Tag: IDC

IDC says the channel must embrace the DX economy

chinaflagBeancounters at IDC have been telling the Chinese channel that it must rush to embrace the digital transformation (DX) economy and what applies there, should really apply to Blighty.

China’s economy has entered a period of transformation and both the governments and businesses alike are actively seeking new growth modes. Digital transformation (DX) of business, backed by the latest ICT technologies, is the answer.

IDC forecasts that digital transformation will attain macroeconomic scale over the next three to four years, changing the way enterprises operate and reshaping the global and Chinese economy. This is the dawn of the “DX Economy”.

Kitty Fok, Managing Director of IDC China, said: “DX will be a top priority for all business in the coming decade. Executives must adapt to the new rules of competition and accelerate DX process; meanwhile IT executives must take up new roles, transforming IT department into a strong technical partner. Executives of ICT vendors must be aware of their customers’ new demands, changing from its role of tech support to a DX partner for customers. ”

China is expected to continue growing steadily in 2017, with GDP growth of more than six percent.

IDC predicts that the Chinese IT market will expand by 2.3% in 2017, entering a period of adjustment.

Personal device market is likely to remain flat whereas the enterprise infrastructure hardware market is expected to grow 7.3 per cent in 2017. The Software market is forecast to expand 7.5 per cent, while the IT service market to grow 8.7 per cent. Growth in the traditional hardware, software and services is likely to slow, but rapid growth of 15 per cent or higher is forecast for markets that are associated with innovation accelerator technologies (3D printing, robotics, cognitive system, Internet of Things, AR and VR, and the next generation security) and the 3rd Platform (cloud computing, big data, mobile, social).

IDC said that we are looking at the dawn of the DX Economy and that by 2020, 50 per cent of China’s Top 1000 companies will see most their business depends on their ability to create digitally-enhanced products, services and experiences.

There will be mass customization to accelerate business transformation: By 2018, the top 10% of China’s industry leaders will develop the ability to allow customers to build custom product and service bundles. By 2018, Chinese companies investing in IoT-based operational sensing and cognitive-based situational awareness will see 40 per cent improvements in the cycle times of impacted critical processes.

Information-based products and services will start gaining popularity. In 2018, one fourth of China’s Top 1000 companies will gain the revenue from information-based products. By 2020, the demand for digital-related services will account for 30 per cent of total worldwide services spending.

Crowd-funding to improve startup’s success rate, IDC said. By 2019, China’s Top 500 firms and lots of internet companies will use Kickstarter-like methods to allocate capital to 10 per cent of new projects, aiming to increase their new product introduction success rates by over 30 per cent.

Digital revenue streams will drive business growth. By 2019, 20 per cent of China’s IT projects will create new digital services and revenue streams that monetise data. More than 20 per cent of CIOs will shift primary focus from physical to digital and move away from BPM and optimisation by 2018.

 

There will be more self-adaptive security and risk management. The Chinese will tighten policy on security and controllability, driving investment on IT security by governments and large state-owned enterprises to grow by 15 per cent on average annually. By 2018, half of CIOs will help drive global risk portfolios that enable adaptive responses to security, compliance, business, or catastrophic threats.

The new wave of cloud computing (dubbed Cloud 2.0) will facilitate ICT ecosystem revolution. IDC said that by 2020, 40 per cent of all enterprise IT infrastructure and software spending will be for cloud-based offerings.

“The Cloud will morph to become distributed, trusted, intelligent, industry-focused and channel-mediated. By 2018, the number of Industry Collaborative Clouds will be more than 40; by 2020, more than half of China’s Top 100 will be digital services suppliers through ICCs,” IDC said.

Cheap tablets killing the sector

 

cheap-tabletsBeancounters at IDC claim that a flood of cheap tablets are killing off an already dying technology branch.

In a new report, IDC said that 43 million tablets shipped in Q3 2016 but that figure was actually the bad news.  The overall market declined 14.3 percent year-on-year, because of poor sales at the top end of the market. Basically consumers switching to cheap tablets with lower margins.

While there is a .8 percent quarter-on-quarter increase in shipments as vendors get ready for the holiday quarter. the market’s pants.

