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Home > Newsroom > TMT Reports > Market Insight Reports
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Market Insight Reports
BDA provides strategy consulting services to telecom, media,
and technology companies operating in China or seeking to enter the market.
Whether your company is new to the market or seeking to expand its business in
China, BDA can help.“We have a tradition of helping clients make tough calls
about when to invest in China and when not to.”
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Jul 30 2010
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China's Telecom and Internet Market Forecasts 2010-2014
This report is only available to clients who subscribe to: china, handset, mobile_data, new_media, telecom
? Huawei in 2010 is reaping the benefits of its recent market share expansion in the China and European market, having climbed the league tables to reach the global #2 in sales of equipment to telecom service providers.
? However, incumbents are fighting back including Nokia Siemens Network through its recent acquisition of Motorola's wireless network infrastructure assets.
? Huawei faces a raft of external challenges now including the drop-off in capex in Asia Pacific, regulatory obstacles in the key Indian market and in the US an uphill battle in overcoming government resistance, entrenched customer habits and and the vigorous response of well-connected incumbents such as Motorola (e.g. the July 2010 lawsuit over Lemko alleging IP violations).
? The company also faces internal challenges including poor profitability in handsets/terminals due to customization as well as management issues.
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Apr 29 2010
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China's Telecom and Internet Market Forecasts 2010-2014
This report is only available to clients who subscribe to: china, handset, mobile_data, new_media, telecom
? The number of mobile subscribers will continue to grow robustly, thanks to more intense competition. Total mobile user numbers will reach the 1.17 billion mark by 2014.
? 3G terminal users will make up 27% of mobile users by 2014, or over 300 million. WCDMA will lead the 3G market.
? China Mobile will lose share by almost 10 percentage points in the next five years, due to increased competition from China Telecom and China Unicom.
? China's annual handset sales will continue to grow steadily, amounting to 400 million units in 2014.
? 3G handset sales in 2014 will number 181 million units, or 45% of overall handset sales; WCDMA phones will dominate in this sector.
? Internet users will number 771 million in 2014, up from 384 million in 2009. Mobile internet users will amount to 750 million in 2014, 97% of internet users, or 64% of mobile users.
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Feb 25 2010
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Application Stores in China-Opening the Door to the Mobile Internet Revolution
This report is only available to clients who subscribe to: china, mobile_data, new_media, telecom
? Although financial return will be difficult to achieve in the near term, many players have followed Apple to launch their own application stores. BDA believes content/applications delivered in Application stores are one of the Key Success Factors for the mobile Internet market.
? Eyeing opportunities in the largest Mobile Internet market, handset/IC vendors, telecom operators and internet companies are launching or planning to launch application stores in China.
? Most handset/IC vendors' application stores will not have a significant impact in China except Apple, Nokia, Motorola, RIM and MediaTek.
? China Mobile opened its own application store to avoid becoming dumb pipe. China Telecom and China Unicom have followed China Mobile but trail the market leader.
? Internet companies open application stores to migrate established position/content to mobile Internet market.
? The expansion of the application store business model is generally positive for application developers as they gain more channels to market their products.
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Sep 29 2009
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Huawei Finding Opportunity In A Crisis
This report is only available to clients who subscribe to: china, handset, mobile_data, new_media, telecom
? Huawei is on track to become the world #2 in sales of telecom equipment to telcos, passing NSN and Alcatel Lucent.
1. Huawei is closing in on Ericsson and NSN in APAC, and has narrowed the gap in EMEA and LATAM
2. Huawei more than doubled its share in the global wireless market in 2008 thanks to WCDMA
3. Huawei managed to maintain stable revenue in the wire-line market while saw no growth in capex in 2008
4. In 2008 Huawei increased its share in China's telecom equipment market by 7% to reach 29%, thanks to success in 2G
? Looking forward, Huawei is embracing opportunities in: 3G, LTE & PON, carrier cost controls, and government funding for exports.
? Huawei faces five major challenges in the near term: Capex decline, pressure on margins, weak in professional service, increasing competition from Ericsson and political sensitivities.
? BDA's top 5 predictions for Huawei's next five...
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Sep 25 2009
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Huawei & ZTE's terminal business-Looking for New Growth Engines
This report is only available to clients who subscribe to: china, handset, mobile_data, new_media, telecom
? From the global 6th and 7th ranked vendors, ZTE and Huawei are positioned to overtake Motorola & Sony Ericsson in the coming years.
? Huawei's terminal shipments doubled in 2008, and ZTE also saw its terminal sales volume increase by 51% YoY; Handsets and data cards were the two main drivers. Huawei has almost caught up with ZTE in terms of handset shipments in 2008.
