IDC predictions for 2010
ConvergenceAsia staff
15/12/2009

In its annual outlook for the year ahead, IDC predicts the Information and Communications Technology (ICT) spending and growth in Asia/Pacific excluding Japan (APEJ) will reach US$184 billion in 2010 with a 7.7 per cent growth over this year. IDC expects the lion's share to come from India and China, although all countries are expected to experience varying degrees of growth on the back of a dismal 2009.

"Whilst budgets are still tight, and the buying patterns may have changed irrevocably from what the ICT industry has been accustomed to, the fact remains that there is cautious optimism in the market with some interesting pockets of surprising growth," said Simon Piff, Head of Asia/Pacific Predictions Committee for 2010.

"The net result of the economic slowdown has been an overarching change in how and why companies make new technology investments. Most notably, the key areas of focus going forward will be in customer care, client retention and wallet-share growth enabling technologies.”

Additionally, IDC foresees projects that generate immediate ROI and tangible improvements in managerial and operational efficiencies will continue to be the projects that garner quick corporate ‘buy-in’, Simon continues.

At the same time, the areas that IDC believes will be key enabling technologies for 2010 are not necessarily new technologies as much as they are a more mature and robust implementation of technologies that have been available for a while already.

Cloud Computing, last year’s focus area, will move from being an amorphous buzz word to a more tactile reality as service providers come to grips with the challenges of providing public cloud and organisations realise the flexibility that implementing a cloud infrastructure internally can provide.

IDC’s annual predictions for the ICT markets in APEJ draw upon latest IDC research and a worldwide brainstorming exercise among IDC’s 1000+ analysts. This was followed by an extensive regional review to weigh in on key industry events, user trends, vendor strategies and economic measures that promises to uniquely define the technology trends which would impact and drive the ICT market in APEJ for 2010.

The following are the top 10 key IDC predictions that will shape the ICT industry in APEJ in 2010:

1. The maturing of cloud: SLA implications on service providers will improve and emerge
IDC believes that the combination of 5 nines guarantee plus a robust business continuity and disaster recovery (BCDR) capabilities will be the new "killer application" in cloud services. In 2010, large organisations that are ready to make that leap to cloud services will do so demanding the same SLAs with BCDR capabilities.

2. Business analytics for better business
In 2010, IDC expects business analytics to emerge as a key technology area to help CIOs manage cost, comply with regulations and, most importantly, grow the business as information is treated as a strategic asset within the organisation. More advanced and sophisticated forms of analytics solutions are actively being implemented by organisations in the region.

3. The tipping point: The inevitable adoption of social media in enterprises
2010 will be the year social media hits "critical mass" in terms of acceptance and adoption. IDC believes that this convergence of economic necessity, mature enabling technology such as business analytics tools, and increasing market awareness will mean that 2010 will be the year where social media truly gains traction and establishes itself as a natural and accepted tool for Asia companies, CIOs, and CMOs.

4. Converged fabric and the evolving data centre
IDC believes that converged fabric solutions significantly address some of the IT sprawl and the resulting large amount of expenditure on maintenance. Prevailing economic conditions have fuelled the hunger to pare cost in data centre management, and maintenance will be one of the most powerful motivators for the demand of converged fabric.

5. Evolutions of SaaS to KaaS
The increasing maturity and acceptance of Software-as-a-service (SaaS) offerings will combine with decreasing profit margins in the business process outsourcing (BPO) market and will add another layer to the cloud services stack. Knowledge as a Service (KaaS), extends the SaaS delivery model by its addition of intellectual property (IP) related to a particular horizontal process or industry to the standard SaaS offering. This new level of cloud services will enable SaaS and BPO vendors to form partnerships for the delivery of KaaS solutions with industry- and/or process-specific IP embedded within them.

6. Smart phones on the rise in emerging economies
India and China remain the twin engines of growth for the overall mobile segment. IDC expects the two countries to collectively chalk up over 295 million units in handset shipments in 2010. The key driver of smart phones in the emerging markets is the increasing sophistication of mobile users. Shipments of converged devices in China are expected to grow from 7.5 per cent of all shipments in 2008 to 13.5 per cent in 2010. For the mobile industry, this represents an enormous prospect and a growing one.

7. The dawn of the enterprise appliance
2009 saw a number of product launches that started to change the way vendors were thinking about hardware stacks and the solution offerings. This trend looks set to continue in 2010 and it is only a matter of time before hardware vendors emulate this proposition for dedicated, preconfigured hardware and storage for specific applications and workloads – the dawn of the enterprise appliance.

8. Revisiting Chargeback: Accountability across LOBs for IT
The ability to effectively provide chargeback functionality already exists at many levels: desktop, storage, and certain applications. IDC believes the full implementation of Chargeback 3.0 is some years away, as there are still levels of technical complexity that need to be addressed within certain IT platforms. In addition, this is a highly politically charged area with ownership and accountability transitioning through. However, once the full benefits of Chargeback 3.0 are understood by the business owners, these will likely be minimised, and vendors and IT management should have a road map.

9. Intelligent X: Building a smarter and more measurable world
IDC believes that 2010 will be a year of multiple "Intelligent" initiatives and tenders in Asia, as major governments and cities try to beat each other to the goal of securing foreign investment and foreign technology participation in this region. In these "Intelligent" initiatives, a new business model is emerging as a "Holy Trinity" consisting of government, ICT vendors, and citizens; all three working in sync is required to make inroads in emerging countries.

10. Machine-to-Machine (M2M): The evolution of "device grids" to offer new business and efficiency models
IDC believes that with over 600 million fixed-line subscribers in APEJ and over 1.6 billion mobile subscribers in APEJ, the addressable opportunity for Machine-to-Machine (M2M) will be roughly 10:1 or over 20 billion M2M devices connected to the public and operator networks in the region by 2020. The emergence of M2M will lead to new wholesale and retail business models that will focus specifically on providing the latency and quality of service needed for commercial M2M applications such as surveillance, smart electric grid, emergency services and environmental sensors.

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