BMI's Executive Summary

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Market Overview

The total size of the Oman IT market is forecast by BMI to increase from US$276mn in 2007 to US$413mn in 2012. The government is investing in IT as a key element of its strategy to diversify the economy, and despite some risks, a favourable economic outlook is expected over the forecast period. The total IT spend is expected to grow at a CAGR of 8% over the forecast period from 2007 to 2012. Oman is one of the smaller IT markets in the region, and the emphasis on diversification is encouraging infrastructure projects in sectors ranging from tourism to ports.

With the US-Oman Free Trade Agreement (FTA) opening the gateway to more IT imports, nearly all sectors are feeling the benefits of recent high oil prices and improved performance of the nonhydrocarbon economy, The PC market performed well in 2007 due to strong demand for notebooks as well as important projects in sectors like government, oil and gas, and telecoms. Telecoms liberalisation and compliance with banking regulations are positive drivers of opportunities in these sectors.

Industry Developments

The continuing development of e-government in Oman received a boost towards the end of 2007 with the launch of the government' new national electronic web portal. The portal, developed by the country's IT Authority (ITA) was officially inaugurated in November 2007 and will allow citizens to pay taxes, fees and fines to government institutions. The new portal is part of the ‘Digital Society' government project launched by the ITA in June 2006.

In 2007 the ITA launched a new phase of the digital Oman project and during the next five years a number of new services will be rolled out to connect citizens and the government of Oman. Information Technology is expected to be one of the key sectors to benefit from the US-Oman FTA, that was signed by President Bush in November 2006. The ultimate vision of policy makers is to establish a full Middle East FTA by 2013. Moves towards trade liberalisation and the creation of a Gulf Co-operation Council (GCC) Free Trade Area are among the drivers of IT market growth in BMI's forecasts.

Company News

The continuing strong growth in PC sales in 2007 in Oman and across the region did not significantly alter a competitive landscape dominated by international players such as Acer, Hewlett Packard (HP) and Dell. The strongest challenge to these main players comes from other multinationals, with Toshiba making particular progress. The strong position of multinationals can partly be attributed to the high demand for notebooks, which remains the most dynamic type of computer. Another factor is the regional demand for enhanced functionality rather than simply low prices.

With growth expected to continue to increase steeply, vendors are positioning themselves to defend and expand market share. Part of the challenge for vendors in the region is to establish the right distribution strategy, and in particular achieve the right relationship with channel partners. Dell recently appointed Asbis, better known for its strength in whole components, as a dedicated distribution partner for Oman. Services are set to be the fastest growing area of the market over the next few years and this is prompting some consolidation. The most notable deal in 2007 came with HP's purchase of Atos Origin Middle East (AOME), formerly the largest systems integrator in the region. Meanwhile new Siemens IT Solutions and Services Company entered the Oman market in 2007 and will focus on industry-specific solutions particularly for government and airports.

Computer Sales

According to BMI estimates, the Oman PC market (including notebooks and accessories) was worth US$99mn in 2007, within an overall computer hardware market of around US$126mn. CAGR for hardware spending is expected to be at least 7% over the forecast period through 2012. General market drivers include the growing popularity of notebooks, the government's ‘Towards Digital Oman' strategy, and the elimination of custom duties within the GCC.

Software

BMI predicts a legal software market value of US$72mn in 2007, rising to US$112mn by 2012. CAGR for that period forecast is around 9%. With greater attention now being paid to intellectual property issues, and particularly following the signing of the FTA, the e-software (mainly import) market is expected to grow significantly. The evolution of the IT market means a stronger enterprise focus on software spending is being seen, with companies preparing to compete in a regional environment of greater trade freedoms.

Services

Oman's IT services market was estimated by BMI at US$77mn in 2007 and should rise to at least US$120mn by 2012. IT services revenues CAGR is forecast at 9% for the period through 2012. Currently support services still account for around one-third of spending, with consulting and integration the second-largest category, followed by managed services. Although the market remains relatively immature, tighter margins in the hardware segment are encouraging vendors and retailers to seek profits through value addition and greater emphasis on customer services.

Contents

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Chapter 1 - Executive Summary

Market Overview

Industry Developments

Company News

E-Readiness

Computer Sales

Software

Services

Chapter 2 - SWOT Analysis

Oman IT Industry SWOT

Oman Business Environment SWOT

Chapter 3 - Middle East Regional IT Markets Overview

IT Penetration

Market Growth & Drivers

Sectors & Verticals

Chapter 4 - Market Overview

‘Towards Digital Oman’

E-government:

E-governance:

History and Market Structure

Hardware

Software

Services

Industry Developments

Chapter 5 - Industry Forecast Scenario

Table: Oman Industry Historical Data and Forecasts

Chapter 6 - Economic Forecast

Table: Oman: Macroeconomic Data And Forecasts

Chapter 7 - Country Snapshot: Oman Demographic Data

Section 1: Population:

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education & Healthcare

Table: Education

Table: Healthcare: Vital Statistics

Table: Healthcare: Expenditure

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption and Stratification

Chapter 8 - Competitive Landscape

Company Monitor

Profiles

IBM

HP

Oman Business Machines/Gulf Business Machines (GBM)

Oracle

Microsoft

Chapter 9 - BMI Forecast Modelling

How We Generate Our Industry Forecasts

IT Industry

Sources

Chapter 10 - Appendix: Regional Demographic Data

The Long View: Data Over The Economic Cycle (2000-2007)

Population

Household Spending Per Capita, US$

Private Consumption Per Capita, US$ PPP

Market Size, GDP, US$bn

Competitive Landscape for Middle East & Africa Information Technology: Sample of  
Companies Ranked

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Company profiles, including SWOT (strengths, weaknesses, opportunities and threats) analyses, business activity, leading products and services. BMI forecasts for all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt. Company profiles and SWOT analyses covering competitive positioning; leading products, services and brands; annual sales and share of domestic hardware, software and components markets; headline financials and M&A; pan-regional expansion strategies and strategic partners. Companies covered include:

Network of Information Technology Sources

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BMI's Middle Eastern and African IT Reports are based on an extensive network of multilateral organisations, government departments, IT industry associations, chambers of commerce and company reports. Information sources include: