Tag: market

Indian based IT service providers grow

The top five Indian based IT service providers are continuing to grow.

According to a report by Gartner the companies grew 23.8 percent in 2011, compared to the 7.7 percent of growth for the whole global market.

TCS came out on top with a 2011 market share of 1.1 percent, saw a 2010-2011 growth rate of 29.4 percent and a revenue of $9031 million.

There were some changes at the top – with Cognizant triumphing over Wipro to become the third-largest Indian IT services provider. The company also saw the highest growth rate of 33.3 percent among the top five providers in 2011.

Infosys came in at second place, raking in a 2011 revenue of $6,279.  This contributed to a growth rate of 17.8 percent and a market share of 0.7 percent. However, it hasn’t all been bells and whistles for the company, which has been fraught with allegations of fake visas and low pay.

Last month whistleblower Jay Palmer, who previously worked as an IT consultant for the company, claimed that the service provider smuggled Indian workers into the US. He also claimed that the company had fiddled business visa rules requiring foreign workers to be paid US market rate, and paid them minimal wages.

Earlier this month, the company was dealt a further blow when an anonymous ex worker gave details on how the firm bypassed US visa laws and discriminated against American staff.

However, this hasn’t put companies off using the firm or the competition, with Gartner claiming that the top five service providers have continuously chipped away market share from the large multinational corporation providers.

It said that this was a result of increasingly winning large outsourcing deals, from Fortune 1000 companies, which reached roughly $100 million in the past five years.

Greatly expanding service portfolios and cross selling products such as infrastructure services, business process outsourcing (BPO) services, cloud and analytics services, has also given these companies an edge, Gartner said.

Apple losing ground in China

As we predicted, Apple is losing ground in the Chinese market.

According to Gartner analyst CK Lu, Apple’s slice of China’s booming smartphone market slipped for a second straight quarter in October-December.

The problem is that Apple is refusing to change its business model in the highly competitive Chinese market and is losing its ground to cheaper local brands.

Behind the bamboo curtain, Cupertino is facing cut-throat competition from South Korea’s Samsung, Nokia, and local firms Huawei and ZTE.

Apple has slipped to a dismal fifth place in China, overtaken by ZTE, and its share of the China smartphone market share slid to 7.5 percent from 10.4 percent in July – September.

Samsung is winning in China, which knocked Nokia from the top spot, taking 24.3 percent of the market, more than three times Apple’s share.

Nokia is suffering a bit having lost half of its market share above 40 percent in the first quarter to below one fifth by the fourth quarter.

CZ Lu said that Chinese handset makers have been actively promoting their smartphones with China’s three telecoms operators, and ZTE and Huawei gained significant market share.

Gartner expects things to get worse for Apple for at least the next couple of quarters. The company was only able to make a limited impact in this quarter because of the release of the iPhone 4S which just made it to China. The novelty of the new phone is dropping quickly, he noted.

Since the beginning of the year, ZTE had a market share of just three percent, but ended 2011 ranked 4th with over 11 percent market share. It looks like this company is replacing Nokia in the “cheap and cheerful” market while Samsung is killing Apple at the higher end.

Jayesh Easwaramony, an analyst with Frost & Sullivan in Singapore, told Reuters that Apple had ignored the rule of thumb which worked in China. That is that a handset price has to be close to 70 percent of the monthly salary. An iPhone is more than two months which effectively kills it stone dead.

Meanwhile, Huawei and ZTE have the opportunity to cater to a mass market that is captivated by the iPhone, but doesn’t have the purchasing power for it. 

PV module revenues stagnate for 2011

There will be no revenue growth for photovoltaic modules this year.

Globally, solar installations are picking up the pace – with an expected 14.7 GW expected for the second half of 2011 and 21.2 GW for the year in total, that tricky price balancing means  the module business won’t grow at all as prices shrink.

According to the chief photovoltaics analyst for IHS, the weaker first half of the year means significant price drops for solar modules – as a result, crystalline and thin film module revenues will stagnate.

