IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
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Market Pulse: #12 March 2014
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Introduction .......................................................................................................... 3
Executive Summary ............................................................................................... 3
Market Pulse Index................................................................................................ 3
Demographics ....................................................................................................... 5
1.
By Geography ......................................................................................... 5
2.
By Role ................................................................................................... 5
3.
Market Segments ................................................................................... 5
4.
By Scale .................................................................................................. 6
Projects ................................................................................................................. 7
1.
ICT Infrastructure Projects ..................................................................... 7
2.
ICT ONLY Infrastructure Projects: Actual Vs Forecast ........................... 8
3.
All Projects: Actual Vs Forecast .............................................................. 8
4.
ICT Infrastructure Projects: Actual Vs Forecast (End User) ................... 9
5.
ICT Infrastructure Projects: Actual Vs Forecast (Design & Construct) ... 9
6.
ICT Infrastructure Projects: Actual Vs Forecast (Buy & Sell)................ 10
Project Schedules ................................................................................................ 10
1.
Current Status of Project Plans ............................................................ 11
2.
Current Status of Project Plans (U) ...................................................... 11
3.
Current Status of Project Plans (D&C) ................................................. 12
4.
Current Status of Project Plans (B&S) .................................................. 12
5.
Current Status of Project Plans (ANZ) .................................................. 13
6.
Current Status of Project Plans (SEA) .................................................. 14
7.
Current Status of Project Plans (Enterprise) ........................................ 15
8.
Current Status of Project Plans (Telecom) ........................................... 15
9.
Current Status of Project Plans (Industrial) ......................................... 16
Economic Outlook: Impact ................................................................................... 16
1.
Outlook Index....................................................................................... 16
2.
Economic Outlook: Impact by Geography ........................................... 17
3.
Economic Outlook: Impact by Role ...................................................... 18
Business Performance ......................................................................................... 19
1.
Business Performance Index ................................................................ 19
2.
Business Performance by Geography .................................................. 19
3.
Business Performance by Role ............................................................. 20
4.
Business Performance by Industry ...................................................... 22
CAPEX ................................................................................................................. 24
1.
CAPEX Index ......................................................................................... 24
2.
CAPEX by Geography ........................................................................... 24
3.
CAPEX by Role ...................................................................................... 25
4.
CAPEX by Industry ................................................................................ 28
DCIM ................................................................................................................... 30
DCIM Informed Decisions .................................................................... 30
IT&C Concerns ..................................................................................................... 31
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Introduction
This is the 12th edition of the Asia Market Pulse. The survey continues to follow the established
format including deployment in six languages; English, Japanese, Indonesian Bahasa, Thai, Korean
and Vietnamese. Offering access to these markets in a local language version has increased the
penetration of the survey into all Asia markets and helps continue to increase the response rate, as
well as its relevance to the markets and respondents served. Public release versions of this report
are translated and shared with all participants.
Executive Summary
The primary purpose of this research is to establish a statistically based forward view that offers an
insight into the direction of the critical infrastructure market in Asia. As per the Oct 2013 survey, a
start was made to find meaningful correlations between leading and lagging indices as a further tool
to make sense of sometimes contrary dimensions offered by the study respondents. The index that
had the closest correlation with CAPEX spending was Business Sentiment.
The correlation in October 2013 was 0.84 after the lagging and leading nature of each dimension
was taken into account and offset accordingly. At the time, the proposition was put that CAPEX
would rise in the period ahead. The March 2014 edition has recorded a rise (+45%) in the Capex
index (past 6 months) and looking ahead indicates that this may continue with Business Sentiment
continuing to rise (+38%). While the strength of the correlation has tapered off slightly (0.79), the
performance of this dimension will be closely followed over the next surveys.
This edition of the Market Pulse is the fourth consecutive survey with a positive growth in the overall
index. The sample size is the 4th largest collected over the 12 surveys and is a solid representation of
the region.
