Post on 11-Jan-2016
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Elisha Yanay- Senior VP Motorola Inc
General Manager Motorola IsraelChairman of the Board
Israel Association of Electronics & Information Industries
20th February 2007
The Israel Telecom Industry
The Computing & Electronic Industry
in Israel
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Israel
• Population: 6.9 M • Households: 1.8 M • Urban Population: 91.5% • Area - grand total 22,145 sq. km • GDP: US $ ~124.0 B • GDP Per Capita: US $ ~18.0 K • Fixed line Telephone Subs – 3.2M • Mobile – 7.18M (104% penetration) • Internet Users: 2.5M (ADSL: 1.5M)
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Region/Country 2002 2003 2004 2005 2006 2007
Americas 1.3 2.6 4.4 3.6 3.6 3.2US 1.6 2.7 4.2 3.5 3.5 3.1Canada 3.1 2.0 2.9 2.9 3.0 2.7Latin America -1.0 2.0 6.2 4.6 4.6 4.0 Brazil 1.9 0.5 4.9 2.3 3.5 3.7 Mexico 0.8 1.4 4.2 3.0 3.8 3.4 Argentina -10.9 8.8 9.0 9.2 7.5 5.0 Venezuela -8.9 -7.6 17.9 9.3 6.9 4.8
EMEA 1.6 1.8 2.9 2.2 2.6 2.4Western Europe 1.3 1.1 2.4 1.6 2.2 2.0Middle East & Africa 2.2 5.4 4.9 5.5 5.0 4.3Central/Eastern Europe 3.4 4.8 6.3 4.9 5.2 5.0Russia 4.7 7.3 7.2 6.4 6.2 5.8
Asia 2.6 3.7 4.4 4.4 4.2 3.8ASEAN 4.5 4.8 6.5 5.5 5.4 5.4Australia 4.1 3.1 3.6 2.5 3.2 3.4China 9.1 10.0 10.1 9.9 9.1 8.6Hong Kong 1.8 3.1 8.6 7.3 5.2 4.5India 4.6 8.5 7.5 7.9 7.3 7.4Japan 0.1 1.8 2.3 2.7 2.6 2.1New Zealand 4.3 3.9 4.4 2.2 1.2 2.2South Korea 7.0 3.1 4.6 4.0 5.1 4.7Taiwan 4.2 3.4 6.1 4.1 4.0 4.0
World 1.7 2.6 3.9 3.4 3.5 3.1
World Economic Growth Solid…Real GDP Growth
(Year-Over-Year % Change)
Israel 4.4 5.2 5.0 4.0-1.2 1.7
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ISRAEL ELECTRONICS & SOFTWARE INDUSTRIES SALES & EXPORT (M$)
2,79
51,
801
3,37
51,
935
3,97
02,
030
4,63
02,
210
5,48
02,
320
6,70
02,
280
8,05
02,
330
9,13
02,
400
13,0
002,
500
12,2
502,
500
10,7
402,
300
10,8
702,
300
13,4
002,
400
14,2
002,
500
16,0
002,
700
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Local
Export
2010
$32B
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ISRAEL ELECTRONICS & INFORMATION INDUSTRIES2006 - 18,700 M$ISRAEL ELECTRONICS & INFORMATION INDUSTRIES2006 - 18,700 M$
Civilian Comm. & Telecomm.
