high-level seminar on e- communications the development of the ict sector during the crisis:...
TRANSCRIPT
High-Level Seminar on E-Communications
The development of the ICT sector during the crisis: International comparisons
Information Technology Outlook
Graham Vickery, OECD Prague16 April 2009
Outline
• What is the impact of the crisis on the ICT sector?
• How does it compare with other sectors?
• How does the crisis (so far) compare with the previous ones?
• What are economic implications?
• What are implications for policy?
Global overview: ICT supply side• Rapid drop in ICT production linked with Q3-Q4 financial
markets meltdown and global recession. But 2008 positive overall due to Q1-Q3 growth. Negative for 2009• Goods: US and Europe down. Asian countries collapsed.
• Services: Slowing but not collapsing. Questions for 2009, e.g. India services sourcing
• Turbulence with recession: IT investment is very cyclical (‘accelerator effect’ – telecommunications and business CAPEX dropping), personal consumption including services hit by ‘wealth effect’, unemployment
• 2007 – mid-2008. Growth balanced in OECD countries. E. Europe and non-OECD have grown much faster
– ICT markets: Non-OECD countries (Russia, India, China) took 23 of top 25 market growth positions 2000-2007. OECD share down 2003 85% => 2007 78%
• Drivers shifted from technology push => commercial and user-driven applications pull
3
ICT sector opportunities and threatsOpportunities Threats
Short- medium-term
Restructuring and efficiencies
ICT budgets hard to compress
Restructuring in other sectors - more use of ICTs / outsourcing
Public sector and emerging economies continue to invest
Economic stimulus packages
Declines in R&D and innovation
Decreasing access to capital / VC
IT budgets plunge all sectors / regions
Consumer ICT spending plummets
Fall in demand from emerging economies
Longer-term
R&D and innovation priorities
Growth in digital content
Green IT, health & aging drivers
Consolidation / globalisation of back-office / information management
Spending on ICT security up
Long term stimulus packages
Dropping R&D / innovation priorities
Prolonged financing problems
Slow development new business models
Slow supply of ICT professionals skills
Business / consumer spending falls
Prolonged infrastructure underinvestment
Effects on low-cost locations
Semiconductors falling. Asia gaining shareSemiconductor market by region, 1990-2009. Current USD billion
USD billions, current prices
Source: Information Technology Outlook 2008. 2008 partly estimated, 2009 projected from SIA data.
5
0
50
100
150
200
250
300
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Americas Japan Europe Asia Pacific
6
Utilisation rate of semiconductor manufacturing facilities In percentages
Utilisation semiconductor manufacturing
The challenge: ICT goods plunging with the economic crisis – Japan
December 1999–January 2009. Year-on-year % change, volume index, seasonally adjusted, 3-month moving average
Source: Information Technology Outlook database.
-50
-40
-30
-20
-10
0
10
20
30
40
50
Dec-99
Jun-00
Dec-00
Jun-01
Dec-01
Jun-02
Dec-02
Jun-03
Dec-03
Jun-04
Dec-04
Jun-05
Dec-05
Jun-06
Dec-06
Jun-07
Dec-07
Jun-08
Dec-08
Manufacturing Inform and Comm Electron. equip Electronics parts Motor Vehicles Chemicals
IT equipment
Electronics parts
Motor Vehicles
Chemicals
Manufacturing
… but ICT services holding up - JapanYear-on-year % change, production indices, seasonally adjusted, 3-month moving average
Source: Information Technology Outlook database.
-10
-5
0
5
10
15
20
De
c-98
Jun-9
9
De
c-99
Jun-0
0
De
c-00
Jun-0
1
De
c-01
Jun-0
2
De
c-02
Jun-0
3
De
c-03
Jun-0
4
De
c-04
Jun-0
5
De
c-05
Jun-0
6
De
c-06
Jun-0
7
De
c-07
Jun-0
8
De
c-08
IT services Telecomms Computer related activities
Collapse is worse in automobiles - France December 1995 – December 2008. Year on year % change, volume index, seasonally
adjusted, 3-month moving average
Source: Information Technology Outlook database.