Market Pulse Index: 5 component indices






Market Pulse Capex: Basic tracking determines if respondents are proceeding with CAPEX or see a risk not to
proceed. This index is a simple division of # that are proceeding, by those deemed to be at risk. As such, the higher
the number, the better.
Market Pulse Project Forecast: Respondents are asked to note project deployment schedules past and
present. This enables a simple comparison by period of how forecast and actual deployments match up. Project
numbers are normalized so as to take into account sample size and the index is determined by subtracting forecast
from actual. A positive number indicates Actual deployments exceeding the forecast for the same period.
Market Pulse Project Schedule: Respondents are asked to note the expected schedule for project
deployment. This index assumes that a shorter timeline offers less risk for cancellation or delay and categorizes
responses into firm deployment and "at risk" segments. This index is a simple division of # that are "firm" by those
deemed to be at risk. As such, the higher the number, the better.
Market Pulse Economic Sentiment: Respondents are asked to rate how the local economy is impacting on
their business prospects. Once neutral responses are removed a simple positive vs negative dataset provides the
basis for this index. Less than "1" indicates a generally negative sentiment, more than "1" indicates a positive
sentiment. As such, the higher the number, the better.
Market Pulse Business Sentiment: Respondents are asked to rate their business prospects going forward.
Once neutral responses are removed a simple positive vs negative dataset provides the basis for this index. Less than
"1" indicates a generally negative sentiment, more than "1" indicates a positive sentiment. As such, the higher the
number, the better.
Market Pulse Index: Summary Index
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Summary Chart of previous Market Pulse Surveys & Current Trend;
Market Pulse Index
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Demographics
1. By Geography
2. By Role
Respondents are grouped according to their relationship with Emerson. The three categories are
respondents as;
1. Users (U) of Emerson services or equipment,
2. Designers and influencers associated with specification and recommendation of Emerson
services or products who Design & Construct (D&C) projects, and
3. Those who Buy and Sell (B&S) Emerson services or products.
Demographic by Respondent role in the Emerson supply chain has remained relatively steady over
the seven years the Market Pulse survey has run, notably in this 12th edition the Buy & Sell grouping
has maintained the trend of taking a larger share.
3. Market Segments
Respondents are drawn from all parts of the market: 1) BFSI - Banks, Financial Services, Insurance 2)
Communication - Broadcast, Publishing, Advertising & research 3) Education - educational institutions
4)
Government 5) Healthcare - Pharma, Hospitals, Medical services, Medical equipment 6) Hosting
Facility 7) Industrial - Manufacturing and construction 8) Infra Services - Professional consultancies,
Installers 9) IT - IT Hardware and software products 10) IT Services - Network services, Outsourcing,
BPO 11) Media & Entertainment 12) Resources - Oil, Gas, mining, Utilities 13) Telecom - Telecom
Operators & Technology Providers 14) Others.
The top segments participating in this survey (apart from D&C, B&S companies) are: Telecom, BFSI,
Government, Manufacturing, Education, Energy & Utilities.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
4. By Scale
The 2009 H2 survey saw the introduction of several new questions, Scale of the primary deployment
being one of them. At the time it was noted that a significant portion of respondents were defined in
the small room or network category (ie less than 30 racks).
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Projects
Respondents were asked to list projects that have been deployed in the past 6 months and those
scheduled for deployment in the next period. It offers insight project pipeline trends as well as the
correlation between forecast and actual deployments.
1. ICT Infrastructure Projects
Since the second half of 2010, the split in funding between core IT and support infrastructure has
remained fairly constant albeit below the historical average. As the survey enters an 8th year of
deployment, rather than track results by edition (above), I’ll start to aggregate surveys into annual
periods (below)
Please Note: in the following Project related charts, to overcome any bias caused by variations in
sample size, this data has been normalized.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
2. ICT ONLY Infrastructure Projects: Actual Vs Forecast
Respondents were asked to list projects that have been deployed in the past 6 months and those
scheduled for deployment in the next period.
Actual deployments have eased with a flat forecast for the 6 month period ahead.
