Research firm IDC revealed the ICT spending forecast for 2018 — sharing insights for mobile service providers and telecom network equipment makers.
Consumers and enterprises will be spending $1.5 trillion on telecommunications services — with fixed and mobile telecom services receiving 95 percent. This trend indicates that mobile operators need to continue their investment and focus on both fixed and mobile services.
Enterprises and consumers will be spending nearly $500 billion for mobile phones this year. The spending on mobile data and mobile voice will be more than $400 billion each. Most of the global telecom operators are spending heavily on mobile data infrastructure to arrest falling revenue from voice services.
Consumers will dominate the telecom services related spending. This shows that CMOs of mobile operators need to continue their focus on consumer market to retain their subscribers and grow business revenue from services.
Business leaders at mobile operators can finalize their enterprise strategy considering the fact that some industries are spending heavily on fixed and mobile data services. In Asia, special projects and initiatives have helped to boost fixed broadband adoption in the education sector.
The healthcare industry in the US is a major source of fixed-line telecom spending, while transportation firms in Canada and Japan have invested aggressively in mobile broadband solutions.
“Consumers in many emerging markets continue to leapfrog fixed broadband and go straight to mobile data services, which is changing the entire landscape for how to connect with end-users in these countries,” said Stephen Minton, research vice president, Customer Insights & Analysis.
Spending on ICT by consumers and enterprises will be nearly $4 trillion in 2018. Telecom industry will be spending $85 billion on infrastructure. The IDC report did not reveal more details of telecom infrastructure spending that can give more insights to CTOs and other decision makers.
Telecom infrastructure companies such as Huawei, Ericsson, Nokia, Cisco, among others, will be looking for more deals in the mobile operator market.
Consumer spending on smartphones will account for the largest proportion of ICT spending this year. The growth driver for ICT spending will be enterprise spending on cloud, software and infrastructure, according to IDC.
The consumer ICT spending will be more than $1.5 trillion in 2018. Consumer spending will experience the slowest growth over the forecast period with a CAGR of 1.2 percent. Roughly 80 percent of consumer spending will go to devices and mobile telecom services.
Industries such as banking, discrete manufacturing, telecommunications, and professional services will be spending more than $900 billion, making it the four largest industries for ICT spending in 2018.
Banking, discrete manufacturing, telecommunications, and professional services will invest heavily in applications, infrastructure, outsourcing, and telecom services. Banking will invest $115 billion in IT outsourcing and project-oriented outsourcing.
Professional services and banking will experience the fastest growth in ICT spending with five-year CAGRs or 5.9 percent and 5.2 percent, respectively.
The IDC report said small office category with businesses with 1-9 employees will account for 7 percent all ICT spending. Most of this spending at around $100 billion per year will go toward fixed and mobile telecom services, while devices will also be a significant spending category.
IDC said very large businesses with more than 1,000 employees will account for more than 50 percent of all ICT spending — focusing on IT outsourcing, project-oriented outsourcing, applications, and infrastructure as they pursue their digital transformation strategy. This shows that their spending on telecom will be comparatively smaller than other ICT areas for the year.
The telecom research report said medium enterprises with 100-499 employees and large enterprises with 500-999 employees businesses will experience more balanced spending across all technology categories.
Spending on IT will reach $2.16 trillion this year, led by business and consumer spending on devices, applications, IT outsourcing, and project-oriented outsourcing, including application development and system and network implementation.
More than $300 billion will be spent on business process outsourcing and business consulting services this year.