? In China market, ZTE has invested heavily in all three 3G standards while Huawei concentrates on W-CDMA handsets. The two will continue to dominate 3G datacard market in China. They will put their logos on all future 3G models for Chinese operators aiming to improve brand image. Up to now Huawei and ZTE have thrived on low-end CDMA phones but intend to move into the mid-market CDMA 1X handset segment.
? For overseas markets, Huawei and ZTE will continue to specialize in customizing low-end models but will also try to make progress in Smartphones. They will continue distribute handsets through operators' channels only.
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Jul 17 2009
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China's Online Game Market: Onward and Upward
This report is only available to clients who subscribe to: new_media
Current Perspective
? China's online game market revenues increased to RMB 19.8 billion (USD 2.84 billion) in 2008, up 50% YoY.
? MMORPG (Massively Multiplayer Online Role Playing Games) dominate the online games market with a 75% share in 2008. Casual games are gaining popularity and market share.
? The item-based revenue model now dominates the market, having being adopted by over 80% of online game titles and contributing over 60% of total online game revenues.
? Sales of domestic online games in overseas markets grew significantly to USD 71 million in 2008. 15 Chinese companies exported 33 game titles to over 40 countries.
? China's online gamers numbered 76 million by year-end 2008, representing 26% of the country's internet population. Young people dominate, with 72% of gamers aged under 25.
? Government efforts to control online game content continue, including censoring pornographic and violent scenes. Censorship imposed on imported titles is stricter than that on domestic games.
? The impact of the current depressed economic environment is mixed. While the number of game users is increasing they are on average spending less. Overall, the online game industry remains the largest and most dynamic Internet sub-sector in China, outstripping online brand advertising and search revenue growth.
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Mar 17 2009
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China's Telecom and Internet Market Forecasts 2009-2013
This report is only available to clients who subscribe to: china, handset, mobile_data, new_media, telecom
* The issuance of 3G licenses in 2009 following the telco restructuring in 2008 will drive sustained growth in the mobile market which will surpass the 1 billion subscription mark in 2013. WCDMA lead the 3G market. * China's WVAS market will grow rapidly thanks to 3G and operator competition and promotion. Music, the mobile internet, and MMS services will lead. * China's handset market is likely to experience a short downturn in 2009 but will bounce back to be one of the most robust markets in the world in the coming 5 years. In 2013 annual sales will total 292 million units. * China's internet users will reach 645 million by 2013. Mobile internet will grow rapidly to account for >40% of all Internet users by 2013. Online games, online brand advertising and online search markets will expand rapidly at a 5-year CAGR of 27%, 24% and 36% respectively through 2013. * Broadband subscribers in China will grow to 209 million by 2013 driven by 3G data card and FTTH. China's IPTV market will have 20.6 million subscribers by 2013, up from 2.6 million in 2008.
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Feb 06 2009
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BDA China 3G Market Forecasts: The New Landscape for 3G
This report is only available to clients who subscribe to: telecom
China's mobile market will surpass 1 billion subscriptions by 2013 with China Mobile holding 66% market share. Total mobile users will reach 1,040 million by 2013, with penetration reaching 76% of the total population. Mobile user growth will decline in 2009 due to the economic downturn but will rebound significantly thereafter driven by increased competition. 3G subscriptions will grow to 247 million in 2013 in China, representing 24% of the total mobile market. W-CDMA will have 142 million users by 2013, with 56 million for CDMA2000 EV-DO and 50 million for TD-SCDMA. In addition to asymmetric regulations, 3G will also help China Unicom and China Telecom to win share in the mobile market from 2010. MNP will help drive China Mobile's market share to fall by 5.1% in 2011. Carriers' strategies and equipment vendors: China Telecom is the most aggressive competing carrier. China Telecom will complete the 3G network in all cities by 2009, while China Unicom and China Mobile will do this by 2010. China Mobile has the strongest marketing and sales strategies; China Telecom offers appealing bundled packages to attract users. China Mobile holds advantages in WVAS development capabilities, that will help it take a strong position in the 3G WVAS market in the long term; China Telecom is catching up.China Mobile and China Telecom have announced aggressive handset subsidy strategies for 3G terminals, while China Unicom has yet to adopt a clear way forward. Huawei and ZTE account for 34% of China's 2G market; BDA expects this figure to increase to 49% in 3G, thanks to their low prices, competitive 3G products and government support. Ericsson turned out to be another winner in the W-CDMA market thanks to it also pursuing a low price strategy.