3. All Projects: Actual Vs Forecast
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
4. ICT Infrastructure Projects: Actual Vs Forecast (End User)
In spite of the past 4 surveys recording a declining forecast, over the same period, actual
deployments have risen albeit in a modest fashion.
5. ICT Infrastructure Projects: Actual Vs Forecast (Design & Construct)
By virtue of their position in the market, the D&C segment has visibility into projects across multiple
clients and multiple segments and as such offers a leading insight into market conditions. In contrast
to the end user story line, D&C extends the improvement streak to a 6th survey in both ACT & FOR.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
6. ICT Infrastructure Projects: Actual Vs Forecast (Buy & Sell)
As the sample of respondents that are drawn from the Buy & Sell segment has steadily increased,
the project data pertaining to that market has settled into a more reliable and valid insight. The last
5 surveys provide a useful view of the robust outlook into what effectively is a proxy for the infra
mid market. Approximately 75% of recipients in this category primarily service infra opportunities of
less than 30 racks (ie. the simplified def. for SME infra application).
Project Schedules
In past Market Pulse reports, schedule plans were communicated based on respondents specific
feedback as per the table below. While this describes the specific data, in this format the overall
trend is more difficult to grasp. In light of this, I have taken a different and hopefully clearer
approach sharing this information.
To create the associated index, the basic data is further segmented into two categories. They are 1)
an "active" category which is comprised of projects that have been accelerated or the deployment
schedule is unchanged or 2) "at risk", ie there is an expectation of delay.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Plotted as a chart, trends associated with Active and At Risk project schedules are more clearly
identified along with the trend of the index. In this case, schedules have been steadily improving in
the past 3 surveys. Left hand axis is the actual % spread of 'active" and "at risk", with the index
plotted down the left hand axis. Respondents were asked to define the likely timing of projects listed
in their pipeline.
1. Current Status of Project Plans
2. Current Status of Project Plans (U)
Improvements noted over the past 3 years have now retreated with the overall and End User Index
falling below the historical average. If previous observations per the choppy nature of the project
schedule hold true, this decline in the Schedule index should prove to be brief. (Previous NB on this:
evidence of the End User segment project cycle compressing dramatically over the past decade as
waves of new technology impact their core business position.)
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
3. Current Status of Project Plans (D&C)
As per previous interpretations of this indicator, a decline in Active and an increase in (at) Risk
schedules would suggest this segment is consuming capacity previously built into their project
funnel.
4. Current Status of Project Plans (B&S)
The Buy and Sell segment continues to align with the general trend.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
5. Current Status of Project Plans (ANZ)
Total Market
Design & Construct
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
6. Current Status of Project Plans (SEA)
Total Market
Design & Construct
Even though the SEA indices remain steady relative to Australia, contrary to the usual divergence
between the regions, on this occasion all four indices have returned a similar (downward) result.
That said, SEA End User Index remains above (5%) the historical average.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
7. Current Status of Project Plans (Enterprise)
Enterprise as a segment is comprised of the following market segments; IT Services (Buy and Sell),
BFSI, Government, Datacom, Infra Services (Design & Construct), Education, Healthcare, Broadcast &
Communications, Other. The decline reflected here is tempered by the fact that the Index remains
just above (1%) the historical average.
8. Current Status of Project Plans (Telecom)
The decline reflected here is tempered by the fact that the Index is on par with the historical
average.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
9. Current Status of Project Plans (Industrial)
Industrial as a segment is comprised of the following market segments; Manufacturing, Energy &
Utilities, Transportation, Other.
Economic Outlook: Impact
Respondents were asked to rate the impact of Asia's economic conditions on the business prospects
of their company in the near future. This is a five point scale comprised of the following
descriptions; Very Helpful, Helpful, Neutral, Harmful, Very Harmful. The following charts select the
top 2 and bottom 2 scores (eliminating neutral) and assigns "active" and "at risk" categorizations
respectively.
