Information and Communication Technology (ICT) market

1. Market value
Market values reflect revenues paid by the final customer to primary vendors and service providers either directly or through distribution channels. Thus market revenues reflect end-user spending in a particular country, excluding VAT. All market values are given in Euro. For all non Euro zone countries market data were converted from local currencies to Euros using the yearly average exchange rates of local currencies to the Euro for 2007 as provided by the IMF database (see section 6 below).

2. Unit shipments
Unit shipments is the unit measure of hardware product sales by vendors or by distribution channels to end users.

3. Market segmentation (revenue data)
The ICT market contains six major segments: IT equipment, software, IT services telecommunications equipment, and carrier services. The IT market is the sum of IT equipment, software, and IT services. The telecom market is the sum of telecom end-user equipment, network equipment, and carrier services.

Overview of market segmentation:

IT market
IT equipment	PCs        Desktop PCs        Portable PCs Printers Multifunction Printers Copiers Monitors Other IT equipment
Software	System infrastructure software Tools Application software
IT services	Hardware maintenance Project services Outsourcing services
Telecom market
Telecom end-user equipment	Mobile phones Fixed line phones and Customer Premises Equipment (CPE)
Network equipment	LAN routers and switches PBXs, KTS and applications Voice switching equipment WAN data routers and switches Wireline access infrastructure Mobile access infrastructure Transmission equipment Support systems (OSS/BSS) Infrastructure services
Carrier services	Fixed voice telephony Business data services Internet access and services Mobile voice telephony Mobile data services Pay TV

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4. Definition of market segments (revenue data)

4.1 IT equipment

IT equipment includes desktop PCs, notebooks, Multifunction Printers (MFPs), printers, copiers, monitors, and other IT equipment.

• Desktops: Non-portable personal computers for use in an office or at home, regardless of their form factor. Includes all-in-one computers with built-in display and multimedia centres. Also included are PC workstations.
• Notebooks: Portable personal computers for use on the move, sharing the "notebook" foldable form factor with built-in flat panel. This includes mobile workstations, sub-notebooks, and touchscreen devices (e.g. Tablet PCs).
• Printers: All non-multifunction ink-propelling printers; impact printers, which work by pressing pins against an inked ribbon; all non-multifunction laser printers; printers using Xerox's solid ink technology.
• Multifunction printers (MFPs): Inkjet printers with extra facilities such as scanners, copiers and/or fax systems; non-modular laser printers with extra facilities such as scanners, copiers and/or fax systems; modular multi-function printers built around a standard printer engine.
• Copiers: Laser technology flat bed A4 and A3 printing equipments with glass window. This includes both single function and multifunctional (copier/fax and copier/printer/fax) products.
• Monitors and Public Information Displays (PID): LCD-based (Liquid Crystal Display) displays for use with a computer or as a monitoring/display unit. Some feature TV tuners but are categorised according to the manufacturer's description. CRT-based (Cathode Ray Tube) displays with no TV abilities, meant to be used with a computer or as a monitoring/display unit. Includes LCD and CRT touchscreen monitors and professional displays. Excludes devices where the monitor is only part of a complex product, like all-in-one computers, notebooks and tablet PCs, or rackable screens and console kits (screen + keyboard kits as server accessories). Also excludes all audio/video displays (CRT Televisions) and devices where the monitor is only a built-in part in a complex product, like all-in-one Desktops.
  
• Other IT equipment includes other hardware equipment markets not covered in the above segments: server hardware, including volume servers, mid-range servers, high-end servers, and add-on storage for such servers as well as other add-ons (e.g. memory upgrades); small hand-held products (e.g. Personal Digital Assistants - PDAs); non-PC workstations (Unix); hardened systems, low-spec server-based clients as well as specialised computers for specific environments (industrial PCs, ATM, terminals, Thin Clients, Points of Sale equipment, etc.); high-end printers: inkjet printers with formats larger than A3, other printers with speeds higher than 55 pages per minute (ppm); other add-ons – hardware products not acquired in the initial purchase and not included in other categories (e.g. replacement or upgrade hardware, memory upgrades).

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4.2 Software

Software spending figures include only spending on licenses and maintenance/support. All related spending from implementation services (consulting, implementation/customisation, training) are counted as project services.
Software includes three major sub-segments:

• System infrastructure software: proprietary as well as open operating system and system-level software; network, system, storage, and security management software for all types of hardware (from mainframe to PC).
• Tools: collaboration and content tools; database engines; business intelligence infrastructure; development tools; integration platforms.
• Application software: office automation, business applications and other applications. The office automation software market includes, for example, software for word-processing, data spreadsheet, and presentation software. Business applications are process-oriented applications that include horizontal applications such as financials, HRM, CRM, SCM as well as industry-specific solutions such as billing (telecom, utilities), core banking systems, etc. Other applications include graphical software, embedded systems, and other technical software.