Analysts say the blame for the first half of the year lies in market changes in Germany and Italy, currently the two largest markets for PV in the world. Module prices in Germany were too expensive, which put off customers in investing until May this year.

Though there was a price drop in May and June, which did stimulate demand, market watchers and potential investors held off until further price cuts. Italy’s new energy policy, the 4th Conto Energia, shook up its market which caused much furrowing of brows for buyers.

IHS claims that the situation is back to OK, now.

Still, modules are remarkable big business. Last year saw total module revenues reach $34.6 billion which will be more or less the same by the end of 2011 – while demand is at an all-time high.

IHS predicts that more price drops will be on the way at the beginning of 2012, destabilising the industry as a whole. 

APAC solar markets on course for rapid expansion

APAC photovoltaic markets are on course for rapid expansion, and will account for a quarter of demand, worldwide, by 2015.

Although long-term forecasts can be tricky to get right, Solarbuzz’s latest report says the top five markets in the region, which are China, Japan, India, Australia and South Korea, will manage 3.3 GW in 2011 alone. China and Japan are ahead of the pack.

China and India will be particularly high growth countries as policy changes come into effect. China is running both national and provincial programs which should see its market shoot up by 174 percent compared to 2010. Growth will mainly be led by utilities, taking over from residential installations. In fact, China’s on-grid installations will double in 2011 thanks to incentive policies for large scale PV installations.

Beijing’s introduction of FIT policies throughout the country means it is set to break a record GW level, says Solarbuzz, including a 10 GW project pipeline. 

Meanwhile, South Korea is implementing its Renewable Portfolio Standards, which should see 1.2 GW in capacity installed over the next five years, but at a snail’s pace compared to previous years.

As with the European market, FIT incentives are increasingly facing the chop. But Solarbuzz said that although large ground-mount installations took a hit, it means there is opportunity for solid growth in building-mount, which will continue in the near future.

Changes in Australia’s photovoltaic incentives, like Solar Credits, didn’t knock its growth. Although the government seemingly beckoned a slower change of pace in PV installations, there was a 431 percent market growth in 2010. 

India’s installations should double this year. State policies in Rajasthan, Maharashtra and Gujarat, twinned with the National Solar Mission, will see the three states really lead the way with photovoltaics in the Indian market. They’re expected to tally up 70 percent in the country overall. Project pipeline targets set for 2013 are at 1.5GW as of June this year.

European solar market struggles to gain traction

Yes, there’s still strong market growth for photovoltaics here in Europe! That was the message in June this year, but falling prices haven’t helped give PV the shot in the arm it needs.

Germany is partly to blame for what Solarbuzz calls a faltering market in its latest report. Relief was imminent thanks to mid-year tariff reductions but the government decided to turn the lights off on that project.

Some areas of Europe in particular have been helpful to PV adoption in the past. Germany and Italy are the obvious examples, while the UK toys with the idea. PV installations have arguably already made their mark in Germany, where it’s not uncommon to see retail outlets on the street flogging their panel services. The age of uncapped and aggressive, government sponsored feed-in tariffs could be a thing of the past in developed markets like that.

Germany, Italy and the Czech Republic all lead growth in 2010. Italy is expected to overtake Germany by 2015, to hold 39 percent of market share. 

Solarbuzz says the average distie prices for crystalline silicon modules from China was dented 20 percent, reaching €1.28/W. Downturns in major markets, says Solarbuzz, did hit manufacturers in the first half. Crystalline silicon module prices have reached unthinkable lows of €0.75-1.00/W.

Over-valued inventories are a real problem right now for companies working in the downstream. Again, it’s because of PV incentive adjustments throughout Europe. Solarbuzz says Germans working with utilities are even worried that the capcity is creating a serious risk for overall grid stability.

Now there’s a focus from PV to that other eco-friendlier big businesses, electricity storage and smart-metering.

Ultimately that’s going to knock the deployment of PV. 

HTC prepares mainland China invasion

HTC could be giving behemoth ZTE a run for its money in the Chinese smartphone market.

The mobile company, which is top of the pops in its native Taiwan, has announced that it will ramp up the number of shops in mainland China from the current 630 to 2000 by the end of the year. The Chinese telecoms market is 10 times bigger than its Taiwanese cousin.

