Glancing Backward, Peering Ahead

By any measure, 2008 was a memorable year. Continuing global meltdowns, both ecological and economic, are likely to qualify 2008 as an annus horribilis of particular note. It seems somehow appropriate then that the incoming U.S. president ran on a platform based on hope and change, two of the most metaphorically loaded words in the English language. We can only wish him and his administration well.

Hope and change were certainly on the minds and in the solution sets of virtually every enterprise IT vendor. From the January 1st starting gun, it seemed that vendors were preparing for near-tectonic technological and behavioral shifts, from supporting dramatic data center consolidation efforts and enabling new classes of information management to promoting emerging computing infrastructures and proselytizing technology solutions in every shade of green.

We expect vendors to continue pressing forward with many of these efforts in the coming year but must also offer a simple caveat: Enterprise IT purchasing decisions will be deeply affected, or entirely driven, by the performance of the larger economy. While the current situation is certainly reminiscent of previous downturns, the likes of its depth and breadth have not been seen for a generation or more.

When confronted with the murky unknown, most folks step back and wait for the fog to clear a bit before moving carefully forward. In such circumstances, familiar performance trumps uncertain benefits, a point vendors would do well to remember. Overall, we believe the following issues will be a few that come to the fore during 2009:

"Business value" is the new innovation. The IT industry loves buzzwords, and 2008 had more than its fair share. But the second half of the year saw many vendors subtly (and some not so subtly) repositioning their messaging to emphasize "business value." What exactly is technology business value? Try the ways in which IT products and solutions tangibly contribute to an organization's fundamental health and longevity, not just its technological capabilities or economic success. There are many good reasons for the move to business value, and we expect them to resonate throughout 2009.Across the board, CIOs and IT managers are being encouraged (i.e., ordered) to "do more with less" (i.e., minimize or entirely eliminate non-critical IT purchases). This will naturally affect some products and vendors more seriously than others. For example, we expect sales to slow for corporate desktops, servers, and networking solutions, as few companies are deeply impacted by stretching the replacement cycles for those devices. However, since organizations continue to create, store, and archive information even in downturns, storage will suffer proportionately less. We also believe that sales of IT solutions that enhance the performance of existing technology assets -- virtualization and data de-duplication are two prime members of this category -- will remain relatively brisk.

Sustainability replaces "green." As an IT buzzword, "green" led the pack (closely followed by the lively "cloud computing" and a faltering "Web 2.0") for much of 2008. This was especially the case during the months-long crunch that saw U.S. gasoline prices spike to over $4.00 per gallon. During that period, the sky seemed the limit for alternative and renewable energy technologies, as well as numerous green data center initiatives. But interest in some green technologies plummeted in tandem with oil prices (just check out the myriad hybrid cars still available at Toyota and Honda dealerships).

That said, we believe that the case for energy efficient business IT remains strong, particularly given the economy's condition. At the same time, many vendors are shifting from promoting green IT to broader "sustainable" solutions that emphasize dollar return as much as ecological value, and we expect this trend to escalate in 2009. This seems entirely reasonable, since IT is one of the few areas that can help organizations become both financially and environmentally sustainable.

Tradeshows on life support. We noted fall-offs in attendance at a wide variety of IT tradeshows during 2008, and we expect this trend to continue or even accelerate in 2009. The media firestorm over Apple's ending its participation in MacWorld after 2009 (and Steve Jobs's participation in the upcoming January event) deflected attention from Novell's decision to cancel its BrainShare conference in March. Since BrainShare has chugged along for some 20 years, its demise may serve as a canary in the IT tradeshow coal mine.

That may be an overstatement -- the cancellations may simply be an acknowledgement of users' current, greater economic concerns. But if vendors are having fundamental problems defining or proving the value of their events, the tradeshow model may be in for even harder times. Whether that is the case or not, we believe that vendors would be wise to consider how they can best continue supporting and interacting with clients and partners in lieu of tradeshows and similar events.Science resuscitated. The past eight years have been a tough time for sciences and scientists in the public sector. Cronyism ran rampant in the administration of numerous federal science panels and departments; unqualified third parties (some with clear conflicts of interest) were allowed to influence, edit, or even rewrite research studies and reports; and pseudo-science and scientists gained prominence far out of keeping with the value of their ideas.

In truth, the devaluation of science eventually rolls down into the IT industry, reducing students' interest in scientific disciplines and limiting the availability of home-grown scientists, mathematicians, and engineers. Despite recognition of the value IT can bring to a wide range of government efforts and programs in the public interest, recent years have witnessed far more failures than progress. Recent cabinet appointments by Barack Obama suggest the president-elect intends to act forcefully to reverse these trends, and we hope to see the first fruits of these changes in 2009.

Charles King, President and Principal Analyst for research firm Pund-IT Inc. , focuses on business technology evolution and interpreting the effects these changes will have on vendors, their customers, and the greater IT marketplace.