DUBLIN – Research and Markets (http://www.researchandmarkets.com/research/ea56ab/thailand_informati) has announced the addition of the "Thailand Information Technology Report Q4 2010" report to their offering.
Thailand 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 Thailand’s information technology industry.
The Thai IT market is the largest in South East Asia and, despite ongoing political uncertainty, is projected to grow at a CAGR of 13% over the 2010-2014 period. The total value of Thai domestic spending on IT products and services should pass US$5.6bn in 2010 and approach US$9.1bn by 2014. In H210, growth is expected to accelerate, with a boost from students at the start of the new university year, as well as an uptick in corporate and office sales.
The Thailand market made a fairly rapid recovery towards the end of Q210 from the political turmoil that had disrupted sales earlier in the year. In many cases, demand started to start to pick up again from late May and the first week in June. The political crisis had an impact on consumer IT demand, particularly in Bangkok, with sales down by around 15% in March, following strong growth in the first two months of the year.
BMI’s view is that the fundamentals of growing affordability and low PC penetration, supported by government ICT initiatives, will keep the market in positive territory during the forecast period. There are a number of drivers, including a Government PC for Education programme, launched in H209. Other positive factors include 3G mobile and WiMAX broadband service roll-outs, and aggressive vendor and channel promotions.
The political crisis in Bangkok and other major cities in H110 had an impact on consumer IT demand, particularly in Bangkok, which accounts for around half of national consumer IT spending. Retailers in Pratunam’s Pantip Plaza and Ratchaprasong district, which together account for more than 30% of the IT business in Bangkok, reported a drop in sales of around 15% in March 2010, as the political crisis worsened. Government and business demand held up relatively well, but during the troubles some vendors reported that their customers were delaying IT purchase decisions by one or two months.
In 2009, Thailand’s government outlined a number of projects to help close the digital divide. One potentially significant initiative from the ICT Ministry is to offer a special tax reduction to companies that donate their used computers to local communities. Meanwhile, the government also revealed plans to offer computers, as well as software applications, bundled with broadband services from government telecoms operators CAT and TOT. The Ministry of ICT is currently negotiating with state-owned banks to offer special loans to users who participate in the programme.
The Thai government has announced an ambitious target to increase the local software market share of Thai software companies to 40% this year, and 50% in 2010. The Thai government has announced a series of measures to support the local software industry. SIPA (Software Industry Promotion Agency) has led ‘Buy Thai First’ campaigns to persuade local small and medium-sized enterprises (SMEs) to buy Thai developed software and has lobbied the government to endorse tax incentives for local developers.
In mid-2010, most vendors reported a strong upturn in sales following the political disruptions earlier in the year. Toshiba said that sales volume started to recover from late May, and the company estimated that its overall Thailand business had grown 10%-20% in H110. However, Lenovo, PC market leader in the wider Asian region due to its strength in China, said that it anticipated 300% growth in the Thai market this year.
In 2009, Acer achieved the number one spot in the Thai PC market, with 18% growth over 2008. Meanwhile, in 2010, Dell plans to at least double its revenues from the consumer segment in Thailand and said that it will continue to invest aggressively in the local market. The company plans to double its marketing budget in 2010 and build on its cooperation with Thailand’s largest IT superstore, IT City, expanding to more than 2,000 retail outlets by the end of 2010.
As business demand appeared to pick in H110, vendors were planning to invest to expand the enterprise software market. Global enterprise resource planning (ERP) software leader SAP wants to triple its local market share by 2010, based on its core ERP software. Meanwhile, US rival Oracle said that it will focus more on the mid-sized sector in 2010, targeting companies that wish to take a step up to professional software from ad-hoc use of Excel and custom programs. Enterprise software specialist SAS Software Thailand has announced a target to more than triple its local business and workforce within the next three years.
According to BMI projections, Thailand’s PC market will be worth around US$3.8bn in 2010, up from an estimated US$3.2bn in 2009. In 2010 the consumer segment is expected to continue its dominance and comprise nearly two-thirds of the market. Strong demand from the consumer PC segment was the main PC market driver in 2009. PC penetration of around 15% represents considerable latent growth potential, and total hardware revenues including notebooks and desktops are expected to rise to US$5.7bn 2014. The Thai PC market has become more mature, with greater segmentation apparent. There remains a first buyer market for desktops, particularly in large provincial cities such as Chiang Mai and Hat Yan.
However, even first-time buyers have higher expectations concerning functionality and performance. In 2009, desktops recorded flat or slightly negative growth, due to the economic situation. The main driver of the computer market will be notebooks, and netbook sales may drop below 7% of total notebook sales in 2010.
In 2010, Thai software sales are projected by BMI at US$620mn, despite the uncertain economic conditions, and software CAGR from 2010-2014 should be in the region of 15%. With the economic and political crisis having an impact in both public and private sectors, some vendors and their local partners saw a slowdown in some businesses in 2009.
However, growing PC penetration, and new technologies and business models, including 3G mobile and WiMAX, and industry trends, such as software-as-a-service (SaaS), Green IT and virtualisation, will represent growth areas, and there is a growing emphasis on cost efficiency as enterprises look to enhance productivity through automating these and other functions. Thailand’s software market is developing, despite the problem of software piracy, which still accounts for around 76% of software.
IT services spending is forecast to reach around US$1.2bn in 2010, up from US$1.1bn in 2009. The economic crisis and political uncertainty had an impact in 2009, with projects being put on hold. However, sectoral CAGR is projected at 16% over the forecast period, as the market passes US$2.3bn by 2014.
IT services accounts for around 22% of total IT spending. Over the past few years, deal size has increased in key verticals such as banking and telecoms. Despite the financial crisis, some elements of bank spending will be relatively immune, particularly those driven by regulatory compliance. Meanwhile, telecoms is another big spending IT vertical, with mobile operators investing to expand capacity and roll out new services.
Thailand internet penetration is set to pass 17% within BMI’s five-year forecast period, from around 16% in 2008. Broadband penetration will grow to 6.6% in 2014 from 2.3% in 2009, according to BMI estimates.
By 2009, the Thailand Internet Service Provider Association predicted that Thailand could see between 5mn and 10mn broadband subscribers, although BMI has opted for a more conservative estimate of 1.5mn subscribers. The level of growth set to be experienced in the broadband sector will also be fuelled by the award of WiMAX licences.
Key Topics Covered:
- Executive Summary
- SWOT Analysis
- IT Business Environment Ratings
- Asia IT Business Environment Ratings
- Table: Asia Pacific IT Business Environment Ratings
- Asia Regional IT Markets Overview
- IT Penetration
- IT Growth And Drivers
- Sectors and Verticals
- Thailand Market Overview
- Industry Forecast Scenario
- Thailand, IT Sector
- Table: Telecoms Sector – Internet – Historical Data And Forecasts
- Macroeconomic Forecast
- Thailand Economic Activity
- Competitive Landscape
- IT Services
- Wireline (Fixed-Line And Broadband) Developments
- Table: Wireline Developments, 2008-2009
- Company Profiles
- Microsoft Thailand
- Hana Microelectronics