According to the Taiwan Economic News, senior executive vice president at HTC, Fred Liu
said HTC is aiming to conquer the China market, pitting it against the big boys such as ZTE. Bringing with it will be R&D,  a broad product line, and a new approach to retail.

Liu added that the powers that be at HTC are working on serious R&D expansion, set to be four times bigger than its existing projects in the mainland. Once completed, the team will work on stuff like time-division (TD) mobile technologies.

It has already released its HTC Incredible phones in partnership with China Telecom as well as unleashing its TD-SCDMA and WCDMA versions of the HTC Sensation phones, in partnership with China Mobile and China Unicom.

The telecoms bigwigs have responded by helping HTC promote its retail outlets in the mainland, which means increased competition for ZTE. It won’t be shaking in its boots any time soon – it is already well established in China and has aggressive expansion plans for the rest of the world where it’ll look to take a bite out of HTC’s cherry. Then there’s all the infrastructure kit and contracts it keeps winning, worldwide.

HTC clearly knows that the mainland is the best way to go if it wants to conquer the Asia Pacific market.

Indecisive governments cause PV market bother

There are a few problems in the photovoltaic market thanks to shifting attitudes from different governments.

According to Solarbuzz, constant government policy adjustments are causing waves in sizes, growth rates and customer markets in this industry.

In three Regional Downstream PV market reports, analysts pinpoint the European market, led by Germany and Italy, as having a few problems. Solarbuzz says the two had absorbed Feed-In Tariff (FIT) rate cuts of up to one-third between January 2010 and July 2011.

And that has had a knock on effect, with the first quarter of 2011 failing to hit demand. 

The domino effect means that in the first quarter of 2011, Germany hit less than half of what it did in the same time last year.

European full year demand will stay flat this year compared to 2009 and 2010 when it rose more than 170 percent.  

It blamed government indecisiveness with PV policies, claiming these had particularly hit large ground-mount systems on agricultural land.

That said, there was some good news, as investment returns across the range of residential and commercial roof-mounted installations stayed buoyant. However, this month these too had begun to slip.

We will see a slip in PV shares in Europe, says Solarbuzz. It added that the region is predicted to hold around 65 percent of the market this year compared to the forecast 82 percent it held in 2010.

Meanwhile, the Asia Pacific and US regions will have some success, with predictions of growth over the next five years.

The US will grow from five percent to nine percent by the end of this year, while their  top five Asia Pacific counterparts – led by Japan and China – accounted for 11 percent of global demand in 2010. It said that this share will grow to 16 percent this year.

By 2015 it’s forecast that the market share of the Asia Pacific regions will continue to grow by around 26 percent. Solarbuzz also had good news for the US, saying it will see a 14 percent growth over the same period.

European distribution margins “held up better than expected during 2010 and early 2011, as project margins collapsed.” It said this caused a refocusing of business models and channels to market.

Europe benefitted from sharply lower prices during the first quarter of 2011, which had a positive knock on effect on Italian demand.

Chinese module supplier prices in Europe fell 25 percent below their European and Japanese competitors in 2010. They continued to drop throughout the year reaching a measly 10 percent in February 2011.

China sat at second place in the Asia Pacific region for demand, beaten by Japan which saw formidable 111 percent growth, driven by residential demand accounting for 82 percent of the market.

The earthquake didn’t affect this particular market because there was strong solar policy support already in place.

Large panel sales suffer

Panel makers are saying there’s much lower demand for large-size LCD screens than they had hoped. 

According to an article in Digiimes, component producers have said that order visibility in the large panel market is unclear.

They pointed out that China’s period of high growth in its LCD TV market has passed, meaning the annual growth would be a measly 15 percent compared to the 80-100 percent in previous years. If prices continue to fall globally then many firms would move to decrease their utilisation rates rather than operate at a loss.

The predictions are something that Bob Raikes, top analyst at Meko, agrees with. He told TechEye that at the moment there is “without question, weak demand in Europe for the major large LCD applications”.

