ICT Predictions 2012

ICT Predictions 2012

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  The ICT Researchand Consulting world is changing fast. Clients require more for less, demand quality services and are not prepared to pay premiums for brand recognition. Traditional ICT research firms have contributed significant value in the past, but now market is fragmenting, a new wave of “boutiques” are sprouting and many smart analysts are now working as independent professionals. By operating across Management Consulting, Advisory Services, Events and Marketing Services, we are today facing a new breed of independent ”Market Makers”. They are often well known in an industry that appreciates the intellectual freedom, original approach and independent judgment of these new influencers who are in a condition to provide quality services at lower prices without being encumbered by the high cost structures of the traditional firms. On the other hand these new players prize a lot the intellectual and professional freedom that this new status enables them to enjoy, as the Web and the Social Networks make their geographical location totally irrelevant. So we believe there are all the conditions to enable the ICT Community to benefit from this new network of competences, and these new “Market Makers” to take advantage of the wider market potential, of the additional business opportunities, and of the flexible set of complementary skills that an extensive virtual network are opening up for them. The Predictions 2012 is a “catalyst” event to enable the process of building of a virtual “ICT Research Network “. This is why a number of independent ICT Analyst and “Boutiques” have agreed to launch a first “Crowd-forecasting” exercise, that now results in this first set of “ ICT Predictions 2012”. We believe that these “Predictions” provide an original view of some of the relevant trends that are characterizing the ICT world, with a particular focus on Europe. Perhaps the final output is still a bit heterogeneous, but it will improve over time. We trust that the ICT Industry and market will find this first step of our still embryonic “ICT Research Network” interesting and valuable. Contributors The following independent analysts and firms have contributed to this document: 1. Pim Bilderbeek, The METISfiles, Amsterdam. e:pim@themetisfiles.nl 2. Jaime Garcia Cantero, Madrid. e:[email protected] 3. Claus Egge, clausegge.com, London. e:[email protected] 4. Martin Hingley, ITCandor, London. e:[email protected] 5. Simona Macellari, The Innovation Group, Milan. [email protected] 6. Roberto Masiero, The Innovation Group, Milan. [email protected] 7. Puni Rajah, The Governance Board, London. [email protected] 8. Peter Perregaard, Copenhagen. [email protected] 9. Carsten Schmidt, HENRY Corporation, Copenhagen. [email protected] 10. Ezio Viola, The Innovation Group, Milan. [email protected] © The ICT Research Network Page 1 of 6
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  On 1st January2012, Denmark takes over presidential responsibility at an unprecedented time of turmoil for Europe’s economies. It will be hard to run away from the reality of economies, the impact on citizens and necessary policies. The Euro Crunch bites ICT sales in EMEA by Martin Hingley Our industry tends in general to grow faster than GDP, due to automation and digitisation: however ITC sales can fall even faster than GDP in times of recession. We saw falls in both 2001-3 and 2008-9 downturns and you should expect the same in 2012. Economic news has been dire in 2011 as countries struggle with sovereign debt – especially in southern ones using the Euro. Of course we’ve also seen civil unrest and political change in North Africa and parts of the Middle East, as well as the introduction of severe austerity budgets by governments all over –resulting in lower employment in the Public Sector. On the positive side there are signs of modernisation in many African states, with vendors building new offices in the hope of winning early business. We will also see new business from disrupted countries stabilising and becoming more democratic. Business spending is likely to be less affected than in 2008, largely because there can be few surprises likely to result in a sudden loss of confidence. Consumer spending, on the other hand, will not be countervailing as it was in 2008 – the reduction in household budgets are too palpable. Causes, effects and vicious cycles by Roberto Masiero The recession and the economic measures taken to address the financial problems of countries on the verge of default will heavily impact the ICT market, that will decrease more than proportionally in comparison with GDP in the affected Countries. As a result the "digital divide" in Europe between the Northern Countries and the Southern and Mediterranean ones will significantly widen, which will trigger a vicious circle between GDP-ICT market negative trends in Southern Europe that will characterize the next few years Demographic dividend by Simona Macellari In the more developed countries, especially in Europe, we are facing the perfect storm for massive ICT investments to tackle the ageing problem: skyrocketing costs, chronicle diseases and rising need to longer work and social life of senior citizen. Governmental and economic changes will accelerate the shift to technology and innovation to organically support, beyond the pilot stage of the several fragmentized initiatives in place, elders needs and expectation. This extremely positive ICT spending pattern will continue to have and effect in the next years. © The ICT Research Network Page 2 of 6
