PRES Canada US Market

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Information about PRES Canada US Market

Published on October 29, 2007

Author: Kestrel


Slide1:  North American Market – Overview and Opportunities for Australian ICT companies Michelle Pflaum – Austrade SF US Tech Sector has taken a beating:  US Tech Sector has taken a beating This downturn stands in stark contrast to the high growth driven by the Internet boom, Y2K upgrades, ERP build-outs, and unbridled economic prosperity. The technology investment binge was stopped in its tracks in 2001 by: A corporate liquidity crunch. Consumer PC saturation. • Dot-com’s spending termination. • Telecom’s capacity glut. And in the last 18 months we are seeing: Dismal earnings reports Continued announcements of layoffs Slowdown in VC investment CEOs worrying about the future Frightened investors dumping stock And growth has plummeted:  And growth has plummeted Source: Forrester Research, 24 Oct 2001 Outlook brighter for Q3/4 and 2003 :  Outlook brighter for Q3/4 and 2003 Second half of 2002 is likely to be a much more stable and improving environment for technology companies. Stabilisation in demand across most sub-sectors plus a modest level of inventory rebuilding suggests that the aggressive cost cuts of 2001 will show through in earnings growth as the year progresses. According to Mercury News, tech goods…..computers, software, semiconductors, services…-- should set a record at $1 trillion, exceeding the total for the peak of the bubble in 2000. It means sales should grow nearly 9 percent. Innovative Australian companies are still doing deals in the US:  Innovative Australian companies are still doing deals in the US Ephox (content management technology) signed several deals in the US, the most recent being a partnership with Kana announced today. Opcom (transit and transportation technology) technology recently implemented by Chicago Metro. Astracon (OSS solutions for broadband and IP networks) closed US$10M in funding in June, led by Cisco, Geocapital Partners and Edgewater Funds. Quantm (route optimisation technology) California High Speed Rail Project Maxamine (website analysis technology) technology product sold for use by EDS who is now on-selling it to their customer base. SigPoint (NDT - non-destructive testing technology for use by energy and heavy industries) signed partnership agreement with Sun Microsystems (USA). …and in Canada:  …and in Canada Parrimark (conference management software) Lochard (noise monitoring/tracking) Adacel (eg training simulators, control systems software) ERG systems (fare collection systems) Eracom (cryptographic software and hardware) Prophecy/open (e-deployment, back office solutions) Redflex (touchscreen products) Mincom (mining software) Tower software (document management systems) Australian ICT in Canada And there are many niche sectors of opportunity for Australian companies:  And there are many niche sectors of opportunity for Australian companies Niche sectors and vertical markets where Australian companies are gaining market share against incumbent US and Canadian firms Billing Telco networking Law enforcement Security Wireless and satellite technologies Outsourcing Imaging systems Geographic Information Systems Internet infrastructure Education Transportation Banking and finance software Mining Key Tech themes for 2002-3:  Key Tech themes for 2002-3 A general inventory rebuild will drive production ahead of end demand. 3rd generation wireless gets pushed out further. Communication Equipment spending declines again. Consumer consumption surprisingly good. Venture recapitalisation's. Intensified hardware and networking consolidation. More modularized and rentable applications. Demand for storage to outpace servers in the enterprise. Web Services proliferate. Canadian Market Overview:  Canadian Market Overview Total industry revenue ~can $116 billion (~US $77 bil.) Industry growth - compound 11% rate annually 26,000 establishments Second most wired nation in the world World’s longest fiber optic network 1 in 6 Canadians use wireless devices Similar business culture Place in north American market Canadian ICT Industry Revenue by Sector Can $116 Billion:  Canadian ICT Industry Revenue by Sector Can $116 Billion Last updated November 2000 Regional Hubs:  Regional Hubs Calgary Computing Devices Canada Harris LSI Logic Nortel Networks (Wireless) Novatel Sanmina Smart Technologies Wi-Lan Vancouver Electronic Arts Canada MDSI Mobile Data Infowave Software Seagate Software Pivotal Sierra Wireless PMC Sierra Spectrum Signal MacDonald Dettwiler Processing 360networks Inc. Kitchener-Waterloo Com Dev Open Text Dalsa PixStream Electrohome Raytheon Canada NCR Research in Motion Ottawa Cisco Mosaid Cognos Newbridge/Alcatel Corel Nortel NetworksCRC NRC Crosskeys Philsar Semi. Jetform QNX Software JDS Uniphase Siemens Mitel Tundra Toronto 724 Solutions GEAC Alias Wavefront Gennum ATI Technologies Hewlett-Packard Celestica Hummingbird IBM Certicom Extend Media Lucent Montreal BCI Matrox SR Telcom BCE Emergis Motorola Teleglobe CGI Microcell TIW CIGR MPB Viasystems CITR Nortel Networks Virtual- C-MAC Positron Prototype Eicon Primetech Ericsson Softimage Marconi Comm. Atlantic Provinces ComDev Wireless Litton Sys. Deltaware