-50
-40
-30
-20
-10
0
10
20
30
40
50
De
c-95
Jun
-96
De
c-96
Jun
-97
De
c-97
Jun
-98
De
c-98
Jun
-99
De
c-99
Jun
-00
De
c-00
Jun
-01
De
c-01
Jun
-02
De
c-02
Jun
-03
De
c-03
Jun
-04
De
c-04
Jun
-05
De
c-05
Jun
-06
De
c-06
Jun
-07
De
c-07
Jun
-08
De
c-08
Computer and Office Machinery Electronic components Motor vehicles & parts
Chemicals, plastic, rubber Manufacturing
Chemicals
Motor vehicles
… and in the United States – employmentDecember 2001–January 2009. Year-on-year % change, number of employees,
seasonally adj. 3-month moving average
Source: Information Technology Outlook database.
-25
-20
-15
-10
-5
0
5
10
Dec-00
Jun-01
Dec-01
Jun-02
Dec-02
Jun-03
Dec-03
Jun-04
Dec-04
Jun-05
Dec-05
Jun-06
Dec-06
Jun-07
Dec-07
Jun-08
Dec-08
Manufacturing Computer & electronics Motor vehicles Chemicals
Global firms: crisis tough for IT equipment Quarterly revenue growth (year-on-year) , Top-10 “IT equipment”
11
Revenues grew most of the year, Q4 decline greater than revenue declines in 2001 for same companies. Overall revenue drops same in both periods.
Source: OECD calculations for top-10 IT equipment firms from OECD top-250 ICT firms.
Still relatively good for IT services ..
12
Quarterly revenue growth (year on year), Top-10 “IT services”
Note: Average growth refers to non-weighted average of firms’ annual growth rates.
Top firms maintained growth through 2008, Q4 slowed a little. Driven by IT and Business Process Outsourcing (ITO/BPO) but financial market crisis slowing demand. Outsourcing revenue growth to decline in 2009?
Source: OECD calculations for top-10 IT services firms from OECD top 250 ICT firms.
.. and software
13
Quarterly revenue growth (year on year), Top-10 “Software”
Note: Average growth refers to non-weighted average of firms’ annual growth rates.
Top software firms high growth Q1-Q2, dropped in Q3-Q4. Driven by business and consumer investment.
Source: OECD calculations for top 10 software firms from OECD top 250 ICT firms.
China’s lead in ICT goods exports By region 1996-2007, USD current prices billions
Source: OECD Information Technology Outlook, 2008. 14
0
50
100
150
200
250
300
350
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Imports of ICT goods
United States EU-15 China Japan Korea
0
50
100
150
200
250
300
350
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Exports of ICT goods
United States EU-15 China Japan Korea
Services trade and cross-border investment• Trade in ICT services: growing strongly
– IT services growing 15-20% p.a. – Ireland by far largest OECD exporter: 2007 USD 21 billion,
surplus USD 20 billion – UK, US and Germany each around USD 10 billion exports– India largest world exporter: 2006 USD 30 billion, surplus
USD 27 billion; 2007 and 2008 around USD 40 billion; 2009?
• High ICT and comms services share of FDI and M&As: Business cycle collapse– Shift to E. Europe and non-OECD. Non-OECD M&A investment
has been up in numbers, less in values– 2008 down sharply. 2009 even more
15
ICT specialists growing rapidly in most countriesShare of ICT specialist occupations in total employment,1995 and 2007
Source: OECD Information Technology Outlook, 2008.
Classifications not harmonised: shares for European and non-European countries are not directly comparable.16
0
1
2
3
4
5
1995 2007%
Government ICT policy priorities 2008:The right policies for crisis and recovery?
1. Government online, government as model users
2. Broadband
3. ICT R&D programmes
4. Promoting IT education
5. Technology diffusion to businesses
6. Technology diffusion to households
7. Industry-based and on-the-job training
8. General digital content development
9. Public sector information and content
10. ICT innovation support
Source: Information Technology Outlook 2008.