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  Embracing deflation byEzio Viola In 2012 tight capital budgets, credit restrictions and debt crisis will force companies to increase productivity and take lower risks. But a strategy of pure survival will not be good enough. An effective business transformation should be based on solid pillars: consumerization of IT, mobile-cloud-social technologies, and advanced analytics. These new digital pillars are game changer and the foundation for innovating business models and transform processes. Business  & IT Management needs to become smarter and use the actual crisis as a trigger to start this process. To “do more with less” and pursue a pure efficient model with IT will not be good enough anymore.   “Do right with less” should be the foundation of a new IT- Business strategic alignment process for smart companies to win in the coming recession. This process is based on a threefold direction: • Selection and focus of the right core key strategic capabilities, assets and process  • Building a portfolio of strategic short and medium term initiatives with the above digital pillars that can provide returns with a less cumbersome investment model • Drastically eliminate inefficiency adopting new sourcing models based on a sound cloud strategy. Enterprise customers settle into the post PC era by Jaime Garcia Cantero When asked about the future of personal computers, deceased Apple´s Founder and President Steve Jobs used to say: “Trucks haven´t disappeared but not everybody needs one”. Jobs seems to be right, once more. In 2011 by first time in history people accessing the Internet from a “non PC” device (tablets, smartphones, TV, etc.) overpassed those accessing from PCs but this is just the beginning of a major change in ICT Industry. A Third wave in IT after mainframe era, and pc era is here to stay. Technology is more transparent and easy to use than ever and information is full accessible for anybody, anywhere and anytime. In 2012 we´ll continue seeing strong growth in mobile markets like apps, mobile media, advertisement or gaming. Organisational intelligence is the new holy grail by Roberto Masiero The winners of the Post-PC age will be those "New Intelligent Enterprises" that will be able to: - Re-think their business in terms of mobile services - Understand in depth and predict the behavior of their customers through an advanced use of the analytics © The ICT Research Network Page 3 of 6
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  - Take advantageof the Social Networks as new economic organizations, that have brought the traditional monopoly of the enterprises in the production of value to an end -... and deliver their services in the Cloud. SOE ( Service Oriented Everything) Mandate by Jaime Garcia Cantero After Years talking on SOA, organizations of all size and vertical are making enormous efforts in orienting not just architecture but any single area of IT to a service model  avoiding CAPEX or converting it into OPEX. In current economic conditions organizations don´t want to invest in actives but paying for services. Different sourcing strategies, cloud services, pay as you go models or even virtualization can be considered part of this bigger trend till managing IT as a service. In these circumstances CIO role is redefined as a services broker responsible for guarantying service level at best Price in any moment. Maintenance gets new respect by Puni Rajah For many years now, enterprise customers have been questioning the bill they face with regard to hardware and software maintenance. The rise of third party maintenance providers has mitigated some of these concerns, but there is still a long way to go. Vendor maintenance fees will now be questioned more ferociously as all-inclusive cloud options bring fresh attention to value for money.  At the same time, peer level access to specialists on social platforms has created new expectations around resolution speed and quality, putting pressure on vendors' internal escalation processes.  Data analytics for the pioneers in 2012 by Claus Egge In 2012 data analytics will grow as business & IT jointly pursue a common purpose. Data warehouses once gave businesses the ability to mine their database content, but the vast estate of storage promised more. New techniques in joining together unstructured data of numerous sources located in repositories across the web is better described as analytics than big data. Analytics gives the data pioneers the tools to find more value in information, but in 2012 they are just that: pioneers. The market will however grow because the practice will eventually become widely adopted. First adopters are found in verticals that are information centric or need first mover advantage. Sourcing matures towards outcomes by Puni Rajah We saw offshoring, then nearshoring and now homeshoring. The industry embraced outsourcing, and now is experiencing some insourcing. Data jurisdiction issues arising from cloud computing has highlighted location concerns. Expect procurement professionals to be more sensitive to exit strategies, (anticipatory) regulatory compliance and favour local solutions. 
