The European e-Business Report 2004 - Berlecon Research GmbH

More documents

Recommendations

Info

The European E-Business Report 2004Telecommunication and computer services both showed a picture of healthy growth in production andmarkets in the second half of the 1990s. From 2001, however, ICT services markets have beenseverely affected by the burst of the Internet economy bubble and growth has been reducedsignificantly. From EITO estimates, CAGR have reached only 3.4% over the 2001-2003 period (1.7%in IT services and 4.6% in carrier services). The European ICT market is now entering a phase ofmaturation.ProductivityProductivity, measured as output per employee, differs significantly between telecommunications andcomputer services. The turnover, as well as the value added per person employed, is considerablysmaller in the computer services sector. This can be explained by the high capital intensity oftelecommunications and the fact that the statistics only measure labour productivity and not total factorproductivity.Trends and challengesTelecommunication services have changed considerably during the previous years, bringing newsector-specific issues and challenges to companies. Important issues are related to the technology,regulatory framework and the general market developments:Technological innovation has considerably influenced telecommunication services and opened upnew opportunities for e-business. One of these technologies is broadband Internet access. Anothergroup of new technologies related to the telecommunication network itself as well as to itsadministration is the digitisation of networks.Regulatory framework: The software industry is still intensively discussing two related legalquestions. The first is the question of intellectual property rights protection, as international exchangesof software over the Internet made copyright infringement easier, leading to an alleged increase insoftware piracy. The second concerns software patents. While most forms of software were originallyprotected by copyright, the ICT industry now appears to be strongly against patenting software as thismight arguably stifle innovation in the software development industry.In telecommunications, the new competitors have been only partially successful, due to weaker thanexpected demand and interconnection disputes with incumbents. Such disputes about access toessential facilities of the incumbents as well as about the pricing of this access have been backgroundnoise for the telecommunication industry since its liberalisation.Market developments: Mobile telephony, for years Europe's big success story, has lost some of itsformer appeal. The average revenue per user (ARPU) has fallen significantly, as mobile users withlower usage have become customers and as prices for mobile phone calls have fallen. At the sametime, costs for running the phone network have remained constant or even increased, puttingsignificant pressure on margins. High bets have also been placed on the success of the thirdgeneration wireless technology (Universal Mobile Telecommunications System – UMTS).Another important issue is the rising importance of data traffic. The increased use of the Internet hasfuelled demand for access services as well as for Internet backbone services. It was expected thatdata would quickly overtake voice as the main source of traffic on global telecommunication networks.However, despite the increasing demand, considerable overcapacity for backbone services has beenbuilt up. This capacity, which was more than needed, is to a large extent unused by now, and isputting pressure on prices for backbone services.Within the IT consulting business, a major challenge was to cope with the rapidly increasing demandfor e-business related consulting and integration services and the subsequent sudden fall in demand.The bursting of the Internet bubble has led to overcapacities in many consultancies, which today haveto adapt to the lower level of business activity without demoralising their remaining staff. At the sametime, the outsourcing services industry (part of NACE 72.3, data processing) has also seen anincreasing demand.153
