February 17, 2009 By News Staff
A new report from ITU, launched at the Mobile World Congress in Barcelona, highlights some harsh realities for the global ICT industry. The report, Confronting the Crisis: Its Impact on the ICT Industry considers how the industry can position itself for recovery in the future.
Confronting the Crisis: Its Impact on the ICT Industry draws on analysis from leading industry experts and international institutions. As the established order is overturned, it says, convergence in the ICT industry will accelerate, with the emergence of new players with new business models. Firms' ability to weather the economic storm will depend on their ability to invest for the future and explore new opportunities to benefit from the eventual upturn. For an industry founded on innovation, the current turmoil will create openings for nascent ICT companies.
Confronting the Crisis finds that although credit is now less abundant and more expensive, with financing costs for operators on average 3-4 per cent higher year-on-year, savvy operators can take advantage of the economic turmoil to reposition their services for the upturn. Funding is still available for players with sound business models, established demand and early projected cash flows. Alternative sources of financing are now needed, with a growing role for government financing and economic stimulus packages.
"Despite difficult times, there are reasons to be optimistic," said ITU Secretary-General Hamadoun Touré, speaking in Barcelona. "Having contributed consistently as a high-growth sector in its own right, ICTs can now power economic recovery across all sectors. Along with stimulus packages put together by governments, the ICT industry must continue to invest in infrastructure and the roll out of cost-effective services, such as next-generation networks." Touré added that innovation is the key to recovery.
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