High-tech journalist types are known for spouting off predictions and prognostications at the end or beginning of each year. Since I still do this routinely for SearchITChannel, I figured it would be appropriate for me to revisit what I reported 12 months ago in our story, “Four trends that will shape IT services in 2012.”
For a quick recap, here are the four themes that emerged:
- Bring your own device movement (BYOD)
- Mobile app stores
- Data management 2.0
- The cloud
So how did we do? Continued »
In early November, I wrote about the need for technology solution providers to think more creatively about how to find the budgets for technology services or projects they are pitching. The point being that this money doesn’t always have to come out of a company’s IT budget.
But even though a VAR’s business-side connections will be much more important in the future for winning business within small and midsize businesses, there are still plenty of reasons to make nice with the IT departments within prospective or existing accounts. And to do so at least once per quarter (as you’ll read in a moment).
It seems to me that many small-business owners are perpetually pessimistic right now, so I tend not to report on many of the surveys sent my way about their spending and hiring plans.
Still, I think technology solution providers should peek at a new Gallup poll about small-business capital spending intentions for the next 12 months. If nothing else, the data is a great reminder of why the technology channel needs to continue investing in viable business models for managed services and cloud-delivered IT services.
Are there any fans of Extreme Makeover: Home Edition out there? If so, keep an eye out for Avnet employees on Monday night’s show. Eighteen members of the company’s IBM Solutions group spent two Saturdays in San Antonio, Texas, planting sod, moving rocks, cleaning up construction debris and directing traffic. Avnet also donated three MacBooks and other components of a home tech system.
Technology solution providers representing the Microsoft Office 365 cloud applications suite for small businesses should take note of a huge change in the competitive landscape.
This week, Microsoft rival Google stopped offering a free version of its Google Apps for small businesses, saying that new customers will need to opt for the Premium edition, which costs $50 per user per year. Features of that service include 24/7 phone support, a 25-gigabyte inbox and a 99.9 percent uptime guarantee.
The changes means Microsoft partners will be able to discuss the two services on a more level playing field.
Within four weeks of its launch, Windows 7 managed to capture 83 percent of Windows device hardware sales in the retail channel. But Windows 8 has so far fallen short of that market: it accounted for about 58 percent of Windows sales within the same timeframe, reports NPD Group.
That finding comes from the research firm’s weekly tracking service.
Software as a service (SaaS) is moving beyond early enthusiasts deeper into enterprise accounts but adoption rates differ dramatically depending on the region, reports Gartner.
The research firm’s latest survey of SaaS trends shows that 71 percent of the businesses now using applications delivered as a service have been doing so for less than three years, which signals wider mainstream adoption, according to Gartner’s report, “Survey Analysis: Buyers Tell Us About SaaS and Cloud Adoption Through 2014.”
The latest America Recycles Day came and went this week, with the requisite flood of press releases about electronic waste (aka e-waste) flooding my email inbox.
That’s because the high-tech industry continues to churn through and discard a troubling amount of gadgets — especially (as you might expect) mobile stuff like cell phones. The United States alone sends roughly 135 million of them to landfills every year.
That’s a number that companies like Sprint are determined to reduce: the company now collects about 40 percent of the devices it sells or distributes at the end of their life (about 11 million gadgets last year). It is striving to increase that rate up to 9 out of every 10 devices by 2017.
What about the bigger stuff? Many of the biggest high-tech companies including Dell, Hewlett-Packard and IBM have established collection programs to facilitate take back of servers, personal computers, monitors and other accessories. It’s a big push for the leasing arms of all these companies.
Channel partners and systems integrators have been much more quiet about the issue, but that may be changing.
Global IT services giant Dimension Data this week launched an expansive e-waste collection service that is part of its broader technology asset management portfolio. It figures that more than 60 million tons of e-waste will be considered for reuse or recycling in 2013, and it believes it has an opportunity to help its clients asses the best options for those items.
“Expanding our technology lifecycle management assessment to include an e-waste solution means our expert advice doesn’t start at the point of disposal,” said Colin Curtis, the company’s director of sustainability, in a statement about the new service. “We can now assess the strength of each item in a technology base, determine its point in the lifecycle, and then use best practices to dispose of elapsed devices and equipment in an ecological and regulatory-compliant manner. In addition, the organization’s security and brand are not negatively impacted.”