Components
IndustrialEquipment
22.9%
13.4%17.8%
13.4%
DefenseSystems
23.7%Software
8.8%
MedicalSystems
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Fiberoptic & Photonic Systems SDH, SONET Access – XDSL, IAD ATM, Frame Relay IP Networks – Voice, Video, Data, Multimedia Routers, Load balancing Test Equipment, Quality Monitoring of Networks 3G Applications Home Networks Storage Area Networks Wireless Local Loop, Microwave VPN, Firewalls Video-Compression, Video-Conferencing & Video Networks
TELECOMMUNICATIONS EQUIPMENTTELECOMMUNICATIONS EQUIPMENT
23%
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Missiles and Guided Weapons Anti Aircraft and Anti-Missiles Systems Radars - Airborne, Naval, Ground EW Equipment Fire Control Systems Command, Control, Communications and Intelligence Systems Avionic Equipment Platforms (Aircraft, Tanks…) Retrofit and Upgrading Navigation and Positioning Equipment Tactical Airborne, Naval and Ground Communications Sights and Night Vision Simulation and Training Equipment
MAJOR MILITARY SYSTEMSMAJOR MILITARY SYSTEMS
13.7%
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Computerized Production Equipment
Computerized Control Systems
Test Equipment
Training and Education Systems
Consumer Products
Security Equipment
MAJOR INDUSTRIAL EQUIPMENTMAJOR INDUSTRIAL EQUIPMENT
13..4%
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Imaging and Diagnostic Equipment
Surgical and Treatment Equipment
Monitoring Systems
MAJOR MEDICAL EQUIPMENTMAJOR MEDICAL EQUIPMENT
8,8%
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SEMICONDUCTORS Design Centers Manufacturing Facilities PASSIVE COMPONENTS Resistors & Networks Capacitors Transformers Batteries P.C. Boards ACTIVE COMPONENTS Tubes Power Supplies Oscillators Detectors Microelectronic Components Microwave Components
ELECTRONIC COMPONENTSELECTRONIC COMPONENTS
13,4 %
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INTERNET
MULTIMEDIA
SOFTWARE – PRODUCTS
SOFTWARE – TURNKEY PROJECTS
SOFTWARE - SUBCONTRACTING
SOFTWARESOFTWARE
23.7%
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ISRAEL ELECTRONICS & INFORMATION INDUSTRIES 2006 - 18,700 M$ISRAEL ELECTRONICS & INFORMATION INDUSTRIES 2006 - 18,700 M$
36%
USA
39%
5% 20%
EUROPE
ROW
ASIA
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Technology adoption curve
Faster and faster adoption curve
Sources: IEC Resources, Gartner, NetRatings, Scarborough Group
Number of years
US percentageof ownership Telephone
Electricity
Radio
PC
TV
Cell Phone
Internet
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Digital Hot Dog
Yes ! Everything is Digital
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The Broadband Revolution
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Business Week Oct 11 2004
* Total annual new bachelor’s degree or higher
Israel R&D in first place with 4.7% of GDP
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Scientists & Engineers per 10,000 pp
0
20
40
60
80
100
120
140
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Israel Israel Macro Economic Indicators 2005-2015Macro Economic Indicators 2005-20152005 20152005201520052015
100% 123.5 B
32610%
2228,9%
5245.5%23B
38%34.315.5%17,5
12%
=
Advanced Technology
100% 221 B
100% 3,2 M
100% 2,5 M
100% 115 B
100% 60 B
$ $
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$11B
2003
2003
$2,7T
$5,4T
2010
2010
We have the human resources necessary
$32B
2003 2010
X2
X2 ??
