Fujitsu 2008 Annual Report Download - page 26

EMEA
n Market Trends
The EMEA IT services market is projected to grow by roughly 6% in 2008. In contrast to
Western Europe, where competition is heating up as the market matures, high growth
rates are expected for Eastern Europe, Russia, the Middle East and other newly emerging
markets. In the UK, a widely anticipated decline in business deals for large projects will
likely follow major cuts in the government’s IT budget in response to changes in the
country’s political and economic climate. In a prominent trend among IT firms, U.S.-
based companies have gained greater cost advantages, and expanded their customer
bases, by actively exploiting offshore resources. Among local firms, there is a pronounced
move to expand the business scope beyond their own borders through M&As.
In the communications market, governmental deregulation is among the factors
fueling more vigorous competition, leading telecommunications carriers to invest
robustly in broadband and 3G technologies. Announcements of Next-Generation Net-
work projects by British Telecom were closely followed by similar announcements from
France Telecom and Deutsche Telekom, as progress on the construction of optical fiber-
based access networks gains ground. For WiMAX, companies are trial testing the tech-
nology and cementing business alliances in the region ahead of the start of bidding for
frequency licenses. The Middle East, Africa and other newly emerging markets, mean-
while, have hosted a series of communications license auctions as the opening of the
markets for both fixed and mobile networks leads to more growth opportunities for
foreign telecommunications carriers.
n Initiatives Going Forward
In the IT services field, Fujitsu Services in the UK is spearheading efforts to improve our
price competitiveness and earnings power, and expand business opportunities, through
aggressive use of offshore and nearshore resources. M&As and alliances will be used,
moreover, to enlarge our business area and enhance our capacity to develop global busi-
ness deals. For the outsourcing business, we are striving to set Fujitsu apart from other
companies by continually improving services through a collaborative approach with
customers, industrializing services based on the TRIOLE approach, and by taking proac-
tive steps to promote eco-friendly “green” IT services. We will reinforce proposal capabili-
ties particularly for the financial services and retail sectors, while striving to further
enhance service quality. Taken together, these actions should accelerate demand from
private-sector customers.
As for system platforms, reinforcing our partnership with Siemens AG of Germany will
allow us to leverage a comprehensive portfolio of products and services to create added
value. Promoting greater utilization of Fujitsu Siemens Computers’ system products,
moreover, will enable Fujitsu Services to avoid simple cost competition in the services
that it offers, while retaining sales volume.
In the communications field, where we operate mainly through UK subsidiary
Fujitsu Telecommunications Europe, we intend to focus on the access-related elements
of British Telecom’s 21st Century Network project. At the same time, we will set Fujitsu
apart from competitors by strengthening ties with other EMEA bases and developing
new business models.
(Years ended March 31)
NET SALES* AND OPERATING
INCOME MARGIN
(Billions of Yen) (%)
Net sales (left scale)
Operating income margin (right scale)
* Including intersegment sales
2004 2005 2006 2007 2008
0
200
400
600
800
0
4
2
6
8
563.3 596.9 632.5
736.3 769.9
1.2
2.0
3.6 3.3
0.1
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ANNUAL REPORT 2008FUJITSU LIMITED
FEATURE 2: ACCELERATING GLOBAL EXPANSION