Meko, he said, tracks two of them – TVs and monitors – while other analysts have pointed out the weakness in the market for notebook PCs.

“Meko tracks inventory and sales results with major brands every month and the indexes for both TV and monitors have been getting worse in both areas,” he said.

“Part of that is a normal seasonal pattern – demand is always weak in this part of the year, unless there is an Olympics or World Cup which can move some demand from Q3 to Q2 in ‘even years’. This is an ‘odd year’, so there is nothing to stimulate the market. Consumers are also lacking in confidence in many parts of Europe.

“A look at the deals available in the high street shows there are more TVs around than consumers want to buy.”

There are other factors dragging the industry down outside of Europe.

In the US, consumers are still getting their debts in order, while a combination of the tsunami and the end of a special campaign by the government to boost TV sales have combined to really drive demand down in Japan.

“We can’t see where the demand is to help the panel makers get the supply / demand balance back to a point where they can push prices back up, even though they need to.

“It will be a brave panel maker that reduces its loading to try to tighten supply.” 

Nokia mobile market share slips to its lowest in 14 years

According to the latest report from Gartner, end users worldwide bought a total of 427.8 million phones in the first quarter of 2011, an increase of 19 percent from the same time last year.

Smartphones dominate over the rest of the market, accounting for 23.6 percent of overall sales in the first quarter of 2011. This has been an increase of 85 percent year-on-year.

Gartner points out the figure could have been higher if manufacturers had shipped their announced Q1 devices, as many consumers are waiting for the shiny new models to hit the market rather than buy into technology with a short shelf life.

Nevertheless. that didn’t stop the big brands raking it in – with Samsung experiencing its strongest first quarter ever.

The Galaxy line continued to be a resounding success, where demand also helped offset an increase in materials costs.

Samsung’s success also lies in its numerous product announcements during the first quarter of 2011, notably the Galaxy smartphone announcements, its Wave 578, and the new models of the Galaxy Tab.

It seems Samsung will continue to ride on the success of these products into the second quarter. 

Apple unsurprisingly did well in the quarter, selling 16.9 million units and doubling its sales of iPhones year-on-year. This, Gartner said, was down to the iPhone being available in 90 countries.

Also recording a very strong first quarter, with 9.3 million mobile communication devices sold, was HTC, which moved into the seventh position as a result of its success. 

Strong high-end products also helped the company do well with all major US retailers, and in the first quarter of 2011 it became the number two smartphone manufacturer in the region, overtaking Research In Motion.

Android and Apple still rule the roost with operating systems.

Gartner highlights that big news on Nokia’s “strategic alliance” with Microsoft on Windows Phone 7, and the retirement of Symbian.

“This will precipitate a competitors’ rush to capture Symbian’s market share in the midtier,” it said.

Nokia’s share in the mobile phone market dropped to 25 percent in the first quarter of this year, a drop from the 30.6 percent at the same time last year. That’s the lowest it has been in the market for 14 years.

TSMC just won't drop its prices

Taiwan Semiconductor Manufacturing Company (TSMC) won’t be lowering prices any time soon. Instead it will capitalise on its leading position and will dictate how the market operates.

There were reports in Taiwan’s Economic Daily suggesting the company has been in talks with clients to lower prices by three to five percent in the third quarter.

But it doesn’t make sense, according to industry analyst at Future Horizons Malcolm Penn. The company, really, has a monopoly on the industry – and given the time of the year and the health of the markets, TSMC will do no such thing. 

“Now is a good time for the industry, demand is high and the Japanese earthquake has affected supply, meaning prices should be going up, something TSMC knows,” Penn told TechEye.

He pointed out that TSMC has such a huge grasp on the market that “if it was to reduce or up prices the industry would be affected.”

“There would be no reason for the company to reduce their prices,” said Penn.

He reckons clients wouldn’t buy from the company “without first agreeing a fixed price, as they don’t want any surprises when they get their supply.”

“The fact is that TSMC is a major player in the market, it sets the bar for the industry with the exception of Apple,” he said.

“Take out the big ones and the world is TSMC’s. It says jump, we say, how high?”