Sustainable Growth For China's
Telecom Industry Solutions September
In 1H 2008,
China's telecom industry solutions market reached 9.92 billion Yuan, up 8.3%
YOY. CCID Consulting projects revenues will break through 20 billion Yuan by
the end of 2008, up 7.1% YOY. CCID Consulting defines "telecom industry
solutions" as telecom operators, equipment vendors, and systems integrators
that provide telecom solutions and services.
consulting, July 2008
Government and financial services
sectors had the largest demand.
China's government sector in 1H08 was the
largest with a spend share of 19.6%. Several factors drive spending. First,
the government is transforming itself into a service-oriented one, which
will drive increased ICT (information and communications technology)
investments. Second, there is a focus on more rural governments in China's
Tier 3 and 4 cities, which will offer more potential than the urban Tier 1
and 2 cities. Finally, China's overall tax revenues in 2007 was nearly 5
trillion Yuan, up 30% over 2006, which provides a solid base for increased ICT investment.
The second largest sector is financial
services, at a spend share of 18.3%. The focus on telecom industry solutions
spend will be on further expansion and refinement of existing financial
services, such as online banking and mobile phone securities monitoring and
Government and financial services tend to
lead China's overall telecom industry solutions adoption and spend. As such
solutions become more mature, other industries follow. Education, logistics,
electric power, coal, and petroleum round out the top seven in terms of
telecom industry solutions spend in 1H08.
Telecom industry solutions expand to
In 1H08, the two major categories of
telecom industry solutions are call centers and video conferencing. These
categories are expanding into China's SMEs (small and medium enterprises).
Large scale call center solutions, such as
those for telecom and banking, are nearing completion. Future demand for
such call centers will be in the form of systems upgrades, increasing
capacity, and systems transformation. As call center solutions for
securities, insurance, computer, consumer appliance, manufacturing, tourism,
logistics, retail, and e-commerce near completion, CCID Consulting expects
the next wave of demand to come from SMEs. In the next five years, for
example, CCID Consulting forecasts SME call center CTI equipment spend to
have a growth rate of 23%.
For video conferencing, China's
enterprises, large and small, are realizing the benefits of real-time
communications and resulting efficiencies. China's 11 million SMEs are
becoming new hotspot for video conferencing. However, unlike government and
large enterprise applications which are sophisticated with technician
support, SMEs video conferencing require leverage of existing, and more
limited, IT and communications resources. Small scale video conferencing and
service-oriented models will be the mode for SMEs.
The telecom restructuring will enable more
growth for telecom industry solutions. One of the goals of the restructuring
is to foster China's 3G development and arrival. 3G offers larger capacities
and better communications quality than 2G and 2.5G. The 3G vision is to
enable users to realize seamless voice, data, and multimedia. For
businesses, users will realize the fully mobile office, with mobile
positioning and long distance access and control.
The competition of the three, more
resource rich telecom operators will spur better telecom industry solutions.
For example, newly restructured
China Telecom has existing strengths in the
commercial sector, but it would like to compete for the individual user, it
must provide better services and infrastructure, thereby driving higher
levels of telecom industry solutions.
For more information
contact us for these and
other China-related data, information and products.
Unless otherwise specified,
all information provided is sourced from CCID Consulting.