Future facing

Emerging trends as the market reacts to a challenging year

Tags: United Arab EmiratesVirtualisation
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By  Imthishan Giado Published  September 28, 2009

As this challenging year begins to draw to a close, I'd like to draw attention to a few trends that have emerged in recent months. Some of them are drawn from discussions I've had with CIOs; others from the nominations we've received for the 2009 Arab Technology Awards.

Let's get the big one out of the way right from the onset -the state of the market - or rather, the perception of it. Currently, fear, uncertainty and doubt rule the roost in the Middle East as conflicting reports and rumours suggest that organisations are slashing away at IT budgets, retrenching staff and cutting back at the pace of innovation.

While either or all of these may be true, it's more likely that the market is changing to adapt to the current business conditions. Last year at the awards, for instance, the financial sector was clearly the prime mover, with the big money being spent on projects focusing on new services such as SMS banking and better communication channels with customers.

Well, we've all witnessed what happened over the intervening 12 months, but in terms of nominations, banking in the Middle East is still a heavy hitter - it's just quite the absolute kingpin. That honour has now jointly passed to the government sector, which lead the nomination count this year with a mammoth 15 entries. Education was not far behind with 10 entries, so it clearly demonstrates where the money is going at present.

What's interesting is where the money is going - many of the projects are targeted towards internal users and improving services for them, rather than external ones. Infrastructure is still important, but it seems that companies are focusing less on putting in big-iron servers and more on systems like WAN optimisation and virtualisation, aiming to make better use of existing resources. ISO certification is another big winner of late, although I'm still not convinced that it really improves a company's internal processes, as opposed to simply providing better marketing material.

The other interesting observation is outsourcing - that is, we can expect to see more of it happening. IDC figures state that it comprised just 21.4% of the total IT services market in 2008, but that more MNC vendors would be coming into the space in the near future. Presently, the Middle East market - particularly in the government space - is chiefly served by semi-government managed service providers who supply basic services like datacentre hosting.

However, this scenario seems ripe for change as enterprises start to realise that day-to-day operations such as capacity planning, network upgrades and server maintenance are beneath the talents of an IT department. Or to put it bluntly - if CIOs are still employing individuals whose sole job description is that sort of activity, they're wasting their budget. Outsourcers - or managed service providers - can easily supply the manpower (complete with their own project leads) for a far cheaper price and without the HR hassles of having in-house staff.

And finally - Windows 7. So far despite all the hype, there's been a surprisingly lack of interest from the user community. At present, we have just one confirmed end-user who's interested in it - Qatar University - and even they will only seriously consider it once the current semester has concluded. The majority of customers we're hearing about are presently from the SMB segment - which may not necessarily be the sort of big wins Microsoft is hoping for.

Here's my take - I believe that ultimately, Windows 7 will be more successful that it's much-reviled predecessor. It's not necessarily because it's a overall better product - indeed, it's largely Vista 1.1 - but mainly because this time, Microsoft have got the timing right, in terms of enterprise hardware cycles.

Most of the existing XP boxes - even with some creative stretching - are nearing the end of their useful life. If Windows 7 can run legacy apps without too much issue and on a reasonable basic hardware platform, most IT managers will be happy to drop it in as part of their purchase plans in Q1 2010.

That's my end of my prognostications for the moment - if you agree, disagree or just plain want to argue, drop me a line at Imthishan.giado@itp.com

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