BSRIA UPDATE Structured Cabling Market, Data Centers,IIMS and Potential New Studies

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BSRIA UPDATEStructured Cabling Market, Data
Centers,IIMS and Potential New Studies
January 2009
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Agenda

• Global trends in structured cabling
• US/UK Data Center Studies
• BSRIA Consultancy
• IIMS
• Current studies and plans for 2009/2010

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BSRIA Worldwide Market IntelligenceI.T.
Networks Associated Technologies

• Small team covering up to 40 countries
• Offices in the UK, China, France Germany
• Special topic reports on technologies impacting
  the SCS market
• Close tracking of individual country economies
  and construction activity
• Face-to-face and telephone interviews with key
  suppliers, distributors and SIs/VARs in each
  country

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Countries Covered Worldwide

• EUROPE
• GERMANY
• UK
• FRANCE
• NETHERLANDS
• ITALY
• SPAIN
• SWITZERLAND
• BELGIUM
• AUSTRIA
• SWEDEN
• NORWAY
• FINLAND
• DENMARK
• PORTUGAL
• POLAND
• RUSSIA
• HUNGARY
• UKRAINE

• AMERICAS
• USA
• CANADA
• BRAZIL
• ARGENTINA
• MEXICO
• CHILE

• ASIA PACIFIC
• CHINA
• AUSTRALIA
• SOUTH KOREA
• JAPAN
• INDIA
• HONG KONG
• ASEAN
• SINGAPORE
• VIETNAM

95 of the global structured cabling market
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Market Size Structured Cabling and Key Trends
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Global Structured Cabling Market, 2007/2008by
Product Type
Singlemode fibre cable 1.8
Fibre connectivity 3.7
Multimode fibre cable 11.1
Copper cable 47.2
Copper connectivity 36.2
US 4.9 billion
Source BSRIA
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Global Structured Cabling Market, 2003 2010
Est. 4.97 bill Rev. 4.95 bill increase 0.5-1
Est. Flat Rev. Decrease 4-5
US mill
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Top 10 Countries for Structured Cabling, 2007
US mill
Source BSRIA
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Growth Forecast 2007 - 2010
Credit crisis Negative growth Will have it's
impact
Source BSRIA
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Market Size vs. Market Growth Matrix 2007 - 08
High
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Market Growth Rate 2007-08
0
-30
High
Market Size 2008
Low
150 Million
1700 Million
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2008 Preliminary Results

• Growth High 10
• India
• China
• Russia
• Brazil/Mexico
• Argentina

• Growth Medium
• Australia
• Germany
• Middle East
• Eastern Europe

• Flat
• Spain
• France

• Decline
• US
• UK
• Italy

Source BSRIA
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2009 Preliminary Forecast

• Growth
• India (10-15)
• China (8-10)

• Decline
• UK (10-15)
• US
• Russia (27)
• Spain (20)
• Italy (5-10)
• France (3-5)
• Germany (1-3)
• Austria (23)

• Flat to minor growth
• Latin America
• Middle East
• Australia

Source BSRIA
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Global Trends 2008/9

• First half of 2008 business as usual
• Business slowed down August October
• Drastic decrease in demand in November/December
• 4thQ (3rdQ) Projects postponed or cancelled
• 1stQ 2009 End-user confidence down, slow market
• - some carry-over
• Private investment significantly down
• Government investment up (schools, universities,
  infra-structure, healthcare, central and local
  authorities etc.)

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Price Developments

• Prices remained stable year-on-year from June
  2006 4Q of 2008
• Some countries had price increases July/August
  2008
• Massive drop in copper material prices Autumn 08
  (back to 2005 level), but no general price
  reduction
• Few suppliers reduced prices Nov/Dec 2008, but
  most suppliers choose to offer further project
  discount (target/localised)
• Exceptions - China pressure from Oct 2008
• - Russia price erosion started!

