Deloitte’s Technology, Media and Telecommunications (TMT) report includes 10 predictions focused on critical business challenges and opportunities from 2017
The report predicts that Cyber attacks entering the Tera bit era, growth of biometric fingerprint sensor devices to one billion, the growth of IT-as-a-Service and enhancements in machine learning engineering for use in automobile and even medical industries as among top future trends
Knowing TMT trends is a key differentiator for businesses to retain competitiveness in a globally digitised world
Deloitte’s much anticipated 16th annual Technology, Media and Telecommunications (TMT) 2017 report has been released globally, intriguing those across industries with predictions on key technology and media developments. This year’s report, an annual publication, includes 10 predictions focused on critical business opportunities and challenges.
These include: Cyber attacks entering the Tera bit era, biometric fingerprint reader-equipped devices top one billion, the growth of IT-as-a-Service, and enhancements in machine learning engineering for use in automobile and even medical industries. 2017 predictions combine Deloitte forecasts, original and secondary research, perspectives gained from hundreds of conversations with industry leaders, and the aggregated opinions of tens of thousands of consumers across the globe.
“Connectivity is a core enabler of the modern economy; enhanced connectivity is likely to nurture and disrupt a significant part of global economic output for decades to come. Enterprises should start experimenting with new products and services based on higher speeds, greater capacity and a lower cost per gigabyte.Greater internet speeds may encourage greater device usage and impact consumer behaviour and global markets in turn,” said Max Marinelli, Country Managing Partner. Some of the key predictions included in the TMT report include the following:
Biometric security reaches the billions
The active base of biometric fingerprint reader-equipped devices will top 1 billion for the first time in early 2017. It is predicted that about 40 percent of all smartphones in developed countries will incorporate a fingerprint reader as of end-2017. By the end of the decade, the technology will become as available as front-facing cameras on even lower range smartphones. It is reported that consumers mostly use the technology for unlocking their devices.
Application developers are expected to meet growing demand through enabling other features including replacing password entry. Deloitte Global expects, as of end-2017, that the percentage of smartphone or tablet owners using facial, voice or iris recognition for authentication will be less than five percent compared to 40% for fingerprint readers.
Cyberattacks enter the Terabit Era
In 2017, Distributed Denial-of-Service (DDoS) attacks, a form of cyberattack, will become larger in scale, harder to mitigate, and more frequent. There are expected to be on average a terabit/s (Tbit/s) scale attack per month, over 10 million attacks in total, and an average attack size of between 1.25 and 1.5 gigabits per second (Gbit/s).
This escalation in the DDoS threat is largely due to the growing number of IoT devices, online availability of malware methodologies which allow relatively unskilled attackers to corral insecure IoT devices and use them to launch attacks, and access to ever higher bandwidth speeds.
Machine learning coming to mobile technology
Over 300 million smartphones, or more than a fifth of units sold in 2017, will have on-board neural network machine learning capability, i.e. computer models designed to mimic aspects of the human brain’s structure and function, with elements representing neurons and their interconnections. This capability will allow smartphones to perform machine learning tasks even when not connected to a network.
In the near term, most of the on-board machine learning capacity will be on consumer devices such as smartphones and tablets. Over time, the applications for the Internet of Things (IoT) devices may be more transformative, extending to possibilities to automated automobiles and more efficient medicinal dispensing machinery.
Users find tablet devices growingly obsolete
2017 sales of tablet computers (‘tablets’) fall by about 10% from 182 million units sold worldwide in 2016, indicating the device has passed its peak demand. Since their arrival, smartphones have taken the upper hand in the market, by becoming bigger and laptops becoming lighter.
Deloitte research in 15 developed markets reported that access to tablets of any size was 55%, while smartphones stood at 80%, and any computer (desktop or laptop) was 94%. 28 percent of respondents claimed they were likely to buy a new smartphone in the next 12 months, and 25 percent intended to buy a new computer (desktop or laptop).
IT-as-a-Service to become 35 percent of IT spend
By the end of 2018, spending on IT-as-a-Service, for data centres, software and services will be just under $550 billion worldwide. This would represent a rise of more than half from a forecast in 2016. The global trend transforms how the IT industry markets, sells and buys technology across businesses worldwide. The IT service industry is a viable and growing market, that offers sustainable opportunities for new business entrants to meet growing information technology demand. Assuming that rate of growth continues, Deloitte Global estimates that the market will be over $1,550 billion by 2018.
“In the developing world especially, there is an increasing demand for enteprises to use digital technology to provide telecommunications, financial and even medical assistance to people outside of urban areas. It is therefore evident that global trends point to an evolved consumer landscape of the 21st century, which has made driving access to faster and more affordable technology, especially via the smartphone, now a growing necessity rather than a luxury for the few,” concluded Marinelli.
Now in its 16th year, Deloitte Africa’s annual TMT Predictions provides an outlook on key trends over the course of the next 1-5 years in the technology, media and telecommunications industry sectors worldwide.
Marcian Concepts have been contracted by Selibe Phikwe Economic Unit (SPEDU) in a P230 million project to raise the town from its ghost status. The project is in the design and building phase of building an industrial hub for Phikwe; putting together an infrastructure in Bolelanoto and Senwelo industrial sites.
This project comes as a life-raft for Selibe Phikwe, a town which was turned into a ghost town when the area’s economic mainstay, BCL mine, closed four years ago. In that catastrophe, 5000 people lost their livelihoods as the town’s life sunk into a gloomy horizon. Businesses were closed and some migrated to better places as industrial places and malls became almost empty.
However, SPEDU has now started plans to breathe life into the town. Information reaching this publication is that Marcian Concepts is now on the ground at Bolelanoto and Senwelo and works have commenced. Marcian as a contractor already promises to hire Phikwe locals only, even subcontract only companies from the area as a way to empower the place’s economy.