The European E-Business Report 20042.8.2 Diffusion of ICT and e-business in 2003/04The results of the e-Business Survey 2003 show that the ICT services sector stands well ahead of theother sectors monitored in terms of ICT equipment and adoption of e-business applications. Almost82% of the respondents of the survey state that e-business constitutes a significant or some part ofthe way their company operates today, compared to 60% in the other sectors. The ICT services sectoris an early adopter of e-business applications in every respect.Exhibit 2.8-2: The importance of various e-business objectives and applicationsin the ICT services sector in overviewE-business application area Importance Remark / exampleFacilitate remote and mobilework (fieldworkers, home-basedtelework)Improve knowledge managementby using special softwareAutomate internal businessprocessesICT services companies are well equipped with systems thatfacilitate remote and mobile work. The rapid technologicalchanges and innovations in the sector require vast amounts ofinformation and knowledge sharing from different locations.Use of KM software increases, but predominantly among largecompanies.Reducing administrative costs (travel reimbursement, HRmanagement) and improving business processes (relationshipswith trading partners) is a priority in most sub-sectors.ERP systems ERP is not an e-business priority in this sector. These systemsare more useful to manage complex supply chains involvingphysical supply goods.Supply chain process integration Like ERP systems, and for similar reasons, SCM is not a toppriority for companies in the sector.Decrease direct procurementcosts through e-procurementWeb based e-marketing andcustomer related servicesElectronic customermanagement (CRM)E-commerce: Increase salesvolume / area through selling onthe InternetB2B marketplaces on theInternetUse of e-business standards forexchanging structured dataWeb services and XML basedstandardsExtended enterprise: collaborative(online) e-product designAs in other sectors, the largest companies pursue the goal ofstreamlining the selection of their supply firms. In general, thefocus of the organisation is rather on making processes moreefficient.These applications are widely used. There are important forthe ICT services sector, especially in the telecommunicationsand software sub-sectors.The ICT services sector stands far ahead of the other sectors.The growing demand in customised and flexible servicesmakes CRM a key issue, especially in telecom and softwaresectors.Selling online through the company website is already a realityfor many firms from the sector. The Internet is a keydistribution channel.B2B marketplaces are used by telecommunications companiesand, to a lesser extent, software firms, both for procurementand sales.The exchange of structured data remains a crucial issue as theICT market becomes more and more global, in particular in thesoftware services sector.Companies themselves are only moderately convinced aboutXML. However, it could become the main standard forelectronic transactions in the future.E-product design technologies in software sectors are widelyused, but diffusion varies among other sub-sectors. = little relevance; = average relevance; = very relevant; = highly relevance for sector = mixed results, depending on the sub-sectors in the ICT services industryICT infrastructureSource: e-Business W@tch (2004)ICT services companies are better equipped with ICT infrastructure (LAN, WAN, remote accesstechnology, Wireless LAN) than the 9 sectors studied by the e-Business W@tch in 2003/04. Internet,e-mail and the Web are common tools that enable to transfer data and communicate in every ICT154
Page 1 and 2:
Third3Synthesis ReportThe Europeane
Page 3 and 4:
The e-Business W@tchThe European Co
Page 5 and 6:
The European E-Business Report 2004
Page 7 and 8:
Page 9 and 10:
Page 11 and 12:
Page 13 and 14:
Page 15:
Page 18 and 19:
Page 20 and 21:
Page 22 and 23:
Page 24 and 25:
Page 26 and 27:
Page 28 and 29:
Page 30 and 31:
Page 32 and 33:
Page 34 and 35:
Page 36 and 37:
Page 38 and 39:
Page 40 and 41:
Page 42 and 43:
Third3Synthesis ReportElectronic Bu
Page 44 and 45:
Section I: The e-Business Index(a p
Page 46 and 47:
Section II: The European e-Business
Page 48 and 49:
Page 50 and 51:
Page 52 and 53:
Section III: 20 indicators on ICT a
Page 54 and 55:
Page 56 and 57:
Page 58 and 59:
Page 60 and 61:
Page 62 and 63:
Page 64 and 65:
Page 66 and 67:
Page 68 and 69:
Page 70 and 71:
Page 72 and 73:
Page 74 and 75:
Page 76 and 77:
Page 78 and 79:
Page 80 and 81:
Page 82 and 83:
Page 84 and 85:
Page 86 and 87:
Page 88 and 89:
Page 90 and 91:
Page 92 and 93:
Page 94 and 95:
Page 96 and 97:
Page 98 and 99:
Page 100 and 101:
Page 102 and 103:
Page 104 and 105: The European E-Business Report 2004
Page 204 and 205:
Page 206 and 207:
Page 208 and 209:
Page 210 and 211:
Page 212 and 213:
Page 214 and 215:
Page 216 and 217:
Page 218 and 219:
Page 220 and 221:
Page 222 and 223:
Page 224 and 225:
Page 226 and 227:
Page 228 and 229:
Page 230 and 231:
Page 232 and 233:
Page 234 and 235:
Page 236 and 237:
Page 238 and 239:
Page 240:
Enterprise publications
show all

The European e-Business Report 2004 - Berlecon Research GmbH

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?