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Jan 24 2009
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Impact of Economic Slowdown on B2B E-Commerce in China: Slower Growth in 2009
This report is only available to clients who subscribe to: new_media
? This report focuses on third-party online B2B platforms. China's online B2B market reached RMB 4.1 billion (USD 600 million) in 2008. The market saw a robust growth with a CAGR of 49% from 2004 to 2008. Progress made on the political and legal ecosystems for e-commerce provides a positive environment for online B2B development. Alibaba is by far the leader of the third-party online B2B market, accounting for about 70% of the market share. Vertical B2B platforms are expanding into integrated businesses to overcome the cap on their growth potential. ? The rate of revenue growth for online B2B platforms will slow down in 2009, impacted by the economic downturn. After that, the market is expected to rebound with a CAGR of 22% from 2009 to 2013. More consolidation will take place in the future, as some B2B platforms want to scale up their business and industry coverage through M&A. Competition between online B2B platforms and search engines may become fierce in the future as both are being adopted by SMEs as online marketing solutions.
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Nov 03 2008
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Huawei & ZTE: Adopting Different Strategies for the Future of their Handset Businesses
This report is only available to clients who subscribe to: handset
Chinese equipment vendors Huawei and ZTE have seen rapidly growing global handset sales in recent years, mainly through customization for operators. ZTE and Huawei sold 30 million and 20 million unit handsets respectively in 2007. But they still lagged far behind the top five global handset makers and their influence mainly concentrated in emerging market. ZTE has set itself the ambitious target of shipping 100 million units by 2010 and attaining third place in the global rankings by 2012. BDA thinks that an expanding share in China's CDMA and 3G handset markets, rapidly growing sales in emerging markets, and further breakthroughs in developed markets will help ZTE to hit the target figure. Huawei attaches less importance to handset business than ZTE does. Huawei planned to sell a stake in its terminal division to private equity firms but shelved the plan this October, blaming the global financial crisis. BDA thinks Huawei will revive the plan once the economic environment improves and it will be hard for Huawei handsets to maintain the rapid pace of growth if the division is spun off, due to loss of the synergy with the company's other businesses.
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Sep 05 2008
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Climbing the Capex Olympus: Huawei & ZTE
This report is only available to clients who subscribe to: telecom
Huawei and ZTE are sparing no effort in their attempt to climb up the medal table of global equipment vendors. Two key factors are driving Huawei and ZTE forward: strong growth in emerging markets and opportunities arising from the complicated integration of the merged Nokia-Siemens and Alcatel-Lucent. Both Chinese vendors enjoyed robust growth in 2007 and 1H 2008, thanks to relentless international expansion in emerging markets. Continued expansion of China's telecom sector also boosted both vendors, including equipment sales for ZTE of China's indigenous 3G standard. Huawei leapt past Nortel and Cisco to claim fourth place in global carrier sales, a growth of 38% YoY. Huawei's sales outside China were 72% of total, an all-time high. ZTE retained eighth place in global equipment sales on the strength of its infrastructure contracts in Africa which grew by 134% YoY. Global capex is expected to amount to USD 240 billion up by 3.6%in 2008 and will come mostly from Asia-Pacific, Africa and Latin America. Huawei and ZTE are well positioned in these markets and can expect to benefit from this growth.
The wireless sector will grow strongly in 2008, especially in terms of 2G and WCDMA roll-outs. Huawei and ZTE's combined share of global wireless revenue last year was about 12.4%, thanks to progress in winning GSM/WCDMA and even CDMA contracts. Although a far cry from market leader Ericsson's 34% share, there is plenty of scope for further growth. Huawei and ZTE stand to benefit most from China's telco restructuring which will see the awarding of 3G licenses to three full-service carriers.
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Jul 18 2008
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China's Telcos Gun for the Corporate Market
This report is only available to clients who subscribe to: telecom
China Telecom and China Unicom (via CNC) are looking to Corporate ICT (information and communication technology) services to boost growth pressured by the continuing decline in voice traffic. These strengths will bolster both fixed-line carriers from the inevitable attacks from China Mobile. China Mobile may benefit from mobile broadband technologies, although it is burdened with TD-SCDMA for the time being which will defer the competitive challenge. Emerging firms like Alisoft (part of Alibaba) and DigitalChinaBB will challenge fixed-line carriers in the emerging Software as a Service (SaaS) market. BDA believes fixed-line incumbents need to invest more in R&D, a powerful platform and specialist teams to improve their capabilities in order to compete successfully in this crowded market.
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