• Application software products can be either out-of-the-box solutions, such as most productivity software products and business applications for the small office/ home office market, or more complex/ process-oriented solutions that require implementation and customising services, such as business applications for the mid-market and for large enterprises.
• Application software products are often sold as packaged solutions including hardware and services, e.g. implementation services. The value of the hardware and services resold is excluded if it can be determined. All related revenues from implementation services (consulting, implementation/ customisation, training) are recorded as project services revenues.
• Software as a Service (SaaS) revenues are not included under application software products as they are typically billed on a subscription basis and do not license actual software. Such revenues are included in the outsourcing/processing segment.

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4.3 IT Services

IT services include:

• Hardware maintenance: hardware and system software installation, repair and support for all types of hardware (from mainframe to PC) and related system software (proprietary or open systems). Note that this segment does not include maintenance services within the framework of an outsourcing contract.
• Project services: professional services and systems integration, which can be categorised as:
  • IT consulting: Planning, specification, and design of information systems. In addition to purely IT-related services (audit of the information system, design, selection of technologies and products) this also includes the "process consulting" (BPR and similar services) component of projects such as ERP implementation. The IT consulting market is divided into three main sub-segments: consulting on technologies and infrastructures, consulting on Management Information Systems (MIS) applications, and consulting on scientific, technical, and embedded information systems and applications.
  • Contract staff (time and materials): Software development and maintenance, implementation/ customisation of software products (applications and/or tools), on both a time and materials basis. Note that revenues of IT staffing companies working for other IT services suppliers are not taken into account, as this would involve double booking.
  • Fixed-price development and systems integration: Software development and maintenance, implementation/customisation of software products (applications and/or tools), both on a fixed-price basis, and also including large and complex projects in real-time and other complex environments.
  • IT training: IT training can focus on either end users or IT professionals, and includes two types of delivery: standard training, including all multi-customer seminars, and customised training, including on a one-on-one basis.
• Outsourcing services include the following:
  
  • Complete outsourcing: Outsourcing of a company’s "central infrastructure and central application management" including the data centre as well as the operating and software development staff.
    
  • Application-related outsourcing including web hosting and ASP/SaaS; application outsourcing (outsourcing of an application chain, incl. server and basic system operation, and further development in part of the application); Business Process Outsourcing (BPO), i.e. assumption of responsibility for an entire business process (or parts of it), also including specialised administrators in addition to the related infrastructure and application management. In most cases, assets and/or staff are taken over. Only processes that to a significant degree are supported by IT (e.g. accounting, human resources, logistics, billing, card processing, etc.) are considered as BPO.
    
  • Infrastructure-related outsourcing including: data centre management, desktop outsourcing, and other infrastructure-related outsourcing
    
  • Application Management (AM): AM describes the maintenance and enhancement of existing applications, sometimes even their initial development, under a long-term (multi-year) contract with a commitment to fulfilling pre-defined Service Level Agreements (SLAs) on a fixed-price basis. Often, staff are transferred.
    Only “stand-alone application management” is considered in this segment. Embedded AM in complete or application outsourcing deals is included elsewhere in the corresponding segments.
    Captive IT outsourcing activities (activities of IT suppliers with their parent or sister companies) are not included in the IT services spending figures.

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4.4 Telecom end-user equipment

Telecom end-user equipment includes:

• Mobile phones: all handsets that have a communications function. This category excludes pure data/e-mail devices or PDAs, while it includes all smartphones (e.g. Blackberry phones). Reported revenues are based on vendor revenues plus retail distribution mark-ups but exclude any subsidies provided by carriers and service providers to reduce the price of handsets paid by end users.
  
• Fixed phones and CPEs: fixed consumer devices (DECT, etc.), corporate telephone devices, fixed IP telephony devices (IP Phones), residential broadband consumer premises equipment (CPE) including home gateways and DSL modems.

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4.5 Network equipment

The market for network equipment includes the following sub-segments:

• LAN routers and switches: equipment present on LAN networks (routers, switches, bridges and hubs); wireless LAN access points and network switches.
• PBXs, KTS and applications: PBX (traditional and IP), key telephone systems, and applications.
• Voice switching equipment: traditional TDM voice switches; next generation voice switching: softswitches, media gateways and session border controllers; mobile core equipment: mobile switching centers, GGSN, SGSN.
• WAN data routers and switches: IP routing equipment, routing and switching equipment via traditional (ATM, Frame Relay) and multi-service protocols (combining several protocols) installed on the network edge or in the core network of operators.
• Wireline access infrastructure: access equipment for narrowband equipment (dial-up telephony, low speed internet access); access equipment for broadband via xDSL technology (DSLAM access multiplexers, digital loop carriers DLCs) and PON technology (optical network terminals ONTs, optical line terminals OLTs)
  
• Mobile access infrastructure: access base stations for cellular networks (BTS for GSM/GPRS/EDGE and CDMA networks and Nodes B for UMTS networks) and control equipment (base station controllers); access base stations for public WLAN networks, also called hotspots
• Transmission equipment: systems for multiplexing/de-multiplexing terminals or add/drop (time division switching via SDH/SONET or wavelength division (WDM) switching); optical transmission systems used in terrestrial networks (metropolitan and long-distance); deep-sea networks related equipment (amplifiers and optical switches); wireless backhaul transmission systems.
• Support systems (OSS/BSS): integrated OSS/BSS systems for management of mobile and IP networks.
• Infrastructure services: technical services (network deployment and rollout, field maintenance, spare parts management, support and training); professional services (network design & planning, optimization, network consulting, system integration); managed services (application/service hosting, network operations outsourcing, build-operate-transfer). The segment includes exclusively infrastructure services provided by carrier equipment vendors and enterprise equipment vendors. Excluded are infrastructure services provided by other relevant market players like network integrators, carriers, and traditional IT companies.

