Cap Gemini - Registration Document 2016

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PRESENTATION OF THE GROUP AND ITS ACTIVITIES

1.4 The market and the competitive environment

The market and the competitive environment 1.4

trends global trends in solutions focused on Cloud, Analytics / Cognitive The IT service landscape continues to evolve rapidly. 2016 saw Cybersecurity. Computing, Digital Transformation of client portfolios and analytics and cognitive solutions in the coming 5 years. business buyers; and close to €381 billion will be spent in in from digital and cloud; 50% of IT budgets will be controlled by reports, over 50% of IT spending in the next 5 years will come buyers and new engagement models. According to market focus. Technology spending is moving to new solutions, new The market has also continued to shift rapidly in both sector and triggered by the spectacular development of offshore services In addition to the major structural change in the IT services market development, 2016 saw the rapid development and deployment service consolidation and new intellectual property (IP) as IT service providers being responsive to pricing pressures, (launched in the early 2000s by Indian service companies) as well their journey for new and disruptive strategies around Cloud, Cybersecurity solutions and how our clients “connect” securely in overlying all of these developments, are new trends in digital transformation of clients’ industry-specific portfolios. Also, Cognitive Computing and Digitization. the burgeoning “Internet of Things” (IoT), and the accelerated analytics and cognitive computing with customer use cases for of cloud computing solutions, new markets around “Big-Data”, industry-specific portfolios such as Cloud Transformation, Digital Marketing and Design, Real-Time Analytics and Cybersecurity. boutique and niche vendors being acquired to fill key gaps in more responsive to client needs. Also, the IT service industry saw client delivery and setting up digital centres of excellence to be service providers re-focusing efforts on IP-driven solutions for Rapid innovation continues across all market segments with IT engagements, clients are realizing the need to move fast into the No longer is the process about small pilots or multiple “test” Digital Transformation for clients is moving into the mainstream. capturing and analysing customer needs and behaviours to about changing the customer experience by continuously this new strategies and positioning. This Digital Transformation is digital space and are in need of IT service firms to assist them with organizational performance, development and maturation; and understanding people and organizations to continuously monitor assets, partners, suppliers, business processes and outputs. reviewing operations to continuously optimize performance of optimize and renew the future customer experience;

market share, based on this report from Gartner. (*) Capgemini is ranked sixth in this global market with 1.7% of global market is worth a global amount of approximately €824 billion. as defined by Gartner*, a US market analyst. This IT services Capgemini group is active in the professional IT services market markets of North America and Western Europe and maintains its billion). Per the report, the Group is ranked fourth in the combined approximately 29% of worldwide activity (approximately €239 billion). Western Europe is the second largest market representing first place position in France and the Netherlands. approximately 44% of worldwide activity (approximately €363 North America is the largest global market representing timeframes. while system integration activities have somewhat longer professional services, which have short cycles (and contracts), region specifically. The market is quite cyclical, especially for local ranks fifth in the world in combined totals and fourth in the EMEA approximately €469 billion according to Gartner. Here, the Group outsourcing market is estimated to be worth a total of The combined worldwide implementation and IT Competition Our global marketplace is rapidly evolving and we compete with a variety of organizations that offer solutions comparable to ours. Overall, our competitors include: Global Players (such as Accenture); ◗ marketplace are: The main competitive factors that we believe exist in the Ability to Deliver – in both individuals and products; ◗ Expertise - in technologies as well as industry sectors; Innovation – in training, services and product offerings; ◗ references; Reputation and Integrity – in both testimonials and client ◗ Value – in adding and improving business performance; ◗ Pricing – in contractual terms and pricing; ◗ to clients; Service and Scope – in bringing the right people and products ◗ Delivery – quality results on a timely basis; ◗ presence in key markets. Global Reach and Scale – in providing the right level of ◗ Our clients typically retain us on a non-exclusive basis. Advisory Service Players (such as Deloitte or PwC); ◗ Offshore Players (such as Cognizant or Wipro); and ◗ Regional and Boutique Players ◗

Gartner Report: “IT Services Market Share Report 2015” (Updated April 2016). (*)

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Registration Document 2016 — Capgemini