Top Five Technology, Media & Communications Industry Trends For 2001.

The technology, media and communications sectors are moving fast. Industry leaders are changing their agendas constantly to keep up with the rapid pace of this dynamic market. If there was one lesson learned from all the activity in this industry in 2000, it was that the lines between the three are becoming blurred. After a decade-long debate, the convergence prognostications have become reality.

To better gauge how convergence has become an everyday truth for leading companies competing in this space, Arthur Andersen conducted a global survey of 125 of the most senior decision-makers at key high tech, telecom and media/entertainment companies. The results of this survey illustrate that as we move into 2001, the executive-suite strategies across all three sectors will continue to converge.

Arthur Andersen found that the top issues facing executives in these three sectors were, in fact, very similar. Despite their unique competitive situations, the majority of all companies in the technology, content and information creation, and telecom sectors shared five key business issues. Arthur Andersen predicts that these five issues will shape the decision-making agenda for the converging sector well into next year:

The Explosion of Digital Markets

Arthur Andersen’s research shows that digital marketplace growth will nearly double between 2000 and 2001. This growth presents enormous opportunities for companies to profit, on both the sell-side and buy-side, but only if they can predict accurately their customer needs and develop solutions to address those needs.

Wireless Revolution

Senior decision-makers identified eight different technology capabilities that would have either a high or moderate impact on their business. Issues related to mobility, especially wireless data access, ranked as having the greatest impact across not just telecom, but also the media/entertainment and high tech application and hardware sectors. Whether it’s mCommerce, wireless voice and data, or mobile media content access, senior executives are clear: if wireless is not a part of your business model, it definitely should be.

Convergence – at last

Product Integration: As globalization moves the world toward a common marketplace, companies are finding it increasingly difficult to provide a single product or service. In the new economy, companies no longer provide products — they provide a suite of services. With so many options for services at their disposal, executives believe that customers are increasingly looking to companies that can give them solutions to all of their information and entertainment access and management needs.

Competitive Convergence: Fifty percent of executives surveyed reported a strong interest in competing in new industries and, most importantly, a concern for the competitive threats they face not just from other companies in their sector, but from entirely new industries. As industry lines become increasingly blurred, companies will face difficult strategic choices about their competitive landscape.

War for Talent

Never has the war for talent been so brutal, and it will only intensify in the year to come. Surprisingly, even after the so-called “dot-com fallout,” talent continues to exit traditional organizations at an alarming pace. Executives in all three sectors ranked issues related to the attraction and retention of human capital extremely urgent. In response to this issue, companies are outsourcing specific tasks and, in some cases, entire functions. Executives believe this approach will become increasingly common.

Creating Value

After the recent stock market retraction, creating long-term shareholder value is suddenly back in vogue! The drive for real value creation will emerge as the single most important executive agenda item in the coming year. While the classic interest in positive earnings will be strong, value creation will take other important forms, including the quality of customer relationships, the efficiency of supplier connections and the satisfaction of key employees. In 2001, companies move away from “eBusiness” for the sake of “eBusiness.” Instead, they will increasingly focus using the Internet and web-enabled technology in combination with traditional business skills to connect to all of their sources of value: customers, suppliers, employees and investors.

The Arthur Andersen survey, which was conducted by KS&R, focused on senior decision-makers in the technology, media and communications companies with positions in marketing, finance, operations, strategy or business development. The sample included 125 respondent companies based in North America, Europe, Asia Pacific and Latin America.

For more information at http://www.arthurandersen.com.