The new challenge to 2010
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The Israel Telecom Industry
Telecom Equipment
from A to Z
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Access
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Datacom/IT
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Metro & Backbone
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Cellular Core Network
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Cellular Handheld
Components
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Cellular Internet Applications
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CellularApplications
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HIGHER EDUCATION IN ISRAELELECTRICAL & COMPUTER ENGINEERING & COMPUTER SCIENCES
Academic Year
Number of 1st Year Students
Number of Graduates
% of Universities1
st Year Students
% of Colleges 1st Year Students
until 1994
1,200
1,000
100%
0%
1998
4,860
2,280
73%
27%
1999
5,800
2,500
62%
38%
2000
6,653
4,040
54%
46%
2001
8,030
4,300
45%
55%
2004++ 8000 5,200 46% 54%
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Foreign Investements in Israel
2006
Expected to reach $20Bn
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Foreign investment growth Foreign investment growth
Foreign investment $BnForeign investment $Bn
*Jan-Sep 2006 at annual rate
7.2
1.4 1.4
6.3 6.0 7.0
5.1
1.83.9
1.8
5.6
9.4
0.5
3.6
0
2
4
6
8
10
12
14
16
18
2000 2001 2002 2003 2004 2005 Jan-Oct2006
direct others
4.9
2006 Q32006 Q32006 Q32006 Q3
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Acquired CompanyAcquiring CompanyMonthTransaction in $MPayment
Iskar
Lipman
Passave
Kashya
Identify
Sightline
Alma
Predix
Whale
Med Impuls
Eldat
Aduba
Mercury
M-Systems*
XOsoft
nLayers
Mobilitec
Gteko
XMPie
PowerDesign *
Brekshier (Warren Buffett)
VeriFone
PMC
EMC
BMC
Striker
Investment fund TA
EPIX
Microsoft
AMS
Pricer
Sun Microsystems
HP
SanDisk
CA
EMC
Lucent
Microsoft
Xerox
Microsemi
May
April
April
May
March
March
March
April
May
January
April
February
July
July
July
June
September
October
Oct
4,000
793
300
153
150
140
90
90
76
50
40
12.8
75
100
54
245M
Cash
Cash + Stock
Stock
Cash
Cash
Cash
Cash
Cash + Stock
Cash
Cash
Stock
Cash
Terms of transaction not disclosed
Financial terms of transaction are not being disclosed
Cash
Cash + Stock
Foreign Investment in Israel in 2006
2006 total $12Bn* Not Final
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Foreign Investment in Israel 20064,000$M
800$M
300$M
150$M
150$M
140$M
90$M
4,500$M
1,500$M
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Foreign Investment in Israel 2006
90$M
76$M
Med Impuls50$M
40$M
12$M
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245$M
54$M
100$M
75$M
Foreign Investment in Israel 2006
50$M
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FOREIGN ELECTRONIC SUBSIDIARIESIN ISRAEL (PARTIAL LIST)
FOREIGN ELECTRONIC SUBSIDIARIESIN ISRAEL (PARTIAL LIST)
Intel Microsoft IBM Sun Microsystems Cisco 3 Com HP Texas Instruments National S.C ST Microelectronics Infineon Analog Devices Vishay AVX (Kyocera) General Electric Philips Medical
Motorola Lucent Technologies Avaya Nortel Siemens Alcatel Philips Ericsson Nokia ADC Qualcomm Applied Materials KLA - Tencor Kulicke & Soffa BAE Systems Ind. Astronautics
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Asked how come he chose Israel as his first investment outside America, Buffett's response was: "Some Americans came looking for oil, so they didn't
stop in Israel. We came looking for brains, so we did stop in Israel."
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CEO Ed Zander visit to Israel• -----Original Message-----
From: Zander Ed-AEZ111 Sent: Sunday, November 14, 2004 10:57 PMTo: Yanay Elisha-BCMS54; Nottenburg Richard-arn021Cc: Brown Greg-CGB025Subject: RE: Your visit to Israel
Elisha- I had a great time. You and your team did an outstanding job. I was continually impressed by their knowledge of the business, opportunities and issues and great work ethic. Motorola has a jewel in it it's Israeli operation thanks to you and your senior team. Hope to see you soon. Regards, ed
• ed@motorola.com 847-576-3000
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Bill Gates, the Microsoft CEO, made his first trek to Israel
“Considering the density of Israeli start-ups and local successes, Israel is like a bit of Silicon Valley.
4140
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What do we need to continue our success?
• Excel in our education – aspire to being the best in the world
• Keep raising the bar in education• Teach innovation and creativity• Strengthen partnerships between academia and industry• Support sophisticated, small ( 20-50 $M) industries – if
you want to be large, gather together many small…• Government support should match or even exceed other
countries’ incentive plans• Keep pushing!
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• Great talent driving Israel ’s success
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