Amazon with its Fire tablets were the only tablets to see significant growth.  These were up 320 percent year-on-year but still only taking 7.3 percent of the market. Huawei sales increased 28.4 percent to 5.6 percent of the market.

Apple’s shipments fell 6.2 percent and Lenovo was down 10.8 percent. Samsung fell 19.3 percent.

Vendor 3Q16 Unit Shipments 3Q16 Market Share 3Q15 Unit Shipments 3Q15 Market Share Year-Over-Year Growth
Apple 9.3 21.50% 9.9 19.60% -6.20%
Samsung 6.5 15.10% 8.1 16.00% -19.30%
Amazon 3.1 7.30% 0.8 1.50% 319.90%
Lenovo 2.7 6.30% 3.1 6.00% -10.80%
Huawei 2.4 5.60% 1.9 3.70% 28.40%
Others 19 44.20% 26.9 53.20% -29.20%
Total 43 100.00% 50.5 100.00% -14.70%

IDC senior research analyst Jitesh Ubrani said that they -$200 tablets were spoiling the market for everyone.

He said that the “The race to the bottom is something we have already experienced with slates and it may prove detrimental to the market in the long run as detachables could easily be seen as disposable devices rather than potential PC replacements”

IDC thinks the IoT market is set to explode

hindenburg_burningBeancounters at IDC think that the Internet of Things (ioT) is suddenly going to stop being a buzz word and “explode.”

According to an IDC report IoT  is gaining traction as enterprise companies pivot away from proof-of-concept projects to scalable IoT deployments in 2016.

A third of companies have announced IoT offerings incorporating cloud, analytics and security capabilities, while an additional 43 percent of companies are looking to deploy offerings in the next year.

Carrie MacGillivray, vice president of mobility and Internet of Things at IDC said that outfits are starting to understand the benefits that IoT can bring.

She added that a strong partner ecosystem is essential and channel and systems integrators as playing an increasingly important role.

Companies are seeing vendors leading with an integrated cloud and analytics offerings as “critical partners” in an organization’s IoT investment, IDC found.

IDC’s survey found that 55 percent of respondents see IoT as strategic to their business to help them compete more effectively, there are still challenges – many organizations cited lack of internal skills as a top concern in deploying an IoT offering.

Bad time to be flogging servers

titanic-life-preserverBeancounters at IDC have said that it is a jolly bad time to be trying to flog servers and the numbers are sinking so fast that it is unlikely that the spotty kid with the posh girlfriend will escape before Celine Dion starts to sing.

The latest server sales figures for Europe, Middle East and Africa show that branded servers are losing ground to Far Eastern ODMs.

IDC numbers showed revenues down 3.7 per cent to $3 billion despite. All this happened while there was a  modest 0.8 per cent increase in the number of boxes shifted, which means that prices have fallen too.

Eckhardt Fischer, research analyst at IDC, said contract manufacturers, some of whom have launched their own branded gear, are doing well and the  HPEs, Dells and Lenovos of the world are suffering.

“This is strongly driven by the continued expansion of original design manufacturers (ODMs) in EMEA, a trend that IDC predicts will continue as mega datacenters and larger enterprises begin to source their hardware directly.”

HPE is still top server seller with 35.4 per cent market share in the second quarter of 2016, up 0.4 per cent. However its year-on-year revenues fell 2.7 per cent.

Dell grew market share to 17.9 per cent and saw revenues creep up by 1.6 per cent.

However Biggish Blue suffered the worst with a 36.9 per cent slump in revenues and a market share which fell to 9.3 per cent. IDC said the fall could largely be blamed on refresh cycles for IBM legacy mainframes last year – this was big enough to hit overall numbers for all vendors.

Oddly the place to try and peddle servers is Russia and the Ukraine where the improved political situation led to increasing IT investment. But the Middle East and Africa saw a decline of 8.5 per cent in revenues because lower oil prices led to cuts in tech investment.

 

IDC thinks PC sales worse than it thought

tarotreadingIDC has reached the conclusion that the PC market is a bigger mess than it originally thought and reshuffled its tarot cards for another prediction.

