EE 566 The Information and Telecommunications Industry

1. EE 566The Information andTelecommunications Industry Ying-Chang Huang 2964-7696

2. Sector analysis for 2003 • 2002 – a tough year for the ITC industry • Employment drops in service areas for the first time • The restructuring process continues • Worrisome prospects for 2003

4. The ITC industry up to the 80s

5. The ITC industry starting from the 80s

6. Drastic reduction in jobsamong hardware manufacturers • The most important providers in the hardware area are FujitsuSiemens, Sun, IBM, Hewlett-Packard/Compaq and Dell. • The number of jobs at manufacturers of data-processing devices have been in decline since 1995. • The number of jobs has dropped from almost 40,000 employees in 1995 to 22,247 in 2002. This is a drop of almost 44 percent. example: • 4,000 out of 25,000 employees at IBM • 1,100 out of 8,200 employees at HP/Compaq • Approximately 450 out of 5,750 employees at FujitsuSiemens

7. The number of employees hit a historical low in 2002!(14.6% dropped)

8. Drop 13.1% in 2002

9. Lower levels of orders in hand

10. Structure of IT services • Internet/online/data services: T-Online/Deutsche Telekom AG, AOL, Lycos, Mediaways, QSC and GFT • Software: Microsoft, SAP, Oracle, Software AG,Intershop Communications and CA Computer Associates • IT services: CSC Ploenzke, Accenture, EDS, GE Compunet, Lufthansa IT, Thyssen Krupp – Information Services (Xtend AG, Triaton)

11. Doubling of jobs up to 2001 in only six years! • This growth cooled considerably for the first time in 2002.(2%)

12. Stagnating sales at IT service providers and software manufacturers expected in 2003

13. Much growth down in 2002!

14. Manufacturers of communications technology1.Device production (hardware) • The most important providers of infrastructure and end devices are: Nokia, Ericsson, Siemens (cellular radio and network sectors), Lucent, Motorola and Nortel.

15. Communications devicesNumber of employees • Rise in employment up until 2000 • Eight percent drop in employment in 2002 example: 900 out of 2400 jobs at Ericsson 1800 redundancies have been announced at Siemen-ICN

16. Communications devices Sales • Meteoric rise in sales until 1999-2000 • 11.7 drop in sales in 2002

17. Communications devices Orders in hand • Decline in orders in handsince 2001

18. Telecommunications services • The most important providers in the fixed network area include:Deutsche Telekom, Arcor, Mobilcom, BT Ignite (Viag Intercom), Colt Telecom and Worldcom. • The most important providers of services or network operators in the cell telephone sector are: T-Mobile, Vodafone, E-Plus, Viag Intercom, Mobilcom and Debitel.

19. Telecommunications servicesNumber of employees • Three percent drop inemployment in 2002 (1800 redundancies have been announced at Mobilcom)

20. The market for mobile radio communication • Growth in sales has slowed in the mobile communications area

21. Market for fixed networks • Stagnation to slight decrease in sales in fixed network area

22. Summary • Decline in employment of about four percent in 2002 • Hardest hit: The biggest declines is in hardware • Decline in employment in services in 2002 as well • Over 80 percent, the overwhelming majority of staff the ITC industry are employed in the service sector of the branch. • Forecast: ITC is not very optimistic!

23. Why ITC go to Down??? • Market saturation • “Wintelism”(windows comes out with a new operating system with new programs requiring a computer with a fast processor) is no longer working • The sluggish global economy • Traditional IT hardware manufacturers increasingly penetrating the service market • No new trends in sight

24. Don’t worry!!!

25. The Future • Integrated-services digital network (ISDN). • The convergence of the internet • Mobile phones and PCs • Growing options via wireless • Fiber optics • Satellite and DSL • ………..

26. Thank you!!!