Government Digitization Efforts to Spur Turkish IT Growth in 2014 as Demand for Cloud Services Rises and Focus on Mobile Security Intensifies, According to IDC
22 Dec 2013
International Data Corporation (IDC) today offered the first of its annual predictions for the coming year for the Turkish information and communications technology (ICT) industry. IDC's predictions for 2014 were heavily influenced by the 3rd Platform, the industry's emerging platform for growth and innovation built on the technology pillars of mobile computing, cloud services, Big Data analytics, and social networking.
"The Turkish ICT market has expanded notably over the last few years, driven by strong consumer demand for smart devices, landmark government investments, and buoyant private sector spending," says Nevin Cizmeciogullari, country manager for IDC Turkey. "Hardware spending in the consumer space will be the main growth driver of the overall ICT market in 2014, followed by the public sector's ongoing digitization efforts. Telecom services will see relatively flat year-on-year growth of just 1.2%, which can be attributed to the decline in fixed and mobile voice spending. Meanwhile, an increasing number of complex IT projects such as Big Data implementations, datacenter transformations, network modernizations, IT security and cloud initiatives, and the mobilization of business processes will spur growth in the IT services and software markets. At the same time, the service diversification strategies of telecom operators will intensify the market's competitive pressure and create a co-opetitive environment."
IDC's Turkey predictions for 2014, presented by Cizmeciogullari at a press conference today, include the following:
- ICT spending growth in 2014 will be driven by the tech-savvy consumer and public sector's increased focus on IT – The value of the Turkish ICT market will exceed $28.6 billion next year, up 4.2% year on year. IT spending will exceed $11 billion, growing 8.6% over 2013 owing to a surge in demand for smartphones and tablet PCs in the consumer segment. There will also be numerous multimillion mega projects getting underway during the next couple of years as part of the Turkish government's eTransformation initiatives.
- Demand for public and private cloud services will increase, driven by large enterprises, but cloud providers will be challenged by lack of SMB adoption in the short term – Large enterprises in the private sector will heavily invest in private cloud solutions and move beyond virtualization, while public cloud services will be mostly used for relatively less mission-critical tasks such as email and customer relationship management (CRM). On the other hand, the pace of cloud adoption by SMBs will be slower than expected.
- Mobile security will move to the top of the CIO agenda as a result of the much accelerated growth of mobile devices in the country – As a result of the increasing use of mobile devices such as smartphones, laptops, and tablets, organizations have begun to encounter more mobility-driven IT security problems. In 2014, workplace mobilization will drive IT infrastructure transformation projects, which will result in the implementation of advanced security measures.
- The 'all-in-one-box' concept will be prevalent through increased usage of converged systems solutions – More simplified infrastructure and improved management of IT resources with enhanced operational efficiency will drive demand for converged solutions as the 'bundling' nature of integrated systems makes buying economical, and ensures each technology will work together.
- 'Smart Cities' concept will have a higher priority in the Turkish government's agenda to drive urban competitiveness – In 2014, the discussion around Smart Cities will move to the next level, and ICT suppliers – particularly telecom operators and international hardware and software vendors – will jointly allocate resources to developing the ideal Smart Cities project and showcasing their capabilities in this domain.
- Government's cybersecurity initiatives will drive IT security spending in public and private sectors – Over the last two years, a significant number of organizations across different verticals have been victims of high-profile IT security incidents. These attacks drew attention to organizations in the public and private sectors, and the Turkish government has decided to publish a cybersecurity action plan in 2014. IDC predicts that this initiative will create awareness in the Turkish IT market and drive an increase in IT security software spending.
- The verticalization of telecom services will be a reality in 2014 – Turkish telecom operators will target 100% of the enterprise ICT wallet. Solution bundles, which are combination of IT and connectivity services, will be customized to suit the specific requirements of the targeted verticals.
- OTT will gain more traction due to the rapid growth of mobile Internet services – The rapid growth of the mobile broadband services, when combined with the country's large young population, presents significant growth potential for providers of over-the-top (OTT) content services in Turkey. IDC believes that the prevalence of conditions conducive to OTT services will generate further interest among telecom operators and ISPs in 2014.
- Shrinking margins will force vendors to offer more innovative solutions focused on managed print services – This will drive vendors to rapidly expand their solutions portfolios and adopt a vertical-focused business model. IDC believes that this approach will drive dynamic growth in the print services and document solutions market in Turkey.
- Consumer spending will continue to shift quickly toward tablets, causing PC shipments to decrease more quickly than anticipated – The volume of the tablet market will grow at a robust rate of 41% year on year in 2014, which marks Turkey out as one of the world's fastest growing tablet markets.
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