IT industry analysis assesses prospects, including product and service offerings, market analysis, competition, technological changes, industry trends, legal and regulatory changes, and the national and international economy. The sector covers hardware, software, and IT services, and researching the market is critical. The IT industry is highly competitive, and changes in technology greatly affect it. Legal and regulatory changes and national and international economies also impact the IT sector.
An information technology (IT) industry analysis is a method by which IT industry prospects are assessed. Some aspects that are often part of this analysis include expanded product and service offerings, a market analysis, competition, technological changes, and industry trends. Legal and regulatory changes, as well as the national and international economy, can also be part of the assessment.
This sector covers a wide range of products and services. Hardware products include mobile devices, personal computers (PCs), servers, mainframes, and semiconductor design and production. Software development and Internet technologies are also part of this sector. IT services such as technical support are also included. Industry offerings continue to expand as integration with telephony and consumer use of IT for activities such as watching television, movies and videos increases.
When conducting an IT industry analysis, researching the market is critical. IT industry market research looks at the demographics of IT users. Demographics include user characteristics such as age, gender, socioeconomic status, and region or nation. If the analyst is analyzing a consumer-oriented IT segment, psychographics, which detail the consumer profile, can also be part of the analysis.
The IT industry tends to be highly competitive. A study of the competition in the IT industry is usually included in the analysis. This section of the assessment may include characteristics of key competitors and their financial performance.
Changes in technology greatly affect the IT industry. A new technology can create opportunities or threats to which the industry must respond. An analysis of the IT industry will generally place a high value on technological advances and any potential effects.
IT industry trends will be included in most IT industry reviews. Trends can be initiated by technology changes as well as customer preferences. Some examples of trends include the outsourcing of services such as technical support and software development. Another trend has been towards powerful desktop processors, which have been enabled by technology improvements and user acceptance.
Legal and regulatory changes are also part of an IT industry review. An IT company may need to change its products or services to meet these requirements. Requirements are usually made by countries or regions, and a global company will have a range of national or regional regulations that must be followed and adhered to.
National and international economies affect the IT sector. Economic downturns can hurt some aspects of the IT industry, but help others. For example, as organizations respond to cost pressures, they can reduce hardware and software purchases. They may also start to outsource to control costs and thereby improve the prospects for outsourcing vendors.
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