Sytems Nautel DMR Group Nautical Data InfoInteractive Satlantic Instrumar Simscape JOT Inc. Tecknowledge Health KnowledgeHouse xWave Edmonton Alberta Microelectronics Corp. CEL Corp Computronix Intuit Canada Logican Sentai Software Corporation TR Labs Wiband Communications Source: DFAIT, Canada, 2000 Canadian Market: Telecommunications and Networking Equipment:  Canadian Market: Telecommunications and Networking Equipment ~ C$ 5 billion of imports annually (10% growth) Leader in high-capacity broadband switches Fiberoptics prowess Wireless devices Semiconductor design Satellite technologies Canadian Market: Software and Multimedia:  Canadian Market: Software and Multimedia Graphics, Document Management, ERP, Cryptography, Tools Strong Verticals - eg financial services, retail systems Outsourcing is leading growth sector, followed by application software and professional services Multimedia Industry Concentration Broadband capacity growth On-line marketing opportunities World-class design schools Canadian Market: Internet and E-commerce:  Canadian Market: Internet and E-commerce 43% of Canadians are on the web at least once a month Moving rapidly toward high-speed access in 2003, 40% of households are expected to use high-speed 2nd to US only in e-commerce sales On-line procurement growth Government initiatives (eg LibraryNet, HealthNet, SchoolNet) 35% of small businesses are connected to the Internet Australia-US Tech Trade & Investment :  Australia-US Tech Trade & Investment Approx. 15 Aust companies on NASDAQ, 5 on NYSE 150 + Aussie tech companies with a presence in the market Majority in Silicon Valley, Seattle, Virginia, Boston, Denver, Dallas, New York, San Diego and Los Angeles Typical model is to place sales & marketing and support in US and leave R&D in Australia High potential sectors where Australian companies have strengths include eLearning, EHealth, Government solutions, EAI/ XML, Data Storage, Security, Games, Entertainment, Gaming, Australian Trade Commission Planning for US Market Entry:  Planning for US Market Entry Research your target market segment . Understand your competitors and how they sell Select events, conferences and promotional activities where you can connect with industry players. Develop a partnering and distribution strategy. Protect your IP Purchasing decisions are back to basics:  Purchasing decisions are back to basics Today, many user organizations have come full circle. They have gone back to placing IT in its more traditional role,one of cost containment, customer retention and optimization of existing business processes. In this new environment, the selection criteria for acquiring technology is focused on the following: Return on investment. Speed of implementation. Automation of existing business processes. Solutions that actually work. In summary, total IT spending will be characterized by more modest growth, with a few individual technology categories experiencing rapid acceleration. Success for resellers will depend on knowing which specific markets to target. As a result, sector selection will be a priority this year and beyond. US Channels have some unique issues :  US Channels have some unique issues US Sales regions are often much larger than country regions elsewhere in the world Channel companies pay State sales tax in every State in which they sell product,. Average added State tax in 2001 was 8.5% Channel companies rely on vendors for most of the post-sale support Most buy packaged software through Ingram Micro and Tech Data Many buy software from their OEM vendors at a discount Software publishers maintain field sales forces, or outsource sales support teams, to keep training current (as well as web training) Software retailers expect vendors to do business with their entire national chain, not just select stores Reference: Pittiglio Rabin Todd and McGrath Austrade ICT Team Americas Events:  Austrade ICT Team Americas Events Australia September -Elearning Seminars Sydney, Melbourne, Brisbane October - “Exporting IT - Global ICT Team Roadshow”  Australia February - “Whats Hot - Global ICT Roadshow” + “Selling to Government”  Australia March - Latin American ICT Tour Australia May - Whats Hot - Global ICT Roadshow + AIIA Showcase/ CeBit Show Australia USA October- KM World and Intranets 2002/ SVHTT Santa Clara October - High Tech Commercialisation Tour San Francisco, Boston November - Comdex/ SVHTT Vegas/ SFO February - SVHTT/ Greater Washington Washington March - FOSE/ High Tech Tour Washington April - RSA Secruity San Francisco May - E3/ SVHTT LA June - SVHTT/ ANZATech Conference San Francisco CANADA October - Technology in Government Week Canada November - Comms 2002/ High Tech Tour Canada For more information on Austrade ICT Events visit: Austrade ICT Team Services:  Austrade ICT Team Services Here are just some of the things we can help you with: Market selection Market analysis Competitive analysis Market entry strategy Partner identification Visit programs Tailored event services Foreign language services Financial assistance – EMDG, VC advice Setting up an overseas office An investment in our services can save you time and money. For more information on Austrade Services for ICT companies visit:

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