Tag: IT spending

Insurers to spend, spend, spend on IT

shut-up-and-take-my-moneyInsurers with a worldwide presence are set to spend over $100 billion this year on IT. That will gladden the hearts of vendors.
This is the view of IDC Financial Investments, which says that the number is an increase of 4.4 percent compared to 2014.
The global insurers want to spend this money to boost “efficiencies”, meaning that they will invest in data warehousing, claims and policy administration systems.
Li-May Chew, lead director for IDC’s Financial Insights division, said that the insurers need to act.
She said: “Replacements or refreshes are required as legacy IT systems become increasingly complex, inflexible and archaic, to the point of negatively affecting technology integration and interoperability.”
In other words, they’re out of date.
The insurers want to modernise their systems and use the cloud to cut costs – and customers want the insurers to do that too.
They want to make sure their customers use PCs, mobile devices and social networks.
They need to protect themselves against fraud.
Li-May didn’t say which vendors would benefit from the increased spend – but the emphasis is on mobile computing, cloud services, social networking and big data analytics.
So the usual suspects – that is to say IBM, HP, Dell, Oracle and others will be sitting patiently waiting for the phone to ring so they can pick up the orders.

 

Worldwide IT spending still to grow

Pic Mike MageeIT spending worldwide will reach $3.8 trillion 2015 – that’s up 2.4 percent from last year.
But market intelligence company Gartner has warned that its earlier prediction of 3.9 percent will be affected by the rise in the price of the US dollar as well as conservative sentiment about services and devices.
But Gartner research VP John-David Lovelock sought to play down the reduction.  He said it “is less dramatic than it might at first seem.  The rising US dollar is chiefly responsible for the change.  Stripping out the impact of exchange rate movements, the corresponding growth figure is 3.7 percent.”
Gartner breaks down the spending by categories as follows:

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Datacentre systems will be worth $143 billion in 2015, while enterprise software will total $335 billion.
There will be a price war in cloud per seat during 2015 with price drops of as much as 25 percent right through until 2018.  Vendors are discounting cloud offerings heavily, said Gartner.

 

IT vendors expect cash bonanza from India

Narendra Modi, India's PM - picture Wikimedia CommonsNext year the Indian government is likely to spend a staggering $7.2 billion on information technology, promising rich pickings for vendors that can surf the wave.

According to market research firm Gartner, that figure will be a five percent increase over this year and the $7.2 billion cake includes plums that cover hardware, software, IT services and telecomms.

Anurag Gupta, a research director on the subcontinent for Gartner, reckons IT services will be worth $1.8 billion in 2015, and the business process outsourcing segment will grow by 22 percent during this year.

Government spending on software is likely to be worth $910 million in 2015 – much of that being on vertical software.

Gupta said the new government’s aims are only able to be achieved by using technology and digital government, in particular broadband penetration, cloud initiatives, and public private partnership.

IDC expects further IT spending slowdown

pc-sales-slumpIDC has taken a second look into its crystal ball and revised its earlier forecast for worldwide IT spending. Of course, the new numbers are lower.

In May IDC forecast 4.9 percent growth, but now it expects 4.6 percent. What’s more, if tablets and smartphones are taken out of the equation, spending will be up just 1.7 percent. IDC’s May forecast was 2.6 percent.

IDC cites a slowdown in economic growth in emerging markets as the main reason behind its decision to lower forecasts. Growth is slowing down in China and Asia Pacific. Europe is not even worth mentioning. However, it’s not all bad news. IT spending in the US is now expected to increase 4.6 percent this year, up from 4.2 percent forecasted in May.

There’s some good news for mobile outfits, too. IDC expects spending on tablets to be up 39 percent this year, up from a May forecast of 32.5 percent. Smartphone projections are also up, 18.5 percent over 17.2 percent in May.

Unsurprisingly there is nothing good to report on the PC front. PC sales worldwide are now expected to decline 7.2 percent this year. The May forecast was just 2.6 percent in the red. That’s a huge revision in the space of less than three months and the PC market is clearly in worse shape than analysts thought.

Gartner slashes 2013 IT forecast

pc-sales-slumpGartner has revised its forecast for worldwide IT spending due to very soft demand for PCs. The outfit believes sales of traditional PCs will continue to lose steam in the second half of the year and there seems to be no end in sight. 

