Fujitsu 2014 Annual Report Download - page 58

INITIATIVES BY REGION
Japan
FUJITSU DATA
MARKET DATA
Graph 01 Graph 02 Graph 03
NET SALES* AND OPERATING INCOME
MARGIN
0
1,000
2,000
4,000
3,000
3,389.2 3,465.1
3,400.5
10
8
6
4
2
0
4.9 5.9
5.4
3,396.2 3,306.4
6.4
5.2
2010 2012 2013 20142011
(Billions of yen) (%)
(Years ended March 31)
(Source: Gartner, “Market Share: IT Services, 2013” 31
March 2014)
* Chart created by Fujitsu based on Gartner data * Including intersegment sales
Net sales (left scale)
Operating income margin (right scale)
1Fujitsu 12.8%
2Company A 8.7%
3Company B 8.5%
4Company C 8.4%
5Company D 6.4%
6Others 55.2%
SHARE OF 2013 IT SERVICES MARKET
SALES IN JAPAN (REVENUE BASIS)
1
6
2
3
4
50
60
40
51.3 53.5 54.2
52.9
2013 2015 2016 20172014
52.1
20
IT MARKET FORECASTS (JAPAN)
(Billions of U.S. dollars)
(Source: IDC, May 2014 “Worldwide Black Book Query Tool,
Version 1, 2014”)
MARKET TRENDS
The Japanese IT market is expected to contract by 1.0% year on
year in 2014.
In 2013, the IT market grew by 3.4% from the previous year. In
addition to economic recovery owing to the effects of the govern-
ment’s economic policies and the yen’s depreciation, growth
came atop PC replacement demand triggered by the end of
support for Windows XP, and a surge in demand ahead of an
increase in Japan’s consumption tax. In contrast, the IT market is
set to decline slightly in 2014, reflecting the absence of growth
drivers from the previous year.
While causes for concern persist, among them temporary
weakness in consumer spending as a result of the consumption
tax increase, and rising prices for imported raw materials due to
a weaker yen, the ongoing recovery in ICT investment in the
manufacturing, distribution, and financial industries is expected
to remain as strong as in the previous year. In the public sector,
investment is growing to build out shared infrastructure, to
implement systemic reforms, and to enhance system conve-
nience. The healthcare sector, meanwhile, is seeing increased
links between different regional healthcare networks.
Amid these trends, Japan’s server market is expected to undergo
a year-on-year 10% contraction. This downturn will likely stem from
decreasing demand due to several factors, including demand for
large-scale upgrades in the mainframe market having mostly run
its course in the previous year, a shift in recent years from UNIX
servers towards x86 servers, and server integration. Although
growth is forecast to continue from the previous year in the x86
server market, looking at the overall server market there is a trend
toward contraction due to the impact of declining demand for large
servers, coupled with falling prices. Given such movements in the
market, Fujitsu anticipates that ICT expansion into new domains
will work to offset contraction in existing markets.
The PC market is expected to decline 13.9% year on year, with
a projected decrease due to the absence of replacement demand
associated with the end of support for Windows XP from the
previous year partially offset by growth in the tablet market.
The IT services market is estimated to grow by 1.6% from the
previous year, reflecting a modest recovery in IT-related invest-
ment atop ongoing recovery in corporate performance. Demand
for the replacement of legacy systems ahead of future growth is
rising, with expansion in systems integration and subsequent
systems management outsourcing also projected.
Cloud-based services are also steadily becoming more wide-
spread, and are partly responsible for market growth. Addition-
ally, as new IT-based services that utilize big data emerge, the
IT services market is widely expected to see modest but contin-
ued expansion.
INITIATIVES GOING FORWARD
Fujitsu will move this fiscal year from the structural reform phase
executed through the previous term to a quest for new growth,
including the pursuit of Human Centric Innovation. By merging
the three key elements of “People, Information and Infrastruc-
ture,” Fujitsu will enable customers to realize innovation. This can
be seen in Fujitsu’s powerful systems integration capabilities, as
demonstrated by Fujitsu systems engineers, together with the
creation of new value from information such as big data, the
securing of information reliability, and high-quality servers,
networks, datacenters, and upon this infrastructure, cloud-based
Explanations for underlined words can be found in the glossary on pages 160-162.
056 FUJITSU LIMITED ANNUAL REPORT 2014