Managed security boom hits 20% CAGR

THE managed security services market in Australia will expand at a compound annual growth rate of 20 per cent until at least 2013, according to new research from analyst group Frost & Sullivan.

The Asia Pacific Managed Security Services 2006-2013 found revenues in the Australian market were $240 million in 2006 and were forecast to grow to $880 million by the end of 2013.

While the managed security services (MSS) market was still in its early stages of growth in the region, Frost & Sullivan analyst Arun Chandrasekaran said the MSS model had started to gain wide acceptance, particularly in advanced countries like Australia, Japan, Singapore and Hong Kong.

The potentially enormous market in India had also showed promising growth on the back of ongoing liberalisation in the telecommunications sector.

“Additionally, there is a growing realisation that information security investments should no longer be viewed as IT investments but more strategically in the business risk context,” Mr Chandrasekaran said.

“Engaging with a strong MSSP allows organisations to share risk management and gain access to skilled resources for risk mitigation,” he said.

Mr. Chandrasekaran said globalisation and mobility, small and medium-sized businesses faced the same issues as larger enterprise – like fading security perimeters, complex converged networks and data security issues”.

“Hence the security requirements for SMB in Australia are not too different from the large enterprises. However, the awareness levels and willingness to pay still separate these two horizontal segments.”

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Asia reaches 1.1b mobile subscribers

THE fast growing Asia-Pacific mobile telephone market shows no sign of slowing and will boast more than 1.14 billion subscribers by the end of the year, according to research group Frost & Sullivan.

The company said subscriber growth in the region had been driven by dramatically falling mobile call costs, reduced handset prices, and the expansion of network infrastructure in key emerging markets like India and Indonesia.

The region remains one of the few truly fast growing regions in the world, with booming economies, large populations and still small mobile penetration rates.

The report highlighted the remaining potential for growth.

For example, with 142 million subscribers, India overtook Japan as the region’s second biggest mobile market after China. Yet mobile market penetration in India is just 13 per cent, meaning the market is still largely untapped.

The Frost & Sullivan Asia Pacific Mobile Communications Outlook 2007 study looked at 13 major regional economies. The report found Subscriber numbers across the region had growth at a compound annual rate of 24 per cent between 2002 and 2006.

“The impact of the emerging markets on the rest of the region is likely to grow in significance as regional carriers search for sustainable growth, and as economies of scale further drives down 3G handset prices,” said Frost & Sullivan industry manager Janice Chong.“

“Of the expected 190 million net subscriber additions in 2007, 90.8 per cent are likely to stem from the emerging markets” Ms Chong said.

Mobile broadband is likely to be the next killer application in the region’s promising mobile landscape. The business case for 3G may not lie in 3G itself, but in 3.5G – commonly known as high speed downlink packet access (HSDPA).

“HSDPA and WiMAX (worldwide interoperability for microwave access) are expected to play a prominent role in 2007, given the number of trials that have taken place in 2006,” Ms Chong said.

While the launch of HSDPA has taken precedence in certain countries, WiMAX may still be the focus in emerging markets like India and Indonesia.

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AsiaPac governments drive smart home projects

GROWTH in the Networked Home market in the Asia Pacific is expected to outstrip other geographies as governments in the actively back initiatives in home networking R and D and deployment services.

Consulting group Frost and Sullivan analysis says although the market is in its very early stage of development there were encouraging growth signs as Asia Pacific governments threw support behind the technologies.

South Korea remains the regional leader in home networking in terms of both research and development and consumer adoption, the group says, with the South Korean government – along with industry consortia – the biggest proponent in shaping the industry.

Home networking is seen by service providers as the next market frontier, and governments see it as the likely catalyst for moving their industry’s up the broadband value chain.

Governments are looking at home networking as the driver for greater adoption of current and next-generation broadband connectivity, which would in turn drive the convergence of services from computing to consumer electronics, networking, IT, telecommunications and entertainment, Frost and Sullivan said.

Affluent consumers’ lifestyle needs for a ‘smart home’ with entertainment, productivity, home automation and connectivity were urging their service provider to move up that broadband value chain, Frost and Sullivan industry analyst Krishna Baidya said.

One of the biggest hurdles to pushing the market forward would be in educating consumers of the home networking options. It was critical that service providers, device vendors, networking companies and software developers worked closely with each other to make sure that home users “enjoy a plug and play experience,” Baidya said.

“As the success of individual market players in the value chain is tied-in with how the industry evolves with rest of the participants, it is important that they collaborate closely even while they may be competing in many fronts,” Baidya said.

“The growing convergence of networking and consumer electronics is facilitating the union of different industry players.”

“The growing convergence of networking and consumer electronics is facilitating the union of different industry players.”

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Local online ad market tops A$1 billion

THE online advertising sector grew to more than $1 billion in Australia for the first time last year led by staggering growth in the paid search market, according to global researchers Frost and Sullivan.

The company’s Australia Online Advertising Market report found total online revenues grew by 62 per cent in 2006 to $1.01 million and are expected to triple to $2.95 million in 2010.

Strong growth was seen in all the main product segments: paid search led by growing more than 100 per cent, followed by general advertising (48 per cent); directories (60 per cent) and classifieds (49 per cent), the report found.

The explosive growth in paid search was due mainly to search engine pay-per-click keyword advertising, which outpaced both contextual search and paid directory listings.

Google was the biggest winner in the local online advertising market, growing to become equal market leader in Australia with Telstra’s online unit Sensis.

Employment classified specialist Seek became the third largest online publisher in Australia, overtaking Fairfax Digital and NineMSN, according to Frost and Sullivan Australia research director Darryl Nelson.

“The strong jobs market in Australia in 2006 drove the classifieds segment, which accounts for 30 per cent of the total online advertising market,” Nelson said.

“Our observation of the market points to paid search continuing to see strong growth in the future, we estimate paid search revenues to grow to $975 million by end-2010, a compound annual growth rate (CAGR) of almost 40 per cent,” he said.

The Frost and Sullivan survey was carried out late last year with senior management level executives split between existing online advertising users and non-users. A total of 462 respondents participated in the survey which looked at advertiser usage patterns, attitudes and intentions.

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