The analyst firm estimates spending on IT will total $3.7 trillion this year, which is actually up two percent from last year, but it is still far short of 4.1 percent predicted earlier this year. A number of other factors are hurting demand. Big G said unfavourable exchange rates and constant currency growth in Western Europe are not helping, either.

Windows 8 and Haswell failed to jump start the PC market, Gartner notes , but there might be light at the end of the tunnel. New devices and new form factors are coming, but at this point it is very unlikely that a bunch of hybrids and touch-enabled Ultrabooks can turn the tide. They will help, but they won’t reverse the trend.

Although IT departments aren’t expected to go on a spending spree over the next six months, things could change in early 2014, as they get ready to phase out XP boxes in Q1 and early Q2. Despite that, there doesn’t appear to be much room for optimism this year.

Windows 8.1 will launch on a number of new devices, but nobody is expecting it to make much of an impact. Intel Haswell and AMD Richland chips are out and the first products are already shipping and they will soon be joined by low-voltage Atoms and AMD Jaguar based APUs. On top of that, new Ultrabooks and hybrids are coming, too.

However, businesses rarely go for Atoms and Jaguars and IT departments tend to view new form factors like hybrids and thin clamshells as unnecessary gimmicks, so most new products that will enter the fray this year will be consumer oriented.

Gartner believes BYOD will save the world

threeiphonesTight-arsed corporate types are planning to shift their computer hardware bill to their staff, according to analyst outfit Gartner.

In a new report, Big G have been talking up the future of Bring-your-own-device, claiming that the trend is the single most radical change to the economics and culture of client computing in a decade.

Gartner predicts that by 2017, half of all employers will require workers to supply their own devices for work purposes. What is particularly unpleasant is the enterprises will more often than not refuse to give money to help employees buy their gear.

More than 38 percent of companies expect to stop providing devices to workers by 2016 and let them use their own, according to a global survey of CIOs.

Basically it means that employees will shift the cost of buying personal computers onto their staff.

Of course, the trend will happen in the US first where employers are allowed to treat their employees like slaves or they are not being patriotic.

Big G said that companies in the United States are twice as likely to allow BYOD as those in Europe.

Companies in countries such as India, China and Brazil are already forcing their staff to buy their own standard mobile phones at work.

By 2015, the number of employees using mobile applications in the workplace will double. Today, roughly half of BYOD programs provide partial reimbursement.

Mass-market adoption of BYOD and the steady decline in carrier fees, employers will gradually reduce subsidies until they are no longer there.

Gartner’s David Willis said that the enterprise should subsidise only the service plan on a smartphone. It is better for them to keep it simple because if they buy a device for an employee and they leave it is impossible for them to settle up.

Employees are generally thought of as being happy with the plan so employers do not have to see it as a cost cutting idea.

EMEA CIOs expect higher IT spending in 2013

server-racksWe might be a bit closer to bottoming out. According to a study commissioned by Riverbed Technology, 71 per cent of CIOs in the Europe, Middle East and Africa (EMEA) region expect IT spending will go up this year, reports IT Web.

A total of 400 CIOs across the region took part in the study and answered a few questions about their spending priorities over the next 12 months. They were asked to pick their top five priorities and virtualisation and consolidation programs ranked first. About 50 per cent believe server virtualisation will be their primary spending priority. Data consolidation ranks second at 40 per cent, followed by storage consolidation, desktop virtualisation, server upgrades security and compliance, and WAN optimisation, all in the 32 to 34 per cent range.

Oddly enough, the study found that 10 per cent of CIOs plan to make rather aggressive investments in an effort to boost competitiveness. However, 28 per cent claim their focus will be on efficiency and overall cuts in spending over the next 12 months.

It is hardly surprising that 33 per cent of CIOs plan to approach investment cautiously in 2013, but most plan to keep spending at current levels. Only 9 per cent said their IT budgets were shrinking and that they would spend less than last year.

Although most outfits see potential to cut costs through data centre and server consolidation, there’s apparently a lot of room for improvement in WAN performance. As many as 38 per cent of the CIOs said application performance over WAN is a barrier to consolidation.