It now thinks that PC shipments  will decline by 7.3 percent year over year which is  two percent below what it was telling us before.

The outfit blames weak currencies, depressed commodity prices, political uncertainty, and delayed projects.

Microsoft is partly to blame because it handed out free copies of Windows 10 to everyone who asked, including a lot of people who didn’t.

IDC said that that “while a large share of enterprises are evaluating Windows 10, the pace of new PC purchases has not yet stabilised commercial PC shipments.”.

IDC now predicts just 255.6 million machines will ship in 2016, of which 103.3 million will be desktops. The firm reckons we’ll see “… progressively smaller declines through 2017 followed by stable volume in 2018.”

All up it seems that the PC market is such a mess that no one can effectively say how dire it will be, even half-way through the year. It also looks like most companies have written the year off as an an annus horribilis and only thinking about next year. Sooner or later the bigger companies will have to buy PCs but it looks like it will be much later.

 

Thin clients are thin on the ground

skeleton-woman-615While thin client set ups have been touted as the “next big thing” for nearly two decades, it would appear that no-one can make cash from them.

Bean counters at IDC said that the market leaders HP and Dell suffered double-digit shipment drops last year. Apparently companies are walking away from, or cancelling their thin-client projects. Ironically mostly before the poor economic climate, thin clients were touted as a cost-saving measure.

Thin client projects are being canned or postponed in the face of the faltering economic climate and reduced public budgets, IDC said as it warned that shipments in the sector shrank last year.

According to IDC, thin and terminal-client shipments fell 6.9 per cent to 5.08 million in 2015, with market leaders Dell and HP enduring double-digit drops.

To be fair it is not all doom. Thin-clients did better than PCs which fell 10.6 per cent last year.  IDC insists that the outlook for thin clients and virtual desktop infrastructure (VDI) remains favourable, although people have been saying that since networking became a thing.

Jay Chou, research manager, worldwide enterprise client device trackers at IDC said that while there was a certain amount of slowdown expected as many organisations had just refreshed their systems a year or two ago, the extent of economic and currency-related issues had a definite impact in the budget and timeline of other projects which were supposed to be in the pipeline.

“Nonetheless, awareness around VDI continues to improve, and IDC does expect an improved outlook ahead, especially as companies begin to think about moving beyond Windows 7.”

While the PC market may be consolidating into the hands of fewer players, the same cannot be said of thin clients, where market leaders Dell and HP lost market share hand over fist during the year.

The US duo’s collective share of thin-client shipments fell from 55.1 to 50.6 per cent between 2014 and 2015, with Dell seeing shipments drop 13.8 per cent and HP suffering a 15 per cent fall, IDC said.

NComputing came third as its shipments rose 12.8 per cent to 518,000, IDC said.

Microsoft’s cloud partners make a killing

cloud (264 x 264)Beancounters at IDC have been adding up some numbers and reached the conclusion that Microsoft’s cloud  partners are making a killing.

IDC and Microsoft released a report with the catchy title “The Booming Cloud Opportunity” which appears to be the first in a series. Book two will probably take place a few years after book one and feature some of the original characters.

It is based on detailed interviews with 25 partners with solid credentials, like Christopher Hertz of New Signature, Mark Seeley of Intellinet and Geeman Yip of BitTitan.

Basically it says that Microsoft’s cloud Partners have double the growth of those who are less-cloudy. IDC defines cloud partners as companies that get at least half of their revenues from the cloud. Of the 750 Microsoft partners they surveyed, about a fifth of them hit that mark. That top tier of cloud partners reported overall company revenue growth of 24 percent on average, while the rest saw growth of 12 percent.

Next it says that Cloud Partners have 1.5 the gross profit  of the less-cloudy . The figure for the cloud partner group is 41 percent gross profit, while the rest had 27 percent.

Apparently Cloud Partners have 1.8x the recurring revenue of the others. The cloud partners reported that 52 percent of their overall revenues, not just cloud revenues, came from recurring revenue sources. That compares to about 29 percent of revenues coming from recurring sources for the rest of the partners in the survey.

