[Marketing] Peru Information Technology Report Q4 2009

[Sean DALY]

http://store.businessmonitor.com/products/?action=show&product_id=1133&keyword=peru
http://www.companiesandmarkets.com/Summary-Market-Report/peru-information-technology-report-q4-2009-162242.asp

of note: OLPC government purchases 80% of first half 2009 netbook sales.

some out-of-date statistics in this abstract though


abstract text:

Peru's IT spending is forecast to remain in positive territory in
2009, driven by double-digit PC sales growth. Peru has one of the
smaller IT markets in the Latin American region, but spending is
projected to grow at a compound annual growth rate (CAGR) of 13% over
the 2008-2013 period, making it one of the highest growth global IT
markets. Total spending on IT products and services is forecast to
pass US$1.8bn by 2013. Despite strong growth in recent years, a PC
penetration rate of less than 20% indicates that there is plenty of
potential for further development. The market has a significant
geographic digital divide, with largely untapped markets beyond the
capital Lima, which accounts for at least 80% of all PC sales. The
government purchase of netbooks through the One Laptop Per Child
(OLPC) programme was the key driver in H109 and accounted for more
than 80% of netbook shipments. Peru's IT market appears better placed
than most others in the region to withstand the current global
economic headwinds. Per capita IT spending is projected to grow to
US$58 by 2013, from around US$38 in 2009. The regional structure of
the market will evolve, with slower growth likely in Lima, compared
with the Peruvian provinces. Industry Developments The government was
expected to purchase up to 200,000 PCs for schools in 2009 through the
OPLC programme. In Q109 OLPC reportedly distributed more than 70,000
netbooks in Peru, and by July the total had reached around 110,000.
The procurements brought the total number of purchased through the
programme to around 250,000. Peru's government continues to focus on
its agenda of information and communication technology (ICT) for
development. In 2008, the government re-launched a tender to roll out
broadband to more than 1,000 rural communities. The contract is
expected to initially connect 1,050 rural communities in Peru at a
cost of around US$11.5mn. Another government priority this year is to
strengthen the domestic software sector. Total domestic sector output
was projected by Peruvian software promotion agency Apesoft to reach
around US$180mn in 2008, up from US$130mn in 2007. Software industry
exports were expected to have been around US$20mn, representing about
25% growth from the previous year's total of US$16mn. Competitive
Landscape Netbooks are expected by most vendors to be the biggest
growth driver in 2009, but because of the OLPC programme, but
multinational brands had only a small share of this market in the
first half of the year. Sales of netbooks outside of the OLPC
programme were only around 10,000 a month. Acer reportedly was the
brand netbook leader with a less than 5% share. Software market leader
Microsoft has predicted double-digit growth for Peruvian software
sector sales this year, and in July 2009 said that it would strengthen
its local operations. In 2008, Microsoft signed a deal with Peru's
education minister to supply Windows software for XO laptops
distributed as part of the 'One Laptop Per Child' programme, the first
time that these computers have been distributed with Windows. As
Peru's installed computer hardware base expands, the country should
attract more investment from regional IT services players. In 2009
Colombian IT firm Consult-soft was reportedly considering opening an
office in Peru to provide Oracle-based enterprise resource planning
(ERP) and customer relationship management (CRM) consultancy and
software services. Meanwhile, Chilean IT services provider Solint
planned to open an office in Peru in 2010. Computer Sales BMI projects
that computer hardware will be the main driver of Peruvian IT spending
this year, thanks to a large government procurement of notebooks from
the OLPC programme. Peru's computer sales are projected to reach
US$823mn by 2013, growing at a projected CAGR of 13%. In H109, the PC
market surged with year-on-year (y-o-y) notebooks shipments growth in
the region of 50%, although desktop shipments declined. Annual PC
sales are projected to reach 1mn by 2013. Growing affordability has
much to do with this. Laptop prices have virtually halved since 2006,
when the average price was around US$1,200, compared with around
US$650 in 2008. Government programmes and demand outside the capital
Lima is likely to fuel growth over the next few years. Software Peru's
software market is projected to be worth US$124mn in 2009, with the
market reaching a value of US$210mn by 2013. Growth is expected to be
relatively subdued in 2009, at less than 5%, but there will continue
to be areas of opportunity, not least due to the continued expansion
of PC sales. Peru is also one of the fastest growing regional markets
for ERP solutions, with growing regional competition, and
opportunities, a result of the US free trade agreement (FTA), fuelling
investment. Faced with more, and often larger, competitors, even
smaller Peruvian exporters will want to reduce costs and gain
competitiveness. There should be a demand to improve processes such as
finance, accounting, sales and inventory. The majority of current
demand, in functional terms, is for ERP and supply chain management
(SCM). There is a small but growing market for custom solutions. IT
Services Peru's IT services market is projected to grow at a 16% CAGR
in the 2009-2013 period. For a developing market, the percentage of IT
market revenues generated by services is high, at around 32%, although
this is in line with the region and lower than for Brazil. The
economic situation may have an impact on projects in some verticals,
with the economic slowdown reducing demand for 'intangible' services
such as consulting, but also driving outsourcing from some US
organisations.The growing level of investment in recent years in
corporate management solutions is translating into demand for support
and maintenance as well as more sophisticated IT services. E-Readiness
Recent data from Peru's national statistics institute, IENI, suggests
that nearly 75% of internet users use a public access point, compared
with just 18.8% of users who use the internet at home, and 12.1% at
work. Mobile telephony penetration is continuing to increase
significantly and was up to 45.02% in Q307, up 31.3% y-o-y. The World
Economic Forum ranked Peru 78th in the world in its most recent survey
of 'e-readiness', but cited improvements in some institutions
including those within the judicial, police and educational spheres.