1. Outlook Index
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
2. Economic Outlook: Impact by Geography
Australia & New Zealand
South East Asia
Over the past 10 surveys, the "active" sentiment for Asia as a whole has remained fairly stable
(exception of H1 2009) with movement within a modest 10% window of variation. The overall index
remains quite positive (high) with a solid (broad) spread between "active" and "at risk".
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
3. Economic Outlook: Impact by Role
End Users
Design & Construct
Buy & Sell
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Business Performance
Respondents were asked to indicate how over the next 6 months, they expect their company's
overall performance will change. This is a five point scale comprised of the following descriptions; It
will improve very much, It will improve, It will remain the same, It will worsen, It will worsen very
much. The following charts select the top 2 and bottom 2 scores (eliminating neutral) and assigns
"active" and "at risk" categorizations respectively.
1. Business Performance Index
2. Business Performance by Geography
Australia & New Zealand
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
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South East Asia
3. Business Performance by Role
End Users
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
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Design & Construct
Buy & Sell
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
4. Business Performance by Industry
Enterprise
Telecom
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
Industrial
Each of the above segments of the data (with the exception of Industrial) has returned a positive
result. In October 2013 the correlation between this dimension and CAPEX was noted;
Of the five indices that form the overall market Pulse index, four are leading and one is lagging. With over five years of data
collected, the survey authors are now well placed to test the correlation between the leading and lagging data sets in an
effort to test the strength of the forward view. This goes to the central purpose of the overall study effort.
Using published definitions of strength, the correlation found to exist between “Business Sentiment” and “Capex” indices is
categorized in the highest rating band, namely a “very strong positive relationship”.
Business sentiment has risen significantly since the last survey [published in March 2013], while in the past six months, CAPEX
activity has declined. If the historical correlation between these two factors is any indication, then I’m cautiously optimistic
going into the New Year per an improvement in capital spending
The improvement in the CAPEX index in this current edition of the Market Pulse would appear to
support this proposition. Considering the continued improvement in this Business Performance
index, CAPEX may be set to post further gains in the second survey of 2014.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
CAPEX
Respondents were asked to indicate how over the past 6 months they have managed CAPEX activity.
This is a six point scale comprised of the following descriptions; Accelerate Projects, No Change,
Delay by 3 months, Delay by 6 months, Delay by 9 months or more, Downsize. The following charts
note respondents who selected "Accelerate Projects or No Change" as "active" and delay or
downsize responses as "at risk".
1. CAPEX Index
2. CAPEX by Geography
Australia & New Zealand
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
South East Asia
3. CAPEX by Role
End User (Asia)
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Bi Annual poll IT&C Infrastructure Professionals
March 2014
CAPEX by Role continued
End User (ANZ)
End User (SEA)
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Bi Annual poll IT&C Infrastructure Professionals
March 2014
CAPEX by Role continued
Design & Construct (Asia)
Design & Construct (ANZ)
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
CAPEX by Role continued
Design & Construct (SEA)
4. CAPEX by Industry
Enterprise
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
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CAPEX by Industry continued
Telecom
Industrial
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
DCIM
Three new questions were presented to respondents in the 9th edition that relate to DCIM. A
preamble was provided to frame the subsequent question set as follows; DCIM (Data Centre
Infrastructure Management) is a relatively new focus in our market. It offers business the
opportunity to truly optimize infrastructure through the structural linking and alignment of the
dynamic application core and the essential support infrastructure. This leads to improved OPEX,
reduced energy consumption, improved Uptime and greater utilization of critical infra. Q1) Has your
business deployed (or been involved in the deployment of) DCIM solutions in the past 6 months?
Q2) Do you intend to pursue (directly or on behalf of clients) DCIM opportunities in the next 6
months? Q3) Is there sufficient information from vendors and partners on this topic to enable
informed decisions?
-
DCIM Informed Decisions
H2 2012
H1 2013
H2 2013
H1 2014
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
IT&C Concerns
As per previous surveys, respondents were asked to indicate their top three worries / concerns /
challenges.
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IT&C Market Pulse
Bi Annual poll IT&C Infrastructure Professionals
March 2014
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