Source BSRIA
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Price Comparison A Box (100 ft) UTP Cat 5e, PVC
Cable
Source BSRIA
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High Penetration of Cat 6

• Cat 6 penetration
• German speaking countries (80-95)
• Middle East (75-95)
• France,Netherlands (65)

• Cat 6A penetration
• High uptake of Cat 7 cables with shielded Cat 6
  or Cat 6A connectivity
• Low penetration of Cat 6A
• 4 - 5

2008 est. by volume
Source BSRIA
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Cat 5e Sales Continue to be High

• Cat 6A penetration
• 1
• 1 3
• Only very few projects
• 11
• 4

• Cat 5e sales
• Japan 6570
• Latin Americas (65-70)
• China 57
• Russia 50 and increasing in 2009
• US 51-52

2008 est. by volume

• Cat 5e (35 - 45), Cat 6 (50- 60) Cat 6A (2
  - 5)
• UK, Spain, Denmark, Norway, Sweden, Italy, India,
  Australia

Source BSRIA
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China

• China been spending 40 of GDP on business
  investments gt excess capacity
• Exports have fallen since Nov 08 Can internal
  demand be stimulated to replace it?
• Pressure on cable prices when the copper material
  price dropped (from Oct 08). Increased (15)
  beginning of 2008
• Slowed down Q4 2008 and the trend continues in
  2009
• Data centre only very small segment (3 5)
• Ningbo Ship, LTK, Potevio (Putian), Orient
  Daikin, Sunf Pu, Wonderful Wire are increasing in
  importance in China

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Russia a Developing Market

• 3 of the global market (2008)
• Massive growth in 2006, 2007 and 2008 fuelled by
  construction and material price increases
• Dec 2008/Q1 2009 prices expected to fall
  significantly
• Consumer confidence down. Projects on hold or
  cancelled. Volume to decline 20 in 2009
• Focus on cost savings (Cat, brand, size)
• Growth expected in 2010 and 2011

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U.K. U.S.Data Center Studies
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US Data Centre and LAN Market

• LAN 1.65 bill
• DC 360 mill
• DC 18 of total
• Fiber cable problematic in DC report
• - pre-term
• - link lengths
• - value of links

Source BSRIA
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Subjects Covered by Data Center End-User Studies

• Cabling market size
• Cabling type and location
• Cable jacket type
• Brands
• 10G cable choice
• 40G and 100G -
• current plans
• Switch port utilisation

• Pre-terminated cable
• Fiber connectivity
• Replacement rates
• Network impact from blade servers
  virtualization
• Most important criteria in selection of system
  and supplier

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Size of Data Centres in the Studies
No. Respondents 250 US 120 UK
Source BSRIA
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Plans to Install 10G Copper Cablingin the Near
Future in the Data Centre

• 10G copper cabling options listed
• Cat 6 shielded (F/UTP)
• Cat 6A unshielded or shielded
• Cat 7
• Cat 7A
• CX4 (10GbE) cable

No. Respondents 120
Source BSRIA
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Most Likely Choice for Future Data Center 10G
Copper Cabling Solution - U.K.
No. Respondents 120
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Would Like to Install 10G Active Equipment for
Copper Cabling
U.K. 2008
U.S. 2007
No. Respondents 180
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Plans for All Speeds in the Data Center end 2009
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The Copper-Fiber Split in the Data Center
Network - U.K.As at end 2007 and Planned for end
2008
No. Respondents 120
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How Often Replace Copper Fiber Cabling in the
Data Center Network - U.K. 2008
By No. Respondents
No. Respondents 100
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How Often Replace Equipment in the Data Center
Network - U.S. 2007 U.K. 2008
By Percent Respondents
No. Respondents U.S. 250 U.K. 120
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40G in the Data Center Network by Layer U.K.
2008 2010
40G Plans
Current 40G by Layer
No. Respondents 77 120 Note The vertical
scales are the same on this slide.
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40G and 100G by Layer in the Data Center - U.K.
2008 2010
No. Respondents 77
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Current Fiber Cabling Installed in the Data
Center - U.S. 2007 U.K. 2008
No. Respondents U.S. 239 U.K. 110
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Preference for End-to-End Systems in the Data
Center - by Size - U.S. 2007 U.K. 2008
Resps
No. Respondents U.S. 250 U.K. 120
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Type of Protocol Used in the Data Center - U.S.
2007 U.K. 2008
No. Respondents U.S. 250 U.K. 120
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Future Expansion Plans in the Next 5 Years Data
Center - U.S. 2007 U.K. 2008
No. Respondents U.S. 250 U.K. 120
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Most Important Criteria When Selecting a
Location For the Data Center - U.K. 2008
New open question No. Respondents 114
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The Factor that will have the Largest Impact on
the Data Center Cabling Infrastructure in the
Future
Open question No. Respondents UK 115 US 201
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BSRIA Consultancy- A Brief Introduction
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Methodology
PHASE 1
PHASE 2
Market Analysis - WMI
Recommendations (including financial) - BMC
Internal Analysis - BMC
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• SEGMENTATION

