IT Facts for March, 2006

Consumer spending up 0.1% in February 2006

US Commerce Department said consumer spending rose 0.1% in February 2006, above market expectations for an unchanged reading after January’s warm-weather shopping spree boosted spending by 0.8%. Personal income climbed 0.3%. The price index for consumer spending was up 2.9% in February 2006 from February 2005, slowing from January 2006 3.1% increase.

Asia-Pacific LCD market up 15.6% in 2005

According to IDC, the Asia/Pacific (excluding Japan) PC monitor market totaled 39.8 mln units in 2005, representing an increase of 15.6% over 2004. Despite the ongoing shifts to notebooks, standalone PC monitors continued to experience strong sales through upgrades and replacements, as well as desktop bundling. Branded market vendors for standalone monitors grew 9.1% in unit shipments in 2005 over 2004, and OEM (bundled) monitors grew more rapidly at 25.0% over the same period. Strong LCD growth in the OEM market in 2005 was a major highlight, with shipments exceeding CRT sales, which remained flat over 2004.

The top six branded PC monitor vendors contributed 80.0% of the overall standalone monitor sales in the Asia/Pacific (excluding Japan) region in 2005. Samsung, which topped the market in 2004, held on to the number one vendor position in the branded monitor market for 2005 at 28.0%. Likewise, LG Electronics retained its second spot at 15.4% with Philips making a very close third behind LG. Further down the rankings, Viewsonic and AOC captured fourth and fifth spots respectively, with an immense push by both these vendors in 2005; Viewsonic grew 46.8% over 2004, and AOC by 41.4%. This strong growth is expected to continue into 2006 for Viewsonic and AOC as both vendors have established their positions in the branded PC monitor display business. BenQ finished sixth, after posting nearly identical sales to 2004.

Women more likely to use mobile picture messaging, men more likely to listen to mobile music

More than 75% of all mobile phone service subscribers reported that they would definitely not or probably not switch carriers when their contracts are up. Just over 7% said they would definitely or probably switch carriers. According to NPD Group, 23% of consumers are “completely satisfied” with their wireless carriers and another 44% are “very satisfied.” For those unsatisfied consumers who plan to switch carriers in the next three months, Verizon tops the list of companies consumers say they plan to switch to.

The industry has had success in getting consumers to adopt text messaging, which is important, since SMS traffic generates 37% of all data revenue and nearly 40% of mobile phone users now use text functionality on their mobile phones; T-Mobile leads the US carriers, with just over half of their subscribers using text messaging. 17 mln wireless subscribers currently use picture messaging. Women generate 57% of picture messaging revenue for carriers. Currently nearly 18% of consumers have signed up for a data plan on their wireless phones. Sprint boasts the largest share (25%) of customers with data plans. While still a small percentage of overall consumers, nearly 3 mln subscribers currently listen to music on their mobile phones. Nearly 60% mobile music listeners are male.

24% of Internet users watch videos at least once a week

24% of Internet users access video at least once a week, while 46% watch video at least once a month. News leads the way in frequency of viewing, with 27% of online video viewers watching at least once a week, followed closely by funny videos (26% watch at least once a week). Online video viewing is very common at home (39% of those with home Internet access watch at least once a week) compared to 19% of those who watch at least once a week at work, according to Online Publishers Association.

When it comes to finding the videos they watch, Internet users often rely on a handful of specific sites. Half of all video viewers go to a specific Web site to find video, and 58% say they rely on two to five sites. Another popular way to find video is through random surfing, which is done by 48% of video viewers. Online video advertising is being viewed regularly and leads to specific actions. 66% of video viewers have watched online video ads, and 44% of those have taken action on what they’ve seen. Visiting a Web site ranks highest at 31%, while 8% are actually driven to make a purchase. Video ad watchers generally prefer short ads, however 39% said they would watch ads lasting longer than 30 seconds.

US wireless penetration reaches 70%, 200 mln subscribers

Although the US wireless service provider industry rocketed ahead in 2005, adding approximately 21.8 mln new subscribers, IDC finds the US consumer wireless industry rapidly approaching key turning points in 2006. With subscriber growth slowing and continued voice average revenue per user (ARPU) erosion factors, total voice revenue is expected to decline in the 2008-2009 timeframe.

The US wireless service provider industry had another stellar year in 2005, crossing the 200 mln subscriber and 70% market penetration thresholds, receiving positive market response to the first handset-based 3G applications, and with providers reporting they had crossed the 10% data ARPU level. Another key dynamic in 2005 was that mobile virtual network operators (MVNO) moved into the market entry phase; two key roles that MVNOs will play over the forecast period are to force the broader wireless service provider market to adopt a retail market model approach and to increase the overall level of service provider competition.

