LDN Market Barometer

Transcription

1 LDN Market Barometer 2 nd Quarter 29 and forecast for 3 rd Quarter 29 Introduction This is the third quarterly report into the state of the IT training market produced for the members of the Learning Directors Network. The data is drawn from a number of leading training providers representing more than 4% of the third-party IT training market. The report, compiled by Pardo Fox Ltd, is based around a series of index numbers indicating growth or decline of various slices of the market, not absolute numbers or volumes. The scale ranges from + to -, where represents neither growth nor decline, and + represents growth in excess of 1% for all training companies and - represents decline in excess of 1% for all training companies compared to the same quarter in the previous year. Revenue refers to training delivered in the quarter and not bookings for future courses. All data shown in this report pre-dating Q4 of 28 is the copyright of IT Skills Research. It was compiled using the same methodology, but note that the section of this survey that was previously called E-learning was renamed (or replaced with) Learning Technologies in order to reflect the growing use of technology in the teaching of IT and in its wider use for managing learning. Institute of IT Training / Learning Directors Network 29 Page 1

2 Overview The rate of decline in IT training revenues in the second quarter of 29 turned out to be not only greater than expected, but the sharpest decline ever recorded. Three months ago, the forecast index number for Q2 revenue growth was -2 (-24 weighted), but the outcome was far worse at -37 (and -46 weighted). Input from contributors to the survey indicates that in terms of actual revenues, this represents an average fall of approximately 17%. Their forecast index of -43 for the present quarter shows the prospect of a similar drop in revenues. The chart below shows how total IT training revenue has grown in each quarter over the last four years. The solid bar indicates the average growth index of the contributing companies; the line graph represents the index number when due allowance has been given to the relative size of those companies. In the main, the larger companies were growing more slowly than the smaller ones for the first two years, but then matched and occasionally exceeded the smaller companies' growth rates for the next three years. This latest chart shows that the larger companies suffered more than the smaller ones in 2Q9. Revenue and Profit Indices 4Q8 1Q9 2Q9 F/cast 3Q9 Total IT Training Revenue - unweighted (4) (14) (37) (32) Total IT Training Revenue - weighted (3) (7) (46) (43) Total IT Training Profit (1) (9) (18) (32) Total IT Training Revenue - - 5Q3 5Q4 6Q1 6Q3 7Q1 7Q3 8Q1 8Q3 9Q1 9Q3 6Q2 6Q4 7Q2 7Q4 8Q2 8Q4 9Q2 The dots in the 9Q3 column indicate the forecast rate of decline compared to the third quarter of 28. Institute of IT Training / Learning Directors Network 29 Page 2

3 The index for training company profits closely follows the pattern of total revenue, but while the decline in profits was not as steep in Q2 as the decline in revenues, the expected decline for Q3 is equally severe. IT Training Profit - - 5Q3 5Q4 6Q1 6Q3 7Q1 7Q3 8Q1 8Q3 9Q1 9Q3 6Q2 6Q4 7Q2 7Q4 8Q2 8Q4 9Q2 There is no weighted index for profit. Institute of IT Training / Learning Directors Network 29 Page 3

4 Decline Growth Instructor-led Training All three areas of ILT suffered equally this quarter. As in previous quarters, public (scheduled) courses suffered more than on-site (one-customer) courses, and for more than one of the contributing companies, on-site revenue was actually growing compared to last year while public and total ILT revenues were falling. Instructor-led Training Indices 4Q8 1Q9 2Q9 3Q9 End-user (6) (2) (28) Technical (2) (23) (36) Personal, Professional & Business skills 7 (14) (31) Public (scheduled) courses (14) (2) (37) On-site (one-customer) courses (2) (15) (14) Total ILT Revenue - unweighted (6) (19) (34) (34) Total ILT Revenue - weighted (7) (9) (44) (44) ILT Revenue - - 5Q3 5Q4 6Q1 6Q3 7Q1 7Q3 8Q1 8Q3 9Q1 9Q3 6Q2 6Q4 7Q2 7Q4 8Q2 8Q4 9Q2 Institute of IT Training / Learning Directors Network 29 Page 4