The procurement method for the tender is Open Domestic bidding which means Joint Ventures with foreign companies is not allowed. According to Marcian Concepts General Manager, Andre Strydom, in an interview with this publication, the project will come with 150 to 200 jobs. The project is expected to take 15 months at a tune of P230 531 402. 76. Marcian will put together construction of roadworks, storm-water drains, water reticulation, street lighting and telecommunication infrastructure. This tender was flouted last year August, but was awarded in June this year. This project is seen as the beginning of Phikwe’s revival and investors will be targeted to the area after the town has worn the ghost city status for almost half a decade.
The International Monetary Fund (IMF) has slashed its outlook the world economy projecting a significantly deeper recession and slower recovery than it anticipated just two months ago.
On Wednesday when delivering its World Economic Outlook report titled “A long difficult Ascent” the Washington Based global lender said it now expects global gross domestic product to shrink 4.9% this year, more than the 3% predicted in April. For 2021, IMF experts have projected growth of 5.4%, down from 5.8%. “We are projecting a somewhat less severe though still deep recession in 2020, relative to our June forecast,” said Gita Gopinath Economic Counsellor and Director of Research.
The struggle of humanity is now how to dribble past the ‘Great Pandemic’ in order to salvage a lean economic score. Botswana is already working on dwindling fiscal accounts, budget deficit, threatened foreign reserves and the GDP data that is screaming recession.
Latest data by think tank and renowned rating agency, Moody’s Investor Service, is that Botswana’s fiscal status is on the red and it is mostly because of its mineral-dependency garment and tourism-related taxation. Botswana decided to close borders as one of the containment measures of Covid-19; trade and travellers have been locked out of the country. Moody’s also acknowledges that closing borders by countries like Botswana results in the collapse of tourism which will also indirectly weigh on revenue through lower import duties, VAT receipts and other taxes.
Latest economic data shows that Gross Domestic Product (GDP) for the second quarter of 2020 with a decrease of 27 percent. One of the factors that led to contraction of the local economy is the suspension of air travel occasioned by COVID-19 containment measures impacted on the number of tourists entering through the country’s borders and hence affecting the output of the hotels and restaurants industry. This will also be weighed down by, according to Moody’s, emerging markets which will see government losing average revenue worth 2.1 percentage points (pps) of GDP in 2020, exceeding the 1.0 pps loss in advanced economies (AEs).
“Fiscal revenue in emerging markets is particularly vulnerable to this current crisis because of concentrated revenue structures and less sophisticated tax administrations than those in AEs. Oil exporters will see the largest falls but revenue volatility is a common feature of their credit profiles historically,” says Moody’s. The domino effects of containment measures could be seen cracking all sectors of the local economy as taxes from outside were locked out by the closure of borders hence dwindling tax revenue.
Moody’s has placed Botswana among oil importers, small, tourism-reliant economies which will see the largest fall in revenue. Botswana is in the top 10 of that pecking order where Moody’s pointed out recently that other resource-rich countries like Botswana (A2 negative) will also face a large drop in fiscal revenue.
This situation of countries’ revenue on the red is going to stay stubborn for a long run. Moody’s predicts that the spending pressures faced by governments across the globe are unlikely to ease in the short term, particularly because this crisis has emphasized the social role governments perform in areas like healthcare and labour markets.
For countries like Botswana, these spending pressures are generally exacerbated by a range of other factors like a higher interest burden, infrastructure deficiencies, weaker broader public sector, higher subsidies, lower incomes and more precarious employment. As a result, most of the burden for any fiscal consolidation is likely to fall on the revenue side, says Moody’s.
Moody’s then moves to the revenue spin of taxation. The rating agency looked at the likelihood and probability of sovereigns to raise up revenue by increasing tax to offset what was lost in mineral revenue and tourism-related tax revenue. Moody’s said the capacity to raise tax revenue distinguishes governments from other debt issuers. “In theory, governments can change a given tax system as they wish, subject to the relevant legislative process and within the constraints of international law. In practice, however, there are material constraints,” says Moody’s.
‘‘The coronavirus crisis will lead to long-lasting revenue losses for emerging market sovereigns because their ability to implement and enforce effective revenue-raising measures in response will be an important credit driver over the next few years because of their sizeable spending pressures and the subdued recovery in the global economy we expect next year.’’
According to Moody’s, together with a rise in stimulus and healthcare spending related to the crisis, the think tank expects this drop in revenue will trigger a sizeable fiscal deterioration across emerging market sovereigns. Most countries, including Botswana, are under pressure of widening their tax bases, Moody’s says that this will be challenging. “Even if governments reversed or do not extend tax-easing measures implemented in 2020 to support the economy through the coronavirus shock, which would be politically challenging, this would only provide a modest boost to revenue, especially as these measures were relatively modest in most emerging markets,” says Moody’s.
Botswana has been seen internationally as a ‘tax ease’ country and its taxes are seen as lower when compared to its regional counterparts. This country’s name has also been mentioned in various international investigative journalism tax evasion reports. In recent years there was a division of opinions over whether this country can stretch its tax base. But like other sovereigns who have tried but struggled to increase or even maintain their tax intake before the crisis, Botswana will face additional challenges, according to Moody’s.
“Additional measures to reduce tax evasion and cutting tax expenditure should support the recovery in government revenue, albeit from low levels,” advised Moody’s. Botswana’s tax revenue to the percentage of the GDP was 27 percent in 2008, dropped to 23 percent in 2010 to 23 percent before rising to 27 percent again in 2012. In years 2013 and 2014 the percentage went to 25 percent before it took a slip to decline in respective years of 2015 up to now where it is at 19.8 percent.