Competition to heat up in 'pivotal' 2005
Analyst predicts 'disruptions to the status quo'
Competition in the IT industry will be ?brutal? in 2005, according to a leading IDC analyst.
Speaking at last week's Regent Conference in London, John Gantz, chief research officer at IDC, told a gathering of chief executives and industry leaders that although the IT slowdown is over, the coming year will witness "disruptions to the status quo" as new technologies emerge.
"This is the first year that we are beyond the big crash of 2000. The economy is as good as it has been, although we are seeing more general industry uncertainty, particularly with the falling value of the dollar," he said.
Gantz said the bright spots in the market are 'smart' hand-held devices such as PDAs, BlackBerrys and mobile phones. The PC market is facing increased price wars and the industry will witness "rock-bottom" prices, he added.
Convergence and voice over IP will also be boom areas. Emerging technologies will include mesh networks, alternative displays, plastic semiconductors and neural interfaces, Gantz said.
"We are going to see brutal competitive behaviour as consolidation increases. This is a pivotal year. If you can't make it in 2005, you should give up," he added.
Peter Rowell, executive chairman of market watcher Regent Associates, agreed that the market has moved on from infrastructure replacement.
"The next year will see growth in software and services focused on vertical applications," he said. "The government market will be strong in 2005, but next year financial services will be in the forefront."
Nora Denzel, senior vice-president software global business unit at Hewlett-Packard (HP), said only "agile" firms will survive. "We are big fans of Darwin at HP. Companies that don't adapt to change are the most likely not to make it," she said.