Deloitte Technology, Media and Telecommunications predictions for 2014

Deloitte has releases its annual Techonology, Media and Telecommunications (TMT) predictions for 2014. The annual TMT report started back in 2001 and this years’ predictions are dominated by mobile devices. Here’s a look at the key predictions.

Big five to exceed USD $750 billion in sales

Deloitte expects global combined sales of smartphones, tablets, PCs, TVs and video games consoles to exceed USD $750 billion.  Smartphones are predicted to account for 50% of these sales. The report says smartphone sales will grow in sales and revenue but rate of growth will slow because the upgrade cycle on smartphones is lengthening (most people are comfortable with their current smartphones and new releases don’t have drastic changes). The report says the majority of smartphone sales over the next 5 years will come from the developing world. The report suggest that sales in these five products are $50 billion short from reaching a ceiling.

Wearables will have millions of early adopters

Deloitte is predicting sales from wearables (smart glasses, smart watches and fitness bands) to reach 10 million units worth USD $3 billion in 2014. Smart glasses are expected to generate the most revenue accounting for 4 million units at an average cost of $500 per unit.

VOD to grow by 1 million users in Sub-Saharan Africa

The  TMT report predicts that Video on Demand (VOD) users in Sub Saharan Africa (SSA) will grow by about 1 million, this despite a lack of fixed broadband infrastructure in the region. Although only one percent have access to fixed broadband in the region, VOD demand will come from high income household especially from South Africa and Nigeria, whose citizens account for 50% of all consumer spending in SSA.

In Zimbabwe, mobile device maker Astro is rumored to be working with Telone to introduce VOD, through a device called the Astro Box (Not in Deloitte report). The report says delivering high definition programming is expected to require 2 megabits per second of dedicated capacity in 2014.

SMS will continue to earn more revenues than Mobile Instant Messaging (MIM)

Although Instant Messengers will push 30 billion more messages daily, SMS will earn USD $100 billion in 2014, 50 times the value of all MIM services combined total revenues. The report outlines three main reasons why SMS generates more revenue.

Unlike MIM that is largely free, operates on different platforms, require smart devices and a data plan, SMS is a messaging standard common in almost all mobile phones. The Deloitte TMT says there are 3.2 billion unique mobile subscriber that can send text messages to each other. Deloitte expects SMS to continue generating significantly more revenues than IMs even up to 2017.

Do you see any of this happening? Download the full report.