- 14 January 2010 11:32
Beyond Visual Range – IDC’s 2010 Australian IT Services Predictions
Sydney, Australia, 14 January 2010. IDC has announced its top ten predictions for the Australian IT Services market in 2010. As the Australian economy is forecast to grow at a 3.5% rate, IDC predicts an increase in outsourcing projects stemming from cloud computing, which has emerged from a mere catchphrase to be IT's prodigal son.
“Cloud computing represents a new dawn in enterprise computing and business leaders are beginning to ready their companies for the big changes that lie ahead,” said Matthew Oostveen, IDC research manager and analyst. “Facilitating this change will be services organisations from consultants to systems integrators.”
IDC predicts a stark increase in the uptake of services originating from server virtualisation and datacentre optimisation as organisations look to both consolidate their infrastructure and reduce the operational expenditure.
“Australians are a tech savvy bunch so it stands to reason that Australia has the leading uptake of server virtualisation in the Asia Pacific region, which has lead to a large installed base of virtualised servers with high levels of services attached,” notes Oostveen.
At the end of a tumultuous year noteworthy for the rise of disruptive technologies and strained economic conditions IDC presents the following predictions for the 2010 Australian services sector,
1. The economy driving the market The need to contain costs in 2010 will continue to drive the outsourcing and hosting services market in 2010. IDC believes that Australia is still emerging from the downturn, however, there are positive indicators that an early recovery may ensue. The overall services market will benefit both from cost reduction and operational efficiency measures generated by the difficult economic climate in 2009 and the slow recovery expected in 2010.
2. Positive view on cloud computing In time, 2009 will be remembered as the year the cloud was seeded. Benefits such as rapid deployment, pay-per-use pricing models and the latest functionality have roused interest in the concept beyond IT. As this interest filters though organisations, IDC expects more announcements of contract wins in 2010, which would greatly benefit the system integration community.
3. Server virtualisation services will skyrocket IDC believes that virtualisation services in Australia will see significant growth in 2010 owing to the growth in the SMB space. Additionally, key vendors of the technology are expected to lock horns in their bid to win over the SMB market. Governments and enterprises will see a shift from consolidation to more sophisticated usage such as charge-back pricing models.
4. Datacentre optimisation services to be a growth area The Gershon Review recommended de-duplication of datacentres and IDC believes this recommendation is a reflection of Australian IT in general. Business and multiple levels of government running multiple datacentres will consolidate sites spurring growth in optimisation services.
5. Telcos enhancing their hosted applications and infrastructure plays pushes them deeper into IT and the Cloud IDC expects telecommunications companies to play a significant role in modern IT following huge investments in datacentre assets blurring the line between IT and telecommunication companies. The investment in data-intensive, value added services is amplified when leveraged with the ownership of the core network and expertise in outsourcing services.
6. Managed security services takes on convergence, virtualisation and cloud With Cloud security viewed by CIOs as the greatest obstacle to adoption, IDC sees Cloud security as an increasingly important factor in the security space which will benefit services providers offering integration, consulting and implementation services. At forefront of security services moving into the cloud is DOS (Denial Of Service) defense, Deep Packet Inspection (DPI), network security, messaging security and web security.
7. Web 2.0 to re-engineer customer care The change in how we consume technology and the rise of web 2.0 has greatly influenced how organisations and individuals approach customer care, with younger generations preferring social networking as a means of a support mechanism in terms of soliciting answers or providing feedback.
From a bigger picture perspective, IDC has already seen how social media will also spur a lot of services in policy, governance, security, consulting and integration for enterprises' own employees to take advantages of running a 'social enterprise' and using social media to reach out to its customers.
8. Cost cutting will force innovations in IT strategy in manufacturing At a time when trade is decreasing faster than production, and industrial output has dropped in the past year, manufacturers and their trading partners are earnestly seeking all available means to cut costs and improve efficiency.
IDC forecasts that total ICT spending in Manufacturing in Australia will grow from A$4,856 million in 2010 to A$5,612.5 million in 2013 - achieving a strong CAGR of 4.9% for the three-year period. IT Services will account for 21.1% of this spending in 2010.
9. NBN to drive project oriented and consulting work in 2010 The Australian Government's ambitious NBN project will provide a shot in the arm for project management, with majority of projects seen in system integration, network consulting and IT consulting.
In the coming years, many B2C (business to consumer) entities will be thinking about content and application delivery to the consumer to enhance their competitive positioning. IDC expects some interesting pilot and case studies from health, education, gaming and media/entertainment sectors, working in partnership with technology vendors.
10. 2010 will see more business outcome types of services engagements IDC believes that 2010 will see vendors make the shift in changing the measurement metric from IT outcomes (based on SLAs such as availability, response times, etc) to business outcomes that directly impact the top or bottom line.
In light of the increased role of the COO and the CFO and in some cases the CEO in the purchasing process, vendors that focus on structuring contracts that incorporate business metrics will drive competitive advantage for themselves in 2010.
For further information or to request an analyst briefing on this topic, please contact Sally Taylor-Phillips, Marketing Communications Manager at IDC on +61 2 9925 2234 or e-mail firstname.lastname@example.org.
About IDC IDC is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. More than 1000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends covering over 110 countries worldwide. For more than 45 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com or www.idc.com.au.