Atos - Registration Document 2016

B Atos positioning and strategy B.2

Market sizing and competitive landscape [G4-8] et [G4-13]

Market sizing and competitive landscape

B.2

[G4-8] et [G4-13]

Overall market size

B.2.1

trailed off in 2016. Longer term, it’s expected that buyers will provide strong demand in the market; the server segment was particularly strong in 2015 due to • enterprise installed base refreshes, but demand subsequently external controller-based (ECB) storage continues to be • revised downward slightly, as a result of the impact of be about $28.3 billion by 2020; systems and cloud delivery on these traditional ECB storage platforms. The total ECB storage spending is now expected to alternative architectures such as hyper-converged integrated representing 26.2% or $1.0 trillion grew 4.5% in 2016. Of this sum, hardware and software support activities represent IT services (Business IT services and IT product support): • center outsourcing. Global spending on IT outsourcing (ITO) is forecast at a five-year CAGR of 5.8% through to 2020. expected to grow at 4.7%, ranging from a 33.7% CAGR for public cloud compute services, to a 4.6% decline for data despite Atos’ rapid expansion in the US remains the Group’s principal field of play. Through 2020, the IT services market is which, around 30.4% or $274 billion is in Europe, which $100 billion. Therefore the size of the IT services market where Atos is primarily active is sized at $900 billion, of Overall, IT spending results vary greatly by region. The largest region remains North America, with $1.16 trillion. However, the growth is sub-Saharan Africa, with 2016 constant-currency fastest-growing region is emerging Asia/Pacific, with 2016 constant-currency growth of 3.2%. The next best region for growth of 2.6%. The remaining regions are facing growth rates between negative 1.9% and 2.2%.

Overall worldwide IT spending is estimated to be worth $3.82 trillion (in constant currency); representing a 0.9% growth in 2016. Key segments had contrasting growth rates: mobile services, enterprise fixed services and enterprise mobile services) represents 41.4% of the IT market in communications Services (consumer fixed services, consumer • constant dollars, and has seen a modest growth of 0.3% to $1.58 trillion in 2016. Enterprise customers remain focused on positive 1.6% in 2016; bundling of mobile services lead to a spending slowdown. However, enterprise mobile service growth remained at a services and global WANs. Increasing service provider consolidation and increased transparency in pricing and driving down costs via policies for Wi-Fi offload and contracts optimizing the number of their providers for communications devices (PCs and tablets, mobile phones, and printers): • negative -5.8% in 2016; represents 17.8% or $681 billion, with a projected growth of 9.6%, or $367 billion, shows a growth of 6.9% in 2016. Innovations in live chat, peer-to-peer communities, and enterprise software (including security products): representing • 13.2% in this CRM segment; improved customer service and support. This leads to a predicted five-year compound annual growth rate (CAGR) of machine-learning powered engines to automate agents are driving a surge of investment from organizations seeking demand is expected to stay robust, despite the disruptive forces of software-defined infrastructure and cloud delivery; data center systems and servers: represents 5% at • $193 billion, with a projected growth of 2.3% in 2016. User

2016 Business IT Services spend and growth

(in € billion)

2016 growth vs. 2015

America (Canada, USA, and Latin America)

413.2 274.3 213.0 900.5

+23.1 +11.3

+5.9% +4.3% +4.2%

Europe

Rest of the World

+8.6

Total +5.0% Source: Atos estimates and Gartner for Professional Services (Consulting, Implementation, IT Outsourcing, process management) in constant currency (Constant 2016 Dollars) +43.0

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