6% of US households rely exclusively on cell phones

In 2005, about 8% of US households that subscribe to cellphone service had given up their land-line phones, up from 5% in 2004 and 4% in 2003, according to Forrester Research. More than 6 mln households and nearly 6% of the total US population rely exclusively on wireless phones.

41% of mobile phone owners are interested in videos

JupiterResearch found that 41% of mobile phone users are interested in some form of video service on their mobile phone. The growing demand for video will generate $501 mln in revenues by 2010, up from $62 mln in 2005. Adoption of mobile video on phones has been somewhat low to date with only 2% of mobile phone users claiming a subscription. However, among mobile subscribers 17% were interested in watching “live” TV on their cell phones while 11% indicated interest in short video clips.

Chinese Internet users are online 17.9 hours a week

When Ipsos Insight recently asked people in 12 countries whether they had used the Internet in the past month, 68% of South Koreans said yes. Korea ranked #4, behind Japan (89%), Canada (72%) and the United States (71%). China had a rate of 50%, while India showed just 15%. Korean Internet users, on average, were online for 12.7 hours each week, behind those in China (17.9 hours a week) and Japan (13.9). Canadian Web surfers clocked 12.3 hours each week and Americans were fifth at 11.4, followed by Mexicans at 9.2.

Online job postings up in 28 US markets in February 2006

According to Monster Local Employment Index, online job availability increased in all 28 top US metropolitan areas in February, as recruitment activity in more than half of the major US metro areas tracked jumped significantly. During the past month, all 28 markets saw a moderate-to-dramatic rise in online job demand. Metro areas in the western and southern regions of the country experienced the sharpest growth, while California markets, such as Sacramento, San Diego and San Francisco all rose considerably, surging seven points each, due to strong online demand for IT, business and professional services occupations. Cleveland, Houston, Indianapolis, Kansas City and New York City increased by six points each during February, while Atlanta, Chicago, Dallas, Detroit, Miami, Minneapolis and Orlando all registered growth of five points. The remaining markets increased between one and four points each.

Employment index in 28 US metropolitan markets

Market Feb 06 Jan 06 Dec 05 Nov 05 Oct 05 Sep 05 Aug 05 Jul 05 Jun 05 May 05
Atlanta 108 103 104 105 106 104 103 101 100 100
Baltimore 106 103 105 107 105 103 101 100 101 99
Boston 105 102 103 104 105 103 101 100 100 100
Chicago 105 100 102 104 104 102 100 99 99 101
Cincinnati 107 103 103 106 106 106 104 102 101 99
Cleveland 105 99 99 101 101 102 102 99 100 100
Dallas 107 102 104 104 103 100 100 99 100 100
Denver 109 105 103 108 107 106 104 101 102 98
Detroit 109 104 102 108 108 107 103 104 101 99
Houston 111 105 105 105 102 100 100 100 100 100
Indianapolis 107 101 104 104 104 101 100 98 99 101
Kansas City 106 100 101 103 103 102 101 101 100 100
Los Angeles 107 104 104 107 105 103 102 100 101 99
Miami 108 103 103 101 103 103 101 98 102 98
Minneapolis 111 106 106 109 108 107 105 102 101 99
New York City 106 100 102 104 103 101 102 99 100 100
Orlando 104 99 98 100 98 100 100 99 104 96
Philadelphia 106 105 104 104 104 102 101 100 101 99
Phoenix 112 110 111 112 109 106 104 101 100 100
Pittsburgh 110 106 104 107 106 104 103 101 100 100
Portland 109 105 106 106 107 104 103 100 100 100
Sacramento 113 102 103 105 104 101 101 99 101 99
San Diego 115 106 108 109 108 106 104 100 101 99
San Francisco 111 104 105 105 105 103 102 100 101 99
Seattle 112 108 107 108 108 107 105 102 101 99
St. Louis 108 104 102 104 104 102 101 100 100 100
Tampa 108 106 104 105 105 102 102 99 100 100
Washington, DC 105 102 102 104 105 103 102 102 101 99
Source: Monster

Wireless revenue from US businesses will grow to $52 bln in 2010

The business market is poised to play an increasingly important role in the US wireless industry as total subscriber growth slows. With the consumer wireless market approaching saturation, service providers will focus on the business market and its attractively high voice average revenue per user (ARPU) and still early-stage adoption of data as primary growth drivers. Business revenue is expected to grow from $29 bln in 2005 to $52 bln in 2010, IDC says. Growth will be higher for businesses than for the overall market due to stronger subscriber growth rates within this segment. However, revenue growth rates will slow from 19% in 2006 to 3% in 2010 as subscriber growth rates slow and pricing erosions impact ARPU and revenue growth.

