Australia’s ICT sector continues to perform well while the IT market in particular is expected to have considerable medium-term growth potential.
Market performance at a glance
- The Australian IT market is forecast to have considerable medium- term growth potential, particularly in areas such as tablets, real-time enterprise software and data centre growth.
- IT services sales grew by more than 8% in 2014, and will continue to be the highest performing segment, with cloud services the key growth driver as local companies try to use efficiencies enabled by high speed internet.
- The Australian Government is an important factor, driving the IT market through its purchase programme and various initiatives, such as boosting domestic software development.
- Growth opportunities in the telecommunications subsector will be severely limited in the years ahead due to the highly saturated nature of the market. However, in the mobile segment there is still growth potential given the increasing popularity of mobile data services.
- Our underwriting stance remains generally open for wholesalers/ distributors and retailers, system integrators and IT software/services/hardware companies. With minor exceptions, ICT businesses continue to show yearly growth rates. The financial performance should remain stable with banks willing to lend to ICT companies. Protracted defaults and insolvency levels are low in this industry.