• FORECASTS

Management Consultancy
Market Research

• PRICING

• DISTRIBUTION COMPETITIVE INTELLIGENCE

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Analysis of Clients Internal Data

• Financial data

Management Consultancy
Market Research

• Commercial data

• Comparison Vs. market

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Detailed Recommendations Action Plans
Financial Data

• INVESTMENT ESTIMATES

• SALES TARGET SETTING

Management Consultancy
Market Research

• CASH FLOW FORECAST

• ACTION PLANS

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What BSRIA Consultancy Offers

• Commercial due diligence

• In our commercial due diligence we take into
  account the latest news and trends of the
  industry. This enables us to contrast the company
  strategy with the current market
• This document also contributes to gain visibility
  of new opportunities and risks

• Business plan evaluation

• The business plan assessment supplies expert
  opinion about the viability of the company in
  strategic and commercial terms
• Moreover, it includes recommendations about the
  key aspects, supported with calculations and
  logical arguments

• Market research

• This document integrates external market factors
  as well as strategic positioning and the internal
  situation of the client. It is structured in
  dynamic and predictive models considering
  different scenarios, facilitating the decision
  making process

• Assessment/Creation of Vendor's book

• The vendors book has the competitive advantage
  of integrating BSRIA experience in the industry
• The deliverable integrates the financial
  information with information on the marketplace
  and the companys strategy. The commercial
  language used is clear and concise.

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Examples of Completed Projects
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Old Bracknell Lane West Bracknell Berkshire RG12
7 AH United Kingdom 44 (0) 1344 465600
c/ Juan Ramón Jiménez 9, 1º Madrid
28036 Spain 34 91 185 42 37
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Intelligent Infrastructure Management Systems
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Intelligent Infrastructure Management Systems
(IIMS)
No-IIMS
IIMS
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Global Sales of IIMS, 2005 - 2007
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IIMS Sales by Region, 2005 - 2007
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Sales of IIMS by Generic Solution, 2006 2007by
Volume - no. of Managed Ports
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Reasons for Growth?

• Global roll out (mainly Financial sector)
• Increasing number of installations in medium
  sized companies
• Large projects such as airports
• Increasing awareness
• Premium reduced, now 15 - 25

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Plans to Install IIMS in the Near Futurein the
Data Center - U.K. 2008
Where no IIMS currently exists
Open question No. Respondents 79
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Primary Reason Have Installed an IIMS in the
Data Center - U.K. 2008
Open question No. Respondents 37
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Barriers for Further Uptake of IIMS

• Lack of understanding and awareness, but less of
  an issue now
• Lack of compatibility between systems
• Cost of solutions
• Cost of implementation and training

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Primary Reason for NOT Installing IIMS in the
Data Center - U.K. 2008
Open question No. Respondents 78
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How To Be Successful in IIMS

• Stay with the projects until the system is fully
  employed
• Continue to provide service and back-up
• Vendor representation or competent SI
• Continuing updates of products and software
• Further projects
• Loyal customer!