Other findings are that Cloud Partners sell $5.87 of their own offerings for every dollar of Microsoft Cloud Solutions. The rest of the surveyed partners sold $3.71 of their own offerings for every $1 of Microsoft cloud solutions. Importantly on this one, only a little over 400 partners answered.

The IDC report does warn that the surveys don’t always reveal causation.”There’s a lot going on inside all of these partner businesses that could account for the differences other than how much Microsoft cloud services the companies sell.

The report goes against the  popular channel opinion on cloud — that selling cloud services is a recipe for lower margins and lower profitability.

PC market blighted by inventory problems

old-pcs-100565082-primary.idgeBeancounters at IDC claim that the reason that the PC market is not picking up is because there is far too much inventory out there.

IDC said that this high inventory, falling commodity prices and foreign exchange issues meant it was reducing its outlook for the PC market for 2016.

Expectations for early 2016 were already pretty grim, but a range of factors has prompted it to reduce its 2016 outlook “by a couple of percent”. Now, it predicts the global market will decline 5.4 percent annually.

IDC predicts that by 2018 the market will “effectively stabilise” but will not avoid some small declines in certain quarters before then.

The analyst pointed to the SMB and education sectors were star performers when it comes to PCs.

Jay Chou, IDC’s research manager said that in addition to specific devices, the SMB and education segments are expected to do better than the overall market.

“There have been indications of faster commercial adoption of Windows 10 than of past operating systems, and that should support some growth in the medium term. Similarly, IT access for students remains a priority, and will drive projects across regions – even though constrained government spending may limit some projects.”

2016 could be the year of the public cloud

grandpa_simpson_yelling_at_cloudA battery of reports suggests that more companies are going to push data onto the public cloud this year.

Public cloud setups are being suggested as a good idea for resellers to push on startups and software test and development, but now they are making its way into the corporate data centre and enterprise.

A recent IDC study reveals that spending on public cloud IT infrastructure will increase by nearly 30 percent to $20.5 billion in 2015 and now a Dimensional Research survey, released by Cloud Cruiser, a provider of software solutions for hybrid cloud analytics, finds that more companies are committing to public clouds for enterprise applications.

They are particularly interested in ERP and CRM all of which means good business for cloud services providers.

One of the stranger findings is that all this is taking place with very little information available about cloud costs and consumption.

It is looking like channel players need to provide “solutions” that help customers gain greater usage visibility and cost transparency into their public cloud investments and, if they pull it off, they could be laughing all the way to the bank.

Cisco brings IoT certification to channel

ciscoCisco is helping its channel partners get a leg up into the Internet of Things.

The idea is to run training programmes to give them the skills needed to try to capture some of the $19 trillion it expects from the new industry.

A new Cisco Certified Network Associate Industrial IoT certification has been set up along with two new cloud certifications to help partners deliver optimal business outcomes.

Cisco thinks its channel needs to understand the context of the industrial and IoT environments while it is deploying and managing these network and IT devices.”

The lab-based training program targets networking engineers, plant administrators, control engineers and IT engineers and teaches them how to build, manage and operate converged industrial networks in the fast-growing IoT manufacturing markets.

The certification targets both the customers and channel partners

Last week, research firm IDC released a report forecasting that the IoT market in manufacturing operations will grow from $42.2 billion in 2013 to $98.8 billion in 2018 — representing a CAGR of 18.6 percent.

Dell comes back from the dead

i-walked-with-a-zombie-from-left-everettBeancounters at IDC are claiming that Dell’s US shipments grew 19.7 percent during the third calendar quarter of 2014.

If this is the case, then it would appear that business is turning around for the tin box shifter.

Jeff Clarke, Dell’s vice chairman, Operations, and president, Client Solutions said that the reason for the increase was a strong notebook performance in the US and accompanying overall worldwide growth reflects the continued momentum. He said Dell did not intend to slow down.

“You can expect us to maintain our strategy of investing in the PC business, with more additions to our portfolio to be announced next week at Dell World,”Clarke said.

Dell was showing off its PC business in which it said had its seventh consecutive quarter of year-over-year gains in global share and grew more in the third quarter than its top two US competitors combined.

