As the Christmas bells ring out and herald the end of 2011, the stage is already being set for 2012. The 1,000-year-old Mayan calendar famously ends in 2012; apocalyptic warnings have been readily apparent among the more superstitious. The channel, though, may prefer to take heed of analyst giant IDC, which this month released its predictions for the IT industry in the coming year.
And it is not just more doom-mongering. The trends and issues expected across the industry, the analyst firm indicates, will largely be a natural progression, in many ways, of what the industry has experienced over the past few years.
Frank Gens, senior vice president and chief analyst at IDC, says the year ahead will most likely be rather tough. But savvy players will still carve out a niche for themselves in areas of strong and ongoing potential.
"These predictions lay out the themes and opportunities that we will get and the direction of the industry in 2012 and beyond," he says. "We made our top 10 list of predictions based around high growth, industry-wide impact and disruption. It was a global brainstorm of some 1,000 analysts."
Focus on emerging markets
Perhaps most worryingly for the UK and the rest of the ‘developed' world, IDC predicts that at least 53 per cent of IT spending growth in 2012 will be in emerging markets such as China and Brazil. Emerging markets will account for 28 per cent of global IT spending overall in 2012, Gens says.
"But Europe's debt crisis and the unravelling of the euro could take world IT growth down to two per cent or less," he adds. Increasingly, products and vendors from emerging markets will compete in developed markets as well.
Gens notes that 2012's IT spend globally will see 14 per cent expansion over that in 2011, and up to 80 per cent of IT sales growth will by 2020 come from what IDC calls third-platform technologies such as cloud services.
Third-platform technology refers to solutions with core ingredients such as mobile devices and apps that go beyond the PC. This may include where cloud services replace the traditional client/server computing model, and mobile broadband such as 4G that "connects the edge to the core".
Creating value on the third platform
"Two important technologies are creating value on top of this foundation: ‘big data' analytics and social technologies," IDC said in a September announcement.
Gens confirms that data and analytics mash-ups will accelerate in 2012. These could be around in-memory databases and BI tools, analytics functionality into the database, or analytics appliances.
Emerging markets will drive mobile device price points way down in 2012, but the explosion in mobile apps will continue, with the iOS and Android platforms increasingly likely to fight to the death.
Android's momentum in the market will increase, Gens predicts.
"It will also be a make-or-break year for Microsoft, RIM and HP: Windows 8, Blackberry needs to succeed and HP re-enters the market," says Gens, adding that Microsoft will need to access some Netflix-like media cloud to stay abreast of the changes.
"In 2012, cloud services spending will exceed $36bn, growing at quadruple the industry rate. Amazon will join the $1bn IT vendor club, and application platform/Platform-as-a-Service wars will intensify between Amazon, Google, IBM, Microsoft, Oracle, Salesforce.com, VMware and others," Gens says.
Cloud competition intensifies
More than 80 per cent of new apps will be aimed at the cloud, and 2.5 per cent of legacy packages will migrate into the cloud – many more than in 2011.
"Customers want the ability to port these apps on to public cloud infrastructure," Gens confirms. "And there will be a SaaS app buying spree in 2012."
Cloud brokers, enablers or other "arms dealers" will flourish in such a climate, especially as the emphasis moves away from self-built systems, he suggests. Spending on hardware, software and services that in any way enables cloud will also look healthy – perhaps tipping a 30 per cent growth rate year on year to reach $23bn worldwide.
Telcos will move their cloud strategies up a gear, dealing increasingly in solutions, app stores and platforms themselves, Gens says. There will be more video traffic, and more focus on WAN optimisation and systems management.
IDC believes that the so-called internet of things – embedded systems, entertainment devices, machine-to-machine communication – will outnumber traditional IT devices by the end of 2013. Meanwhile, Twitter-like microblogging software will enable people to 'follow' objects and services rather than people. This would prove vastly beneficial to many organisations, Gens suggests.
"For example, following a connected application at home, or [a site that keeps updating with] the best parking location, or that gives the exact travel time," he says. "Think of it as ‘Twitter for your toaster'."
Retail competition will heat up as in-store offer management mobile apps are invented and proliferate, with bricks-and-mortar outlets using them to fight the tendency of customers today to browse the real store, then buy online from home at another outlet entirely.
Intelligent vertical solutions
Intelligent industry solutions will be a top 10 theme for 2012 and beyond. This also includes adoption of social media for uses that move beyond marketing, even for financial services firms, and some $40bn of investments globally into ‘smart cities' projects, especially around energy, government and healthcare, says Gens.
"Essentially, 2012 will be like 2011, and yet it will be different in many ways. Mobile devices will have finally won; cloud platform battles will be in full force. Social technologies will be a must-have, and big data the next essential capability," he concludes. "Vertical competency will be at the core of next-generation solutions, and emerging markets are the centre of growth.
"Vendors that still don't have a strong presence in these markets are really doomed. Many IT vendors are at a strategic crossroads."
IDC contextualised its 2012 predictions against what the industry is likely to be like even further into the future – in 2020 – with a view to helping companies prepare. Gens said that a team of some 50 IDC analysts around the globe produced the predictions summary for 2012, collaborating with hundreds of other IDC colleagues.
See CRN in the new year for a view from the channel of what to expect in 2012.
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