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IDC: Southeast Asia beams with bright telecom market

Posted: 03 Apr 2009 ?? ?Print Version ?Bookmark and Share

Keywords:market telecommunication? Southeast Asia? market prediction telecom?

Despite the global economic slowdown, the telecom market in Southeast Asia, which includes Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, will remain resilient in 2009, according to a prediction by International Data Corp. (IDC). While market players and end users will exercise extra caution in their spending on telecom products and services, certain technology areas will sustain momentum and pockets of opportunities will emerge from the crisis.

"The global economy heavily influences IDC's predictions for 2009 of the Southeast Asian telecom markets," said Karen Rondon, research manager of communications research at IDC. "The global downturn will impact many telecoms sectors. Nonetheless, IDC sees bright spots in the Southeast Asian telecom market that will yield great opportunities for both market players and end users in 2009."

The following are IDC's 2009 predictions for the telecommunications market in Southeast Asia.

? Southeast Asia's telecom spending will remain resilient in 2009.!IDC projects the combined telecom services market of Indonesia, Malaysia, the Philippines, Singapore and Thailand to reach $35.7 billion in 2009, which is 10 percent higher than its 2008 performance. Telecom services encompass mobile services, Internet access services, corporate data services and fixed telephony.

Malaysia, the Philippines, Singapore and Thailand are expected to show modest growth at a 4 percent to 6 percent range. Vietnam and Indonesia!each expecting double-digit expansion rates!will be the higher-growth markets as they are at the early stages of the technology adoption curve and currently addressing the digital divide in their markets.

? Telecom operators will rethink strategies in the downturn and prepare for the upswing!The global economic slowdown will affect Southeast Asia's telecom sector, but to a lesser extent than the IT markets. IDC anticipates that telecom market players in this region will be reassessing their strategies and reconsidering capex plans, marketing strategies and product focus.

Incumbents with healthy balance sheets will be able to focus capex on enhancing core and backhaul networks and be farther ahead of their competitors once the economy recovers. Consumers or enterprise tier two operators, on the other hand, will have to focus on investments that will see faster returns. Meanwhile, the economic situation will present opportunities for operators with facilities and funds available to begin diversifying into higher value consumer and business services.

? SME 2.0: Small and medium-sized enterprises to become the main focus of incumbent service providers!IDC anticipates renewed interest among Southeast Asian telecom incumbents in the small and medium-sized enterprise (SME) segment that will bring forth the second wave of SME-centric marketing and product development initiatives by these players.

The financial crisis will dampen any prospects of growth within the large corporations in 2009 and possibly in 2010 as well. Any recovery that happens is always through the SME sector first. Hence, 2009 will be a good time for incumbents to invest in marketing of products and services targeted to the SME segment.

? Affordable alternatives will be on the rise!With the tightening of budgets, IDC expects that end users will seek alternative telecoms devices and services in 2009. The selection of what is affordable and beneficial may range from choosing the better service option to picking out the more practical telecom products and services.

Broadband and mobile subscribers will find affordable ways to stay connected. Purchases of mobile devices with steep price tag will be delayed until the end of 2009. End users will select low-end and mid-end mobile devices over high-end familiar brands. There will be added interest in new brands that provide cheaper options.


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