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Analysts Discuss Key Issues Facing the IT Industry During Gartner Symposium/ITxpo 2012, October 10-12, in Goa
IT spending in India is projected to total $71.5 billion in 2013, a 7.7 percent increase from the $66.4 billion forecasted for 2012, according to Gartner, Inc.
Peter Sondergaard, senior vice president and global head of research at Gartner, provided the latest outlook for the IT industry here today to an audience of more than 700 CIOs and IT leaders at Gartner Symposium/ITxpo, which is taking place here through October 12th.
India like other emerging markets continues exercising strong momentum despite inflationary pressures and appreciation of local currencies, which are expected in rising economies,Mr. Sondergaard said.
The telecommunications market is the largest IT segment in India with IT spending forecast to reach $47.8 billion in 2013 (see Table 1), followed by the IT services market with spending of $10.3billion. The computing hardware market in India is projected to reach $9.5 billion in 2013, and software spending will total nearly $4.0 billion. Software will record the strongest revenue growth at 15 percent, IT services will grow at 12 percent. The telecom segment, which accounts for 67 percent of the Indian ICT market, is set to grow at 7 percent revenue growth in 2013 (see Table 1).
Table 1
India IT End-User Spending Forecast, 2012-2016 (US$ Billions )
| 2012 | 2013 | 2014 | 2015 | 2016 | CAGR (2012-2016) % |
Hardware | 9.1 | 9.5 | 10.9 | 12.5 | 14.3 | 7.5 |
Software | 3.5 | 4.0 | 4.5 | 5.2 | 6.0 | 11.4 |
Services | 9.2 | 10.3 | 11.9 | 13.8 | 16.1 | 8.9 |
Telecom | 44.7 | 47.8 | 51.5 | 54.6 | 59.5 | 3.6 |
Total | 66.4 | 71.5 | 78.9 | 86.2 | 95.9 | 5.3 |
Source: Gartner (October 2012)
Businesses are increasingly looking to IT to help support the challenges of enhancing customer support, supply chain management, optimizing business processes or helping drive innovation in the business,Mr. Sondergaard said. hese demands are being placed on IT in an environment in which the infrastructure (hardware and software) foundation of IT within many enterprises may not be entirely in place. IT is also in transition from being viewed as a back-office support function to a frontline business-focused function.”
The hardware segment will account for 14.1 percent of all IT spending in India by 2016, driven by positive contributions from the storage and the client computing segment, said Partha Iyengar, head of research – India, at Gartner. Mobile phones will continue to be the fastest growing space within the Indian IT market. During the same time period, this segment will also account for nearly 42 percent of all telecommunications revenue in India, and it will also account for nearly 26 percent of the overall IT spending.
While IT is the primary driver of business growth, concerns around the economic slowdown are gathering strength and are a matter of concern. In Gartner’s latest CEO survey, 85 percent of CEOs believe they will be negatively impacted by the global economic slowdown. However, IT will remain well supported by CEOs compared with other areas of investment. Two-thirds of CEOs believe IT will make a greater contribution in their industries in the next 10 years than in any prior decade. Despite the troubled global economy, 40 percent of CEOs intend to raise their investment in IT. Eighty percent of them can name a company that is using IT-related innovation for competitive advantage. This has a cascading impact on the role of a CIO who will now have to think strategically and having a direct contribution in the way business works and the way the global economy develops.
We live and work in an age of incredible promise. An age unleashed by a nexus of forces; social, mobile, information and cloud. While there is economic uncertainty there is also enormous opportunity. IT is at the center of every business, every government agency from the backend and the edge, directly to the customer. These forces are innovative and disruptive just taken on their own, but brought together, they are revolutionizing business and society, Mr. Sondergaard said. This nexus defines the next age of computing. To understand this change, you must appreciate each of the forces.
Social: With 1.5 billion people or 20 percent of the world’s population on social networks, $34 billion from ads, gaming and subscription markets, social computing is in its next phase. Social computing is moving from being just on the outside and into the core of business operations. It is changing the fundamentals of business management and redefining the operational model to engineer a set of behaviors that ultimately aids professionals in getting their job done. By 2015, 10 organizations will each spend over $1billion on social media.
Mobile: In 2016, more than 2.7 billion mobile devices will be purchased globally, two-thirds of the workforce will own a smartphone, and 40 percent of the workforce will be mobile. With this new channel to customers and employees, organizations should design their business around mobile. This will have a positive impact on application delivery, employee productivity and process work flows.
In less than 2 years, 20 percent of sales organizations will use iPads as the primary mobile platform for their field sales force. By 2018, 70 percent of mobile workers will use a tablet or a hybrid device that has tablet characteristics. Asset ownership is also changing- by 2016 half of all non-PC devices used in business will be purchased by employees; and by the end of the decade, half of all devices in business will be.
Information: The concept of one enterprise data warehouse containing all information needed for decisions is dead. Multiple systems, including content management, data warehouses, data marts and specialized file systems tied together with data services and metadata, will become the “logical” enterprise data warehouse.
Big Data is about looking ahead, beyond what everybody else sees. Not at what already happened, or what is happening now, but what will happen next. The leading organizations of the future will be distinguished by the quality of their predictive algorithms. By tapping an incessant stream of information from internal and external sources, businesses today have an endless array of new opportunities for transforming decision-making, discovering new insights, optimizing the business and innovating their industries. Gartner expects 30 percent of large enterprises over the next four years will hire Chief Data Officers responsible for curating, managing and governing information and finding professionals, such as data scientists and experts in non-relational DBMS technologies.
The Cloud. The cloud combines the industrialization of IT capabilities and the disruptive impact of new IT-led business models. However, the shift away from traditional IT acquisition models to public cloud services is still in the very early stages in India. Large enterprises in India are gravitating toward a private cloud model to better understand the constructs of cloud computing within their own premises before deciding to move some applications onto a public cloud model. Between 2011 and 2016 the market for Business Process Services in the cloud will double in size to nearly $145 billion.
Gartner analysts are examining the key issues affecting the Indian IT industry at Gartner Symposium/ITxpo.
About Gartner Symposium/ITxpo
Gartner's annual Symposium/ITxpo events are key components of attendees' annual planning efforts. IT executives rely on Gartner Symposium/ITxpo to gain insight into how their organizations can use IT to address business challenges and improve operational efficiency.
Additional information for Gartner Symposium/ITxpo in India, October 10 – 12, is available at www.gartner.com/in/symposium. Members of the media can register for the event by contacting Sony Shetty, Gartner PR on +91 9820900036 or sony.shetty@gartner.com
Additional information from the event will be shared on Twitter at http://twitter.com/Gartner_inc and using #GartnerSym.
Upcoming dates and locations for Gartner Symposium/ITxpo include:
October 21-25, Orlando, Florida: www.gartner.com/us/symposium
October 29-31, Sao Paulo, Brazil: www.gartner.com/br/symposium
November 5-8, Barcelona, Spain: www.gartner.com/eu/symposium
November 12-15, Gold Coast, Australia: www.gartner.com/au/symposium
March 5-7, 2013, Dubai, UAE: www.gartner.com/technology/symposium/dubai/
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