That last point is something that can’t be emphasized enough.
There is one big reason that businesses are paying more attention to e-waste: compliance.
That’s because ignoring the proper disposal of IT equipment means a company could become liable for sending toxic substances to a landfill, not to mention the data privacy implications.
As the technology consolidation movement continues and upgrades start to happen throughout 2013, this will only become more of a pressing issue – one that your services team must be ready to discuss.
The latest prognostication about public cloud computing from IDC calls for a compound annual growth rate (CAGR) of 18.5 percent between now and 2016 – with$43.2 billion in revenue anticipated by the end of the forecast period. (That compares with $18.5 billion in 2011.)
This forecast doesn’t include private cloud infrastructure or hybrid cloud integration work; it only covers services that are “shared among unrelated enterprises and consumers, open for a largely unrestricted universe of potential users, and designed for a market, not a single enterprise.”
The three biggest verticals for public cloud services right now are discrete manufacturing, professional services and process manufacturing, according to IDC’s report, “U.S. Public IT Cloud Service by Industry Sector.”
Indeed, professional services alone accounted for nearly 40 percent of all public cloud services in spending during 2011, according to the data.
The verticals that will grow fastest, however, moving forward are communications and media, education and construction.
Infrastructure as a service (IaaS) is the most active segment of the public cloud services world right now, accounting for 12.3 percent in 2011. By 2012, it will still account for 12.9 percent of spending, according to IDC’s projections.
For years, I have been watching all sorts of research predictions about IT spending plans. But for the past three or four years, I have put less credence in them.
That’s mainly because I feel that focusing strictly on what businesses are saying they intend to spend for hardware or software or networking gear over a given time period under-represents what they are actually willing to pay for a solution to a business problem – a solution that happens to be based on technology.
In my mind, there are quite a few businesses — at least the ones that are thinking about the future — that are willing to spend more on technology than their actual IT budget suggests, if that technology helps address a specific business need.
So, instead of trying to figure out the size of a given company’s technology line item and how much of it they can claim, solution providers should be thinking about what portion of each business process is dependent on technology. And on helping the business decision-maker in charge of that process find the money to improve it.
This really isn’t a new concept for the IT solution providers of this world that spend their time really consulting with their clients about their plans and that take the time to figure out what is motivating them.
What’s different right now is the fact that the services are now in place that make it simpler for businesses to make those decisions and to act without having to wait in line for an internal IT department.
Research firm Gartner calls this “The Nexus” – a convergence of social, mobility, cloud infrastructure and information management trends that are “digitizing” different segments of their business.
Marketing is a great example of a business function that is being completely transformed by these things. Historically speaking, the marketing function may not have requested many of its own applications (or been allocated all that much). But now, a much larger portion of what marketing teams spend is being dedicated to all sorts of new cloud services tied to the social media world.
Gartner figures that in the past, about 20 percent of all technology spending was outside the domain of the IT department. By the end of this decade, it will account for 90 percent, the research firm predicts.
“The Chief Digital Officer will prove to be the most exciting strategic role in the decade ahead, and IT leaders have the opportunity to be the leaders who will define it,” said David Willis, vice president and distinguished analyst for Gartner. “The Chief Digital Officer plays in the place where the enterprise meets the customer, where the revenue is generated and the mission accomplished. They’re in charge of the digital business strategy. That’s a long way from running back-office IT, and it’s full of opportunity.”
In just three years, one-quarter of all companies will have a Chief Digital Officer, Willis believes.
That will create even more fragmentation — and opportunity — when it comes to helping companies manage those digital services in the context of the larger picture. Security, in particular, will play a critical role. In fact, Gartner forecasts a 56 percent increase in overall spending on security solutions, while usage of cloud security services “will almost triple.”
Whether or not you believe those numbers, the shift that is going on is very real. The existence of cloud services – which may or may not have to be approved by an IT contact before they show up on a credit card or invoice – is completely rewriting the rules of engagement for solution providers.
You can choose to lament that fact or use this as an opportunity to dig deeper into organizations to find the right decision-makers, who may be willing to spend more than the IT budget spending data suggests.