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Deloitte 2010 Technology, Media & Telecommunications Predictions Show Unexpected Challenges for Businesses and a Glimpse of 2011

Continued congestion in mobile phone networks, vibrant tablet computer sales and modest demand of eReaders have all manifested as predicted. However, demand for cloud computing has been more limited so far, and mobile search has experienced slower progress, at least for the first half of the year.

Continued congestion in mobile phone networks, vibrant tablet computer sales and modest demand of eReaders have all manifested as predicted. However, demand for cloud computing has been more limited so far, and mobile search has experienced slower progress, at least for the first half of the year. These are the findings announced today by Deloitte in the Deloitte 20/20 Technology & Innovation podcast, an update to the Technology, Media & Telecommunications Predictions 2010 report launched in January 2010. The podcast assesses the predictions and what these mean for innovation and business. 
“Unexpected consumer adoption patterns and government fiscal constraints are prevalent as we move into the second half of 2010,” said Paul Lee, Director, Technology Media and Telecommunications (TMT) Research for Deloitte LLP (UK). “In order to remain competitive, companies need to quickly address these issues, make the necessary changes to their business model, and provide consumers with the products and services they want, at the price point they are not just willing to accept, but which is sustainable.”
Commenting on the much higher than expected tablet sales, Duncan Stewart, Director of Research, Technology, Media & Telecommunications, Life Sciences and Greentech group, Deloitte Canada said, “Consumers are realizing that tablet computers are much more than toys and can be used as business tools. Benefits such as a ten-hour battery life and wide functionality make this an appealing product for an increasingly mobile workforce.”
The key points addressed in the podcast are below. 
Mobile Data Congestion
The awareness of mobile data congestion is varied around the world. It is most acute in Western Europe and North America, but less so in developing countries, even though some emerging markets are starting to promote low cost, all you-can-eat-data packages. However, by 2014-2015, mobile data congestion is likely to be a significant problem everywhere around the globe.
Tablets
Tablet sales are much higher than expected and will have a significant impact on the computing industry. In January, Deloitte predicted that sales would be in the double digits for the first year, more than 10 million units, while Wall Street’s estimates were much lower at approximately one million. Sales were three million units in the first 80 days alone. Deloitte now expects 12-13 million units sold within the first year, with annual sales of 40-50 million devices per year two-to-three years out.
Cloud Computing
Government and enterprises have been more cautious in adopting cloud computing─the delivery of computing services over the Internet─than consumers. Deloitte predicted that cloud computing was going to grow by 50 percent to a US$70-80 billion industry. Companies are still looking at cloud computing but concerns over security, vendor lock-in, and portability are still significant and slowing uptake.
Mobile Search
There has been much debate, and little progress about how to monetize advertising in the mobile sector. One approach has been advertising adjacent to a search, while another is advertising within the application. This may change, however, in the second half of the year, particularly as the volume of smart phones shipped continues to accelerate.
eReaders
Manufacturers have cut prices much faster and sooner than expected. Now, an eReader can be purchased for approximately US$150, and by the second half of the year, the price is expected to be in the US$99 range. Pricing will determine the growth and sales of this product. In the first 80 days of its introduction, tablet sales matched the total eReaders sales since it was introduced 5 years ago.
2011

Every year, the Deloitte TMT industry group releases its annual predictions, which are drawn on internal and external inputs from conversations with member firm clients, contributions from Deloitte member firms’ 7,000 partners and managers specializing in the TMT sector, and discussions with industry analysts, as well as interviews with leading executives from around the world. The findings of the podcast were drawn from primary and secondary research. 
As used in the release, “Deloitte” means Deloitte Touche Tohmatsu, a Swiss verein. 
About Deloitte 20/20 
The Deloitte 20/20 series identifies critical business issues and captures “Insights that prepare you for tomorrow,” with high-value perspectives to support business decision making and long-term success.
About Deloitte 
Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/aboutfor a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms. 
Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than140 countries, Deloitte brings world-class capabilities and deep local expertise to help clients succeed wherever they operate. Deloitte’s approximately 169,000 professionals are committed to becoming the standard of excellence.

Posted by on July 12, 2010.

Categories: Technology

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