolve and graduallyget embedded as part of the businessintelligence solution portfolio.

Key Takeaways

The total market volume forsoftware will increase from$432.4 billion in 2011 to$640.5 billion in 2012,representing 9.6% growth

over next 5 years.

Cloud computing, smartcomputing, advancedanalytics and collaborationare expected to gain tractionin the market.

12 Foresights: The Software Market In Transformation, 2011 And Beyond, Forrester Research Inc., May 27, 2011


26/2826

Conclusion

The fast-paced global high techindustry is not without its own distinctand complex challenges. Every playerin the industry is striving to gain andmaintain competitive differentiationby adopting new approaches or by

realizing latent sources of success inexisting operations. However, whileeach of the sub-segments faces specificchallenges, smart high tech companiesshould embrace four key strategies inorder to thrive:

Contain costs; its essential: Lackingshort-term ways to stimulate demandand sales growth, many companiesremain focused on preserving theirbottom lines by holding down costs.

Deliver top-notch customer service:High tech companies have donewhat they can during the downturnto satisfy the customer even whenservice and cost are competingpriorities.

Respond quickly to changes insupply or demand:For years, manyhigh tech firms focused on forecastingbut lacked adaptability or flexibility iftheir assumptions turned out to

be wrong.

Focus on product development; itmatters more than ever: High techcompanies are intent on getting theirinternal houses in order, focusing oncore capabilities and core markets.

In this increasingly competitiveenvironment high tech companiesmore than ever must excel in keystrategic areas by taking the

following actions:

Shift from products to services:Most high tech companies are makinga shift from a product-based model

to a services-based model. Thecompanies that provide excellentservice to their customers will be theones that will stand tall in the future.

Rapid product innovation: Rapid

innovation and faster time-to-marketare key business success factorsfor manufacturing organizations.Solutions in this area can helpcompanies implement product andplan changes faster and morecost efficiently.

Operational excellence: Optimizeand harmonize global supply chain,rationalize the supplier base andundertake integrated business

and inventory planning. Globalharmonization programs address thesechallenges and help manufacturersachieve a reduced operationalcost basis.

Reduce cost without compromisingon the quality: Cost reductiontechniques can help manufacturingcompanies improve their bottomline. This can be done by offshoringof the manufacturing processes tolow-cost countries. Business Process

Outsourcing and/or co-sourcingapproaches also help drivesignificant cost reduction and enablemanufacturers to focus on theircore activities.

This report gives an overview of keytrends in the high tech sub-segments.There are many techniques andtools that can be applied to yourorganization to make you standtall in the market. For additional

information about how Capgeminican help you address the trends andchallenges, please visit our high techpractice website at:www.capgemini.com/high-tech
http://www.capgemini.com/services-and-solutions/by-industry/high-tech/overview/http://www.capgemini.com/services-and-solutions/by-industry/high-tech/overview/


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27

With 115,000 people in

40 countries, Capgemini is

one of the worlds foremost

providers of consulting, technology and

outsourcing services. The Group reported

2010 global revenues of EUR 8.7 billion

Together with its clients, Capgemini creates

and delivers business and technology

solutions that fit their needs and drive the

results they want.

A deeply multicultural organization,

Capgemini has developed its own way of

working, the Collaborative Business

ExperienceTM, and draws on Rightshore, its

worldwide delivery model.

More information is available at

www.capgemini.com

About Capgemini


28/28

www.capgemini.com/high-tech

Rightshore

is a registered trademark belonging to Capgemini. The information contained inthis document is proprietary. Copyright 2011 Capgemini. All rights reserved.

For more information please contact:

Guido Kamann

+ 49 (0)151 4025 2115

[email protected]

Nick Gill

+ 44 (0)870 904 5699

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Avishek Sen

+91 9619631525

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Documents

The Changing Dynamics of the Global High Tech Industry an Analysis of Key Segments and Trends