76% of Americans bought gift cards in 2005 holiday season

According to Stored Value Systems, 80% of US consumers said they would rather receive a gift card to their favorite retailer than any other kind of gift. 76% of adults purchased gift cards in the 2005 holiday season. 91% of adults who had received holiday gift cards had redeemed them before the end of February 2006. 75% of recipients made sure they used up the card completely. 80% of people would rather get a gift card to a favorite retailer than any other kind of gift. More than 50% of respondents say that they always or often add their own money when making a purchase with a gift card. Of those purchasing holiday gift cards, 67% bought them in early December 2005. 68% of adults prefer or bought gift cards with an appropriate holiday design. 80% say that they spend more (33%) or the same amount (47%) on a gift card than they would on an alternate gift. Those who received gift cards during the 2005 holiday season were given an average of 2.6 cards, with an average value of $42.32. 91% had redeemed their gift cards before the end of February 2006.

PC market up 9.1% in Japan in 2005

The Japan PC market expanded in 2005 with shipments increasing by 9.1% YTY, according to IDC. The demand for home PCs recovered in 2005, following the strong demand for consumer electronics caused by the Olympics in 2004. The home PC market had its first positive growth after four consecutive negative years with shipments of 5.6 mln units, increasing by 13.6%. The growth in 2005 was also the result of increased shipments by major PC vendors, which started selling “spring models” in December 2005 instead of January 2006. The business PC market declined from double-digit growth in two consecutive years to 6.3%. In the large companies, many PC replacements were completed in Q1 2005, and the demand for PCs for securities under the Information Protection Law also slowed in the second half of 2005.

40% of French fixed line market to switch to VOIP

Some 40% of France’s overall market for traditional fixed-line phone calls will switch to calling using Internet technology this year from about 15% in 2005, according to France Telecom.

PC market in Brazil up 36% in 2005

IDC found that the PC market in Brazil grew 36% YTY in 2005. More than 5.5 mln PCs were shipped in Brazil, split between notebooks and desktop computers.

Search engine market shares in February 2006: Google - 42.3%, Yahoo! - 27.6%, MSN - 13.5%

Google’s share of the search market rose to 42.3% in February 2006 from 36.3% in February 2005, according to ComScore. Searches on Yahoo 27.6% of the market, down from 31.1% in February 2005, while queries on MSN fell to 13.5% from 16.3%. Ask.com was the only other search engine to gain share, to 6% of the market from 5.3% in February 2005.

Top network-ready countries: USA, Singapore, Denmark, Iceland

Every year the World Economic Forum publishes a Networked Readiness Index (NRI), covering a total of 115 economies, to measure the degree of preparation of a nation or community to participate in and benefit from information and communication technology developments.

Network readiness index

Country Index
United States 2.02
Singapore 1.89
Denmark 1.80
Iceland 1.78
Finland 1.72
Canada 1.54
Taiwan 1.51
Sweden 1.49
Switzerland 1.48
United Kingdom 1.44
Hong Kong SAR 1.44
Netherlands 1.39
Norway 1.33
Korea, Rep. 1.31
Australia 1.28
Japan 1.24
Germany 1.18
Austria 1.18
Israel 1.16
Ireland 1.15
New Zealand 1.14
France 1.11
Estonia 0.96
Malaysia 0.93
Belgium 0.87
Luxembourg 0.80
Portugal 0.56
United Arab Emirates 0.54
Chile 0.52
Malta 0.51
Spain 0.47
Czech Republic 0.36
Cyprus 0.36
Thailand 0.35
Slovenia 0.34
Tunisia 0.33
South Africa 0.30
Hungary 0.27
Qatar 0.25
India 0.23
Slovak Republic 0.19
Italy 0.16
Greece 0.08
Lithuania 0.08
Mauritius 0.07
Kuwait 0.06
Jordan 0.03
Turkey 0.00
Bahrain 0.00
China ?0.01
Source: WEF

30% of potential buyers pay more attention to relevant ads

People planning to buy an SUV are 30% more likely to remember the brand featured in an SUV ad than are those with no such plans, according to Television Bureau of Advertising.

UK online ad market up 66% in 2005, reaches $2.39 bln

UK online advertising spending surged 66% to $2.39 bln in 2005, giving it a 7.8% market share — ahead of radio, consumer magazines and outdoor ads. Internet ad spending had a market share of 4.9% in 2004. Growth was driven in part by classified ads, which grew by 62.4% to 262.2 mln pounds, the Internet Advertising Bureau said. Print classifieds fell 5.1% in 2005. search marketing through search engines saw the biggest gains, growing 78.8% to 768.4 mln pounds in 2005. Recruitment was the biggest online ad category with 22% of the market, followed by finance (17.4%), automotive (12.4%) and entertainment and media (10.2%).