Article

TMT Predictions 2016

Namibian Edition

Introduction

We are pleased to publish the 2016 Technology, Media and Telecommunications (TMT) predictions. Deloitte predicts exciting trends for the next year. Our Global TMT Predictions for 2014 hit the mark with 13 of the 14 overall predictions. We are therefore at the forefront of helping you understand and prepare for the opportunities these changes bring with them. We have briefly summarised below what Namibians can expect from the TMT sector in 2016

The 2016 Global TMT Predictions article can be found here

Technology

While there are some concerning trends, overall the technology landscape is in for some exciting changes, affecting a wide range of industries from banking to manufacturing.

We find the ratio of women employed in IT to be a focal point across the world: Deloitte Global predicts a decline to fewer than 25% of women in IT positions, largely as result of the declining education pipeline of female undergraduates pursuing IT degrees. The Namibia University of Science and Technology is well aware of this challenge, as is evident from their recent Namibia Women in Computing Conference held on the 27th February 2016, which aims to attract women to the IT sector.

Some good news is to be had on the front of PC sales – Deloitte Global predicts that laptops won’t go out of vogue just yet: 18-24 years olds newly entering into the market see laptops and smartphones as complementary, not mutually exclusive. Touch commerce – the easy, fast checkout of online payments via fingerprint or two-touch verification, may seem a distant reality for all but the most developed nations, but with the steady advent of internet banking, this may soon become reality in Namibia too. Mass produced Graphene, on the other hand, seems out of reach until research can develop commercially viable processing of graphite into the highly sought after material. With desirable tensile, thermal, electrical and optical properties, the material is predicted to lead to revolutions in battery life, solar panels, vehicle manufacture and a myriad of other applications, but currently weighs in at USD100 per gram. Cognitive technologies are set to be the next Holy Grail of computing – with machine learning, natural language processing, speech recognition, improved core functionality, new insight generation and automation, these technologies are expected to lead to significant operational savings and major analytical insights for the enterprises willing to invest.

Media

The Media predictions may sound like something straight out of Star Trek, with the advent of Virtual Reality set to take over the gaming industry, 2016 being the first billion dollar year for the industry. As the market matures, Deloitte Global predicts that this technology will have a wider application in education, communication and the military. The mobile games industry is set to boom, becoming the leading platform by software revenue – but beware that the return per published game is still far lower than for competing platforms. In related news, ad blockers for mobile devices are not expected to impact advertising revenue, as only 0.3% of users are expected to make use of such, as ad-blockers are limited to browsers and so do not dispense of the ads on applications, where the majority of advertisements are placed. There is good news, too, for cinema box office revenues, which, in the face of digital media are still not expected to decline significantly, depending, of course, on the slate of movies released. The same cannot be said for the television industry, with services such as Netflix – newly available in South Africa and Namibia -heavily encroaching on the traditional Pay-TV market, for example DSTV, Deukom and its newest competitor Satelio, but Deloitte Global expects that while the television industry will not see growth, it will also not see declines. The Southern African market has reacted to this threat by offering Box Office movie rentals that work on a pay per view basis and are accessible via the regular decoders.

The bleak situation for traditional media is somewhat helped by the prediction that global football revenue will grow to USD 30 billion in the 2016/2017 season. A new phenomenon in the media industry, eSports is set to generate USD 500 million. ESports, where people watch other people play competitive video games for big money prizes, while accounting for only a fraction of the size of major sports, such as soccer, football or basketball, are expected to grow by 25%.
 

Telecommunications

Deloitte Global predicts that the number of Gigabit per second Internet connections will surge to 10 million by the end of 2016, of which about 70% will be residential. By 2020, we expect that the majority of worldwide internet users will be on networks that offer a Gigabit tariff, though this will likely be too soon for Namibia. As internet-enabled devices become more available and affordable in Namibia, we expect that Namibia will follow closely on the heels of developed markets. Deloitte Global expects a marked increase in the trade of used smartphones, from USD 11 billion to USD 17 billion, affecting the retail and services sectors.

Data usage is set to increase, as in 2016, 26% of smartphone users in developed markets will not make any traditional phone calls in a given week, substituting traditional voice calls for a combination of messaging and voice or video services over IP. In contrast, about 100 carriers worldwide are expected to offer at least one packet-based voice service by the end of 2016. Deloitte Global further estimates that approximately 300 million customers will be using Voice over LTE or Voice over WiFi services. Telecommunication companies in South Africa call to regulate such providers, for example WhatsApp, Facebook and Viber, the impact of which is likely to spill over into Namibia, although it is still unclear what form, if any, such regulation could take. Namibian data service providers will welcome an increased data usage in 2016, with 2.5 trillion photos globally that will be shared or stored online, a 15% increase on 2015, of which over 90% will be taken using a smartphone. The expected network impact of this will be about 3.5 exabytes (about 3.9 million gigabytes), an increase of 20% over the prior year.


In conclusion, we predict that developments in Technology, Media and Telecommunications will continue to cause disruptions to traditional business models and provide opportunities to reinvent service delivery in Namibia.  

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