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  As HR policiesmature to cover all these possibilities, in 2012 we will also see greater emphasis on outcomes rather then methods. Much of this stems from better use of collaborative technologies including video conferencing. Local strength by Ezio Viola Global players like IBM, SAP, and Oracle are using acquisition strategies for innovation in order to grow the top line, to remain relevant and to grow in the mobile, cloud, and social software and it-services markets; a war for footprint and users is in place. The global market can expect more consolidation and more chaos as such acquisitions change the overall market landscape. The bottom line is that also for the local ICT companies the cloud does change many dynamics for all the existing players. • Hardware and TLC vendors will emerge as cloud providers; bundled services will be supplied more and more by trusted hardware and telecommunications providers. • System integrators will move to the cloud to provide differentiated Intellectual Properties and Cloud BPO with bundled services under a single SLA and contract. • Full stack providers and new cloud brokers models are moving to create value for both the IT buyers and the business line executives. The next 12 to 18 months will show how innovation created by new local ICT companies will act as pathfinders vs. existing legacy vendors. The model is no different than in hardware and software 25 years ago when the PC started to build its ecosystem. However, in the post-PC era, new innovators and entrants will continue to emerge due to the low barrier of entry and the attractive returns. Apple will lose it's dominant position in the smart phone market by Peter Perregaard While Apple was eminent in understanding that people wanted a device that extended their personality rather than just technology, the economic situation in the industrialized world and the growth in developing countries means that there will be much more focus on price. This will give Nokia, Samsung and others a chance to re-define their position in the smart phone marked and take share from Apple. This will lead to an explosion of new companies that will develop Apps to more platforms trying to capitalize on the explosion of devices on Windows and Android. And applications will become more "business-like" as more users buy for economic reasons rather than social. © The ICT Research Network Page 5 of 6
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  Anti-trust actions loomlarge by Peter Perregaard Facebook will be everywhere. When you shop, when you log-on, when you socialize, when you sell stuff, when you are alone and when you are with others, when you communicate, when you are bored  - everywhere... The position will be so dominant that it will become a competitive problem. Regulators will therefore begin to look into business practices of Facebook to make sure that competitors have a chance to use data from Facebook in their own offerings  -  giving new hubs a chance to build smaller, more focused networks without loosing the benefit of the large network. However, Digital Divide Persists by Pim Bilderbeek In 2012, European governments will become increasingly out of touch with digital society and disconnected from the general public. Most governments will fail to implement cloud services, perhaps for budgetary reasons, perhaps for political reasons, perhaps out of fear. As a result governments will be inefficient and digital services for citizens will remain scarce. This is all the more problematic because citizens and business have embraced digital commerce and social networking. The threat of a digital divide keeps looming over Europe, as The Netherlands is the only European country where parliament embraced Net Neutrality and banned mobile telephone operators from blocking or charging consumers extra for using Internet-based communications services like Skype or WhatsApp. Concern about the reliability of online services will remain and Internet outages will occur and will get disproportional attention from the press. Consumers and businesses alike will increasingly be hit with security and privacy issues. Despite the disconnected government, Europe will become increasingly dependent on the 100% uptime of critical digital functions like telecommunications, Internet, mobile networks, computing power, and access to data. Governments will need to ensure that critical digital functions will be available to citizens, government, businesses and other entities that must have access to those functions. Digital society continuity management will become an important new discipline that governments will need to master.