Dell also talked about its commercial portfolio which appeared to be focusing on higher performance PCs and thin clients.

Dell also claimed there was a growing demand for flexible 2-in-1 products in the work environment with the Latitude 13 7000 Series 2-in-1.

Now that the outfit has gone private we have no way of checking any of this as it does not have to share anything and we have to take its word for it.

Tablet sales go slow

ipad3Market research firm IDC said it has lowered its forecast for tablet sales in 2014 almost halving its estimate of how many will ship.

The reason for that, according to the company, is that buyers in mature markets are contributing to flatness.  The estimate now is that 233.1 million units will ship – its previous estimate was a year on year 12.1 percent growth rate. It’s lowered that rate to 6.5 percent now.

But while the “mature markets” are showing a slowdown, IDC said that other regional markets will hit a 12 percent growth rate.

More use of tablets in emerging markets will sustain that 12 percent figure.

IDC estimates that average selling prices will level out at $373 in mature markets but fall in other regions to $302.

Jitesh Urbani, senior research analyst at IDC said that the world outside Western Europe and North America will account for the majority of shipments this year.  “But in terms of dollars spent, medium to large sized devices in North America and Western Europe will still produce significant revenues,” he said.

HPC server market falls

server-racksA report  from market research company IDC said factory revenues for the high performance computing server market fell by close to 10 percent in the first quarter of 2014, compared to the same period in 2013.

Revenues fell from $2.5 billion to $2.3 billion.

But the long range view for the supercomputers sector of the market is expect to see reasonable growth with a CAGR of 7.2 percent to 2018.

HPC technical computing analyst Earl Joseph said that the race towards exascale computing means that SMEs and research outfits are likely to use HPCs in the future.

HP is the clear leader in the market with 35 percent share, IBM has 23.1 percent share, while Dell managed third place accounting for 17.2 percent of global revenues.

The overall HPC technical server market is likely to be worth $14.7 billion by 2018.

Server revenues up. A bit

bummerA report from IDC said EMEA server revenues showed a slight uptick in the first quarter of this year – up 1.5 percent compared to the same quarter last year.

The EMEA server market generated $2.8 billion in the first quarter – that’s $44 million more than the same quarter in 2013 and amounting to 537,800 units.  That’s 22,000 units less than in 2013 and that’s because virtualisation and integrated systems are making their mark.

IDC said that there’s a negative trend in the market amounting to a 20.3 percent decrease in vendor revenues when you compare the 4th quarter of 2013 and the first quarter of this year.

“Despite a strong push for additional capacity in megadatacentre customers and renewed focus on tower and rack volumes by the largest OEMs, the macro trend in the X86 market continues to point to value as the only real growth opportunity,” said Giorio Nebuloni, research manager for enterprise servers at IDC Europe.

He said the blade market shows strong growth in the higher end market with higher aversage selling prices.

The X86 server market accounted for $1.72 billion in Q1 – that’s 81 percent of total values. Non X86 vendors generated $541 million, amounting to 3,810 units in EMEA.  This bit of the market is showing a decline.

The top dogs in the EMEA region were HP, IBM, Dell, Fujitsu, Oracle and the ubiquitous “others” – as this IDC chart demonstrates.
serversQ12014

PC shipments in Europe “stabilise”

european-commissionA report from market research firm IDC said there are indications that shipments of PCs in the European, Middle East and Africa (EMEA) stabilised in the first quarter of this year.

21.8 million units shipped in EMEA, a decline of 1.1 percent compared to the same quarter last year.

But Western Europe showed a growth of 8.6 percent, spurred by business demand.  If that percentage is taken as a pie, commerical units showed an increase of 15.1 percent, while the retail market showed growth of 2.1 percent.

It’s the end of support for Windows XP that drove the rebound, according to Chrystelle Labesque of IDC.  And companies have started to invest in IT again, she said.  There is more business confidence.  Neverless, the overall PC market in central and eastern Europe and in the Middle East and Africa showed a year on year decline of 12 percent.

HP did well, as did Lenovo, while Dell was in third place and Acer in fourth place.  Asus took the fifth place.