27.07.2016, 14:11
South Korea Information Technology Report Q3 2016
OREANDA-NEWS. RnR Market Research Offers Report by Research on South Korea Information Technology Report Q3 2016
BMI View: South Korea is a world leader in the production of IT hardware, and the software & services industry is developing rapidly and has exposure to key growth areas. The spending outlook is relatively strong for a developed market, particularly for software & services where a high-value enterprise mix, a broad ecosystem of ICT vendors and a conducive policy environment will be important drivers. The hardware outlook is more mixed due to the maturity of the PC market and potential for retail spending cannibalisation by mobile devices, but our positive forecast for premium household income growth offsets some of this drag. We forecast total IT spending will increase at a CAGR of 5.1% over 2016-2020.
Latest Updates & Industry Developments
- Computer Hardware Sales: KRW11.4trn in 2016 to KRW13.2trn in 2020, a compound annual growth rate (CAGR) of 3.8%. There is pent-up demand after contraction over 2013-2015 and premium income gains are another positive, but there is downside from potential PC sales cannibalisation by smartphones.
- Software Sales: KRW6.4trn in 2016 to KRW8.1trn in 2020, a CAGR of 6.0%. Key verticals such as financial services and the government are expected to increase spending, particularly on advanced solutions.
- IT Services Sales: KRW8.8trn in 2016 to KRW11.1trn in 2020, a CAGR of 6.2%. Government and private sector initiatives, along with high quality network infrastructure, mean South Korea is positioned well for cloud computing and Internet of Things growth.
BMI View: South Korea is a world leader in the production of IT hardware, and the software & services industry is developing rapidly and has exposure to key growth areas. The spending outlook is relatively strong for a developed market, particularly for software & services where a high-value enterprise mix, a broad ecosystem of ICT vendors and a conducive policy environment will be important drivers. The hardware outlook is more mixed due to the maturity of the PC market and potential for retail spending cannibalisation by mobile devices, but our positive forecast for premium household income growth offsets some of this drag. We forecast total IT spending will increase at a CAGR of 5.1% over 2016-2020.
Latest Updates & Industry Developments
- Computer Hardware Sales: KRW11.4trn in 2016 to KRW13.2trn in 2020, a compound annual growth rate (CAGR) of 3.8%. There is pent-up demand after contraction over 2013-2015 and premium income gains are another positive, but there is downside from potential PC sales cannibalisation by smartphones.
- Software Sales: KRW6.4trn in 2016 to KRW8.1trn in 2020, a CAGR of 6.0%. Key verticals such as financial services and the government are expected to increase spending, particularly on advanced solutions.
- IT Services Sales: KRW8.8trn in 2016 to KRW11.1trn in 2020, a CAGR of 6.2%. Government and private sector initiatives, along with high quality network infrastructure, mean South Korea is positioned well for cloud computing and Internet of Things growth.
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