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4.6 Carrier services

This segment includes:

• Fixed voice telephony: retail revenues from basic fixed-line networks and services: installation and rental fees, calls (local calls, long-distance calls, international calls, fixed-to-mobile calls); retail revenues from fixed IP telephony services. This segment includes only retail revenues (no interconnection revenues). It does not include communications related to dial-up Internet access.
  
• Business data services: dedicated data transmission networks revenues based on FR, X25, ATM, MAN or IP VPN services and revenues from retail analogue and retail digital leased lines on both permanent and dial-up connections. This segment does not include inter-operator sales of leased lines.
• Internet access and services: retail revenues from internet access services including both subscription and traffic for dial-up/narrowband and broadband services (xDSL, Internet via cable TV networks, broadband over fibre-optics; fixed access, radio access).
• Mobile voice telephony: retail revenues from voice services on wireless communication networks. Interconnection revenues are not included in this segment.
  
• Mobile data services: retail revenues from data services on wireless communication networks (SMS, MMS, data access and content), as billed by the mobile service operator. Interconnection revenues are not included in this segment.
  
• Pay TV: total subscription revenues from Pay-TV channels and services (i.e. premium channels and satellite, cable, ADSL and terrestrial bouquets).

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5. Market indicators

5.1 Telecom equipment

• Mobile phone volume sales: number of mobile phones sold during calendar year through retail distribution channels, excluding unsold inventories

5.1 Network equipment

• Wireline capex spending: capital expenditures of wireline (fixed) operators (excluding cable operators) and wireline division of integrated operators during calendar year
• Mobile capex spending: capital expenditures of mobile operators and mobile division of integrated operators during calendar year

5.2 Carrier Services

• xDSL subscribers: number of subscribers at year end to a digital subscriber line service, (in excess of 144k downstream) delivered over the copper telecoms network.
• Cable modem subscribers: number of subscribers at year end to a broadband access service (in excess of 144k downstream) delivered over the cable network.
• FTTx subscribers: number of subscribers at year end to a fibre to the home or fibre to the curb service (in excess of 144k downstream) delivered over a fibre network.
• 2G subscribers: subscriptions where the user has actively used services in the 2G network.
• 3G subscribers: subscriptions where the user has actively used services in the 3G network.
• VoIP subscribers: relates to telephony via alternate forms of access, xDSL, cable television, LAN, etc. This relates to the form of IP telephony where an ordinary telephone is linked to a broadband connection via, for example, a terminal adapter. Alternatively, an IP telephone or the corresponding is used, which is linked directly to a broadband connection.
• Cable TV subscribers: number of TV households paying a monthly fee to access a pay-TV offer (either analog or digital) via a cable-operator
• Satellite TV subscribers: number of TV households paying a monthly fee to access a pay-TV offer (either analog or digital) via a satellite operator
• TVoIP subscribers: number of TV households paying a monthly fee to access a pay-TV offer (either analog or digital) via a IPTV operator
• Digital TV subscribers: number of TV households paying a monthly fee to access a digital pay-TV offer (either by cable, satellite, IPTV or DTT).
• Internet users: number of individuals (consumers only) using the Internet at least once per month. The connection can occur from home, office, campus or other place.
• % of Internet users who purchase online: % of Internet users in a month buying products through B2C (business to-consumer, like traditional shops) or C2C (consumer-to-consumer, like auctions or classifieds) web services.
• % of Internet users who communicate online: % of Internet users in a month using online communication tools, including email, instant messaging, forums, chat and blogging.
  
• % of Internet users who download music online: % of Internet users in a month downloading music from legal sites (paid or free) or from illegal services (P2P, sharing sites, newsgroups, etc…)

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6. Exchchange rates
For all non Euro zone countries (EU member countries not participating in the European Monetary Union and countries outside of the European Union), historical and forecast market data were converted from local currencies to Euros using the yearly average exchange rates of local currencies to the Euro for 2007 as provided by the IMF database

Euro exchange rates (Units per Euro based on average rates for 2007)
Bulgaria	1,956
Czech Republic	27,777
Denmark	7,451
Estonia	15,650
Hungary	251,336
Latvia	0,703
Lithuania	3,454
Norway	8,023
Poland	3,789
Romania	3,337
Slovakia	33,794
Sweden	9,251
Switzerland	1,643
UK	0,684
US	1,369
Japan	161,174
India	56,595
Turkey	1,784

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