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Plans for 2009 / 2010
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Cabling Portfolio
Data Centre UK
Data Centre US
Data Centre India?
Verticals USA
Verticals China
Wireless
10G
Cabling in Buildings
Residential C.
VoIP
IIMS
North America
Residential C.
Europe
Wireless / VoIP
Asia Pac.
Asia Pac.
Middle E.
Middle E.
Middle E.
Latin Am.
Latin Am.
Runner 20 21 countries per year
Europe
Europe
1995
1999/2000
2006
2002
2004
2003
2005
2007
2008
2010
2009
2001
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Impact on Cabling of WLAN and VoIP Update

• Penetration of WLAN
• Impact on cabling (addition/reduction in cabling)
• Barriers and new regulations
• Applications and wireless only installations
• Implementation of VoIP
• Integration of VoIP and WLAN

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High Speeds in Commercial Networks

• Uptake of Cat 6A, Cat 7 and OM3 fibre
• High speeds in Data centres, server rooms and LAN
• Choice between copper and fibre
• Protocol choices
• Main suppliers
• Barriers
• Active equipment and their availability

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Quarterly Forecast - U.S.

• U.S. first
• Potentially other key countries (regions)
• Forecast for structured cabling (Copper Fibre)
• Forecast based on
• Economic trends
• Construction, planning applications
• Copper prices and other energy/material prices
• Panel (selected channel players, consultants,
  VARs)
• Output trends - mainly up, down, flat

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BSRIA Market Sizing Project for CABA

• BSRIA in discussion with CABA (Continental
  Automated Buildings Association) of North America
  about a major market study
• Project would be commissioned by CABAs
  Intelligent Integrated Buildings Council (IIBC)
• IIBC is proposing a market sizing exercise of the
  North American market for intelligent and
  integrated building technologies used to create
  high performance green sustainable buildings
• Scope
• Environmental (HVAC) Controls / Building
  Automation
• Security Systems (Access Control, CCTV, Intruder
  Alarm)
• Fire Detection and Alarm
• IT-Convergence
• Lighting Systems
• Water Saving / Control Systems
• Audio Visual and Digital Signage Systems

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BSRIA Market Sizing Project for CABAIntelligent
Building Products

• BSRIA has a proven track record in these subjects
  around the world and extensive North American
  experience
• Project comprises in-depth studies of these
  markets by value of products/systems, value-add,
  services, vertical markets by building type
• Project will build on Proplans historical data
  and proven methodology of face-to-face interviews
  and data gathering directly from manufacturers
• Project expected to start around March/April 2009
  for publication around September/October 2009
• A CABA mailing on the content and scope will be
  available in February and will be featured at the
  ASHRAE (AHR Expo) event in Chicago 26 January
  2009
• Please refer to CABAs Ron Zimmer or Alex Detre
  for details or sponsorship (tel [phone] /
  www.caba.org)

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Use of Structured Cabling in Building Control
Networks
Management Level
Highest
Automation Level
Field Level
Lowest
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Greatest Use of Structured Cabling in Security
Systems

• Access Control systems

Hybrid CCTV systems
Total IP CCTV systems
Intruder Alarm systems
Highest
Lowest
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Drivers and Barriers for Convergence

• Drivers
• Upgrading the existing infrastructure (from
  Analogue to Digital)
• Networked and accessible remotely
• Open communication protocols
• Convergence of Physical and Logical (I.T.)
  Security

• Barriers
• Lack of knowledge
• Educating installers
• Prices tend to escalate when upgrading the
  infrastructure
• BAS suppliers lack control of network performance
• Broadcasting approach (used by BAS) not permitted
  on some routers and switches

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Increasing Use of Structured Cabling in
Intelligent Building Control Systems
Controls
Intruder Alarm
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Strategic Overview

• Top 15 suppliers by product and by region
• Global and regional trends
• Electrical suppliers and channel
• Private label (distributors)
• Production and increasing sales by local
  suppliers
• Penetration of Cat 6A
• Shielded or UTP Cat 6A?
• Residential cabling

• Company profiles of the top 10 largest companies
• CommScope (Systimax)
• Belden (Mohawk)
• Tyco Electronics
• Nexans (Berk-Tek)
• Panduit
• ADC Krone
• Legrand (incl. Ortronics and TCL)
• Schneider Electric (Infra, Clipsal, LexCom, LK)
• Siemon
• General Cable

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Overview of Potential Studies

• Updates or new markets
• WLAN and VoIP
• Verticals in China
• Update of US Verticals
• Data Centres (India, Germany)

• New studies
• High speeds in Commercial Networks
• Quarterly Forecast
• Integrated Cabling in Buildings
• Strategic Overview
• Other suggestions????

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THANK YOU