Japanís Major IT Markets: Scale and Trends through 2014 (1)
- Optical Fiber Line Subscriber Base to Increase 1.4 Times to 24 Million in 5 Years -
December 16, 2009
Nomura Research Institute, Ltd.
Nomura Research Institute, Ltd. (NRI: Tokyo; Akihisa Fujinuma, Chairman and President, CEO & COO) has completed market analyses and market scale forecasts for the period through fiscal 2014 for five major markets of information technology in Japan. In this first phase, NRI announces forecasts for the four fields of the broadband service market and the four fields of the broadcasting media market. NRI plans to publish forecasts for the Internet-based business, mobile and hardware markets on December 21, 2009.
Market Scale Forecasts
(See the definitions for each market provided at the end of this news release.)
(Unit: Billion yen)
*1: CAGR (Compounded Annual Growth Rate) refers to the average annual growth rate of each field during the five years between fiscal 2009 and fiscal 2014.
While optical fiber lines will continue to drive the broadband line market, the market will gradually reach saturation
Backed by a steady increase in the number of optical fiber line subscribers, the broadband line market will continue to grow. By the end of fiscal 2014, the number of subscribers to all types of broadband lines will reach about 35.50 million with the scale amounting to about 1,560 billion yen (of which about 24 million subscribers and about 1,020 billion yen will be for optical fiber lines). While the growth rate of the entire market is in a gradually declining trend, the optical fiber line subscriber base is expected to increase about 1.4 times over that in fiscal 2009 (Figures 1 and 2).
A shift from conventional leased lines to new, lower-priced WANs (IP-VPN, wide area Ethernet, Internet VPN, etc.) is expected to accelerate. The factors behind such acceleration include that companies will further reduce their investments in the development of information systems because of the economic recession caused by the global financial crisis. As a result, the market size is projected to shrink from about 910 billion yen in fiscal 2009 to 810 billion yen in fiscal 2014.
This market has entered a new, high demand phase because of a significant increase in data traffic in recent years and companies' greater interest in business continuity and compliance. Because the supply of server housing space is generally inadequate in cities in Japan, it is a pressing need for many companies to acquire such space. In light of such a high demand for data centers, a rush has been continuing among data center service providers to construct and build data centers, which will expand the market size from about 1,250 billion yen in fiscal 2009 to 1,530 billion yen in fiscal 2014.
SaaS (software as a service)
With the diffusion of services first developed by American vendors and the spread of services among specific industries, the market size in fiscal 2009 is projected to reach about 24 billion yen. As users increasingly recognize the cost effectiveness brought about by the use of SaaS and the number of software products meeting the requirements of user companies increases, the market will steadily grow and amount to 47.7 billion yen in fiscal 2014, which is about double its current size.
Figure 1: Forecasts for the Subscriber Base by Type of Broadband Line
Figure 2: Forecasts for the Market Scale by Type of Broadband Line
Terrestrial digital broadcasting will be viewed by about 47.10 million households in five years
Number of households viewing terrestrial television broadcasting
With the cessation of all analog transmissions in July 2011, the number of households viewing terrestrial television broadcasting will temporarily decrease from about 49 million as of December 2009 by about 4 million. As the number of households equipped with digital television receivers increases after the cessation of analog broadcasting, the number of households viewing terrestrial digital broadcasting is expected to reach about 47.10 million by the end of fiscal 2014. If the market is looked at by reception format, reception through cable TV is projected to expand and about 33.10 million households will view television broadcasting through cable TV by the end of fiscal 2014.
BS digital broadcasting
By the end of fiscal 2014, the number of households that are capable of viewing BS digital broadcasting will reach about 32.80 million (slightly more than 1.3 times that of fiscal 2009). Such expansion of the number of households capable of viewing BS digital broadcasting will be brought about through the diffusion of a common receiver for all three wave formats (a receiver capable of receiving terrestrial digital television broadcasting, BS digital broadcasting and 110° east longitude CS digital broadcasting). In addition to the development of the reception environment such as the availability of a common receiver, major factors contributing to the expansion of the number of viewing households include the expanded use of BS digital broadcasting, mostly among seniors.
Multichannel broadcasting (cable TV, satellite digital broadcasting, etc.)
The size of the multichannel broadcasting market is projected to expand from about 600 billion yen in fiscal 2009 to about 700 billion yen in fiscal 2014. Specifically, cable TV will amount to about 470 billion yen, with about 160 billion yen for satellite digital broadcasting and about 60 billion yen for IP broadcasting. Major factors for such market expansion include the expected expansion of users of 110° east longitude CS digital broadcasting as accelerated by the spread of a common receiver for all three wave formats and an increase in the number of cable TV and IP broadcasting users through a complete shift to terrestrial digital broadcasting.
VOD (video on demand)
The VOD market is projected to expand approximately 1.5 times from about 48 billion yen in fiscal 2009 to about 73 billion yen in fiscal 2014. The major reasons behind such forecasted expansion include enhanced VOD services for TVs and the diffusion of TVs with VOD functions and cable TVs.
This is the ninth edition of NRIís IT market forecasts since 2000. NRI plans to publish the details of market analyses and forecasts in a book entitled Korekara joho tsushin shijo de nani ga okorunoka Ė IT shijo nabigeta 2010 (What will occur in the information and communications market in the future Ė IT market navigator 2010) on December 22, 2009, by Toyo Keizai Inc.
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Nomura Research Institute, Ltd.
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