5 Decline Growth Learning Technologies Revenue While revenues from learning technologies were generally flat compared to the same quarter last year, there was some significant growth in infrastructure, but generic content and consultancy reported a decline. Under the new definitions: Generic Content includes generic courseware, templates, and models Tools includes authoring, performance support, virtual labs, simulation, collaboration, modelling, and assessment tools Infrastructure includes LMS/ LCMS/CLS, enterprise content management, performance management, competence management, e-skills portfolio management, social networks Development: the facilitation of client content and bespoke development of solutions using learning technologies Consultancy: services that support the client in the application of learning technologies - includes strategy, vision and direction, engagement models, advice and guidance. Learning Technologies Indices 1Q9 2Q9 3Q9 Generic content (5) (1) Tools 8 Infrastructure (2) 2 Development 6 5 Consultancy 7 (5) Total Learning Tech Revenues - unweighted (5) (2) Total Learning Tech Revenues - weighted 21 (6) 4 Learning Technologies Revenue - - 5Q3 5Q4 6Q1 6Q3 7Q1 7Q3 8Q1 8Q3 9Q1 9Q3 6Q2 6Q4 7Q2 7Q4 8Q2 8Q4 9Q2 Institute of IT Training / Learning Directors Network 29 Page 5

6 Training Support Services The market for training support services, having proven to be rather more resilient than the rest of the market, suddenly finds itself in sharp decline, with outsourcing and managed training services suffering most. Training Support Services Revenue - - 5Q3 5Q4 6Q1 6Q3 7Q1 7Q3 8Q1 8Q3 9Q1 9Q3 6Q2 6Q4 7Q2 7Q4 8Q2 8Q4 9Q2 Training Support Services Indices 4Q8 1Q9 2Q9 3Q9 Outsourcing and MTS (28) Pre- and post-training consultancy Total TSS Revenues - unweighted 1 13 (3) (17) Total TSS Revenues - weighted (35) (36) Institute of IT Training / Learning Directors Network 29 Page 6

7 Certification The market for IT Certification continues to be flat, although end-user certification continues its decline. IT Certification - IT Professional End-user Combined Forecast - 7Q3 7Q4 8Q1 8Q2 8Q3 8Q4 9Q1 9Q2 9Q3 IT Certification Indices 4Q8 1Q9 2Q9 3Q9 IT Professionals 14 End-users (6) (17) Total Certification 12 6 On the next page are some of the comments from the contributors to the survey. Institute of IT Training / Learning Directors Network 29 Page 7

8 Which subject groups saw the biggest increases or decreases in your training revenues last quarter? Decreases in technical system administration and high end technical Biggest increase: e-learning; biggest decrease: on-site ILT Bespoke e-learning development up (although on small numbers) Increase in e-learning development, decrease in ILT scheduled courses for end users End-user down slightly; M&PD up (but long buying cycles) Project and PowerPoint seem to have disappeared altogether VMWare, Citrix, sales training all increased, Cisco decreased Storage and Virtualisation are up; Unix and ITSM are down Public courses now hugely down on last year Technical training biggest fall; PM & ITIL fairly stable. We were quiet in all areas Other comments In response to the question Have you noticed any recent or unusual changes in the way your business is generated, such as enrolment patterns, or do you have any comment on the state of the IT training market generally? Once into the month, very little movement Dire! People are leaving confirmation to the very last minute. We have seen all the decrease in public bookings, with onsite bookings remaining unchanged. Very late booking cycle Late cancellations and re-booking Budgets on hold Increase in tenders and, having won a bunch, am feeling very hopeful for September onwards Public Schedule bookings coming in at shorter notice Customer sign off for on sites taking much longer More tailored/onsite requests compared to Public attendance Companies are booking much later Pressure for higher discounts is now common Institute of IT Training / Learning Directors Network 29 Page 8

9 Q1 Q2 Q3 Q4 1Q1 1Q2 1Q3 1Q4 2Q1 2Q2 2Q3 2Q4 3Q1 3Q2 3Q3 3Q4 4Q1 4Q2 4Q3 4Q4 5Q1 5Q2 5Q3 5Q4 6Q1 6Q2 6Q3 6Q4 7Q1 7Q2 7Q3 7Q4 8Q1 8Q2 8Q3 8Q4 9Q1 9Q2 Q1 Q2 Q3 Q4 1Q1 1Q2 1Q3 1Q4 2Q1 2Q2 2Q3 2Q4 3Q1 3Q2 3Q3 3Q4 4Q1 4Q2 4Q3 4Q4 5Q1 5Q2 5Q3 5Q4 6Q1 6Q2 6Q3 6Q4 7Q1 7Q2 7Q3 7Q4 8Q1 8Q2 8Q3 8Q4 9Q1 9Q2 The outlook The charts below show the index numbers for the past nine years. In last quarter s survey, the graphs indicated that the current slump might be no more severe than the recession of 21-23, but this quarter s results are far worse than anything we have seen before. The current forecast for Q3 is also at the bottom of the scale. Let us hope that the severity of the decline will be offset by an early return to growth. Total IT Training Revenue - - IT Training Profit - - Institute of IT Training / Learning Directors Network 29 Page 9