Computing 2010 An IDC Update Frank Gens, Senior Vice President & Chief Analyst Robert Mahowald, Research Director, SaaS & Services Richard L. Villars, Vice President, Storage Systems & Executive Strategies David Bradshaw, Research Manager, Applications and Solutions, EMEA Chris Morris, Research Director, Services Research, Asia/Pacific IDC Executive Telebriefing 29 September 2009 Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved.
Services Global Overview Description: Services: Global Overview is IDC s unique program that gives the "rolled-up" view of the entire opportunity for IT Service provision. This program will provide the complete services opportunity segmentation by 3 regions and by technology segment (7-10 Black Book segment level). For further drill down please see specific market programs. It will provide survey data on: How quickly Services will be adopted and by which customer segments How will impact vendor business models and service offerings Will examine the customer benefits and challenges surrounding Services Coverage: An IT Services Forecast, consisting of 7-10 Black Book-level categories (Servers, Storage, Apps, etc), with a 3-region split (EMEA, Americas, Asia Pacific), and an enterprise size split (large, medium, small) IDC s definition and taxonomy user survey findings and spending intentions Vendor strategy briefs driven by events, announcements Industry structure/model scenarios, predictions - focused on mega-shifts IDC sees in industry structure, strategies and other topics Lead Analysts: Frank Gens, Robert Mahowald, Rick Villars New Regional Associates: Chris Morris (AP), Satoshi Matsumoto (Japan), Vladimir Kroa (CEE), David Bradshaw & Chris Ingle (W. Europe), Lidice Fernandez (Latin America) 2009 IDC 2
Services Definition - updated casual description Key Attributes Services Consumer and Business products, services and solutions delivered and consumed in real-time over the Internet Shared, standard service built for a market (public), not a single customer Solution-packaged a turnkey offering, integrates required resources Self-service admin, provisioning; may require some on-boarding support Elastic scaling dynamic and fine-grained Use-based pricing supported by service metering Accessible via the Internet/IP ubiquitous (authorized) network access Standard UI technologies browsers, RIA clients and underlying technologies Published service interface/api e.g., web services APIs 2009 IDC 3
Services Definition - updated Services Consumer and Business products, services and solutions delivered and consumed in real-time over the Internet Key Attributes Shared, standard service built for a market (public), not a single customer Solution-packaged a turnkey offering, integrates required resources Self-service admin, provisioning; may require some on-boarding support Elastic scaling dynamic and fine-grained Use-based pricing supported by service metering Accessible via the Internet/IP ubiquitous (authorized) network access Standard UI technologies browsers, RIA clients and underlying technologies Published service interface/api e.g., web services APIs Deployment Models [Note: large gray zones between these two broad categories] Public - open to a largely unrestricted universe of potential users; designed for a market, not a single enterprise Private - designed for, and access restricted to, a single enterprise (or extended enterprise); an internal shared resource, not a commercial offering; IT Org is the vendor of the shared/std service to its users 2009 IDC 4
IT Services Taxonomy IT Services Applications (Apps-as-a-service) (Application) Platforms (Platform-as-a-Service) App Dev/Test App Deploy Infrastructure (Infrastructure-as-a-Service) 2009 IDC 5
(Software-as-a-Service) All Types of IT Software & Hardware Are or Will Be Offered as Services Corresponding Primary Market IDC IT Product Taxonomy Applications IT Services Applications (Apps-as-a-service) Collaborative Applications Content Applications Enterprise Resource Management Applications Supply Chain Management Applications Operations and Manufacturing Applications Engineering Applications Customer Relationship Management Applications App Dev & Deployment Systems Infrastructure Software Systems Storage (Application) Platforms (Platform-as-a-Service) App Dev/Test App Deploy Infrastructure (Infrastructure-as-a-Service) Application Development Software Application Server Middleware Data Access, Analysis, and Delivery Information & Data Management Integration & Process Automation Middleware Other Application Dev and Deployment Quality & Life-Cycle Tools Enterprise Portals System and Network Management Software Security Software Storage Software System Software Servers Storage Networks Clients many IT and Network Services will also be transformed and extended to support the cloud service delivery model 2009 IDC 6
Services Beyond the IT Industry Every Other Industries Services The IT Industry s Services Business (Process-as-a-service) Applications (Apps-as-a-service) App Dev/Test (Application) Platforms App Deploy Infrastructure (Infrastructure-as-a-Service) 2009 IDC 7
IT s Opportunities Landscape Provide IT as Services Provide Services around IT Services Provide IT Products/Services to enable (public & private) SPs arms dealer Servers Storage IT/Network Network Management Equipment Software Network Services IT Services Consulting, Integration, etc. App Development/ Deployment Software HW & SW Vendors Pureplay Telcos IT & Network Svcs 2009 IDC 8
User Surveys - Benefits Q: Rate the benefits commonly ascribed to the 'cloud'/on-demand model Pay only for what you use Easy/fast to deploy to end-users Monthly payments Encourages standard systems Requires less in-house IT staff, costs Always offers latest functionality Sharing systems with partners simpler 77.9% 77.7% 75.3% 68.5% 67.0% 64.6% 63.9% Seems like the way of the future 54.0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% (Scale: 1 = Not at all important 5 = Very Important) Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 2009 IDC 9
User Surveys - Challenges Q: Rate the challenges/issues of the 'cloud'/on-demand model Security Availability Performance On-demand paym t model may cost more Lack of interoperability standards Bringing back in-house may be difficult Hard to integrate with in-house IT Not enough ability to customize 87.5% 83.3% 82.9% 81.0% 80.2% 79.8% 76.8% 76.0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% (Scale: 1 = Not at all concerned 5 = Very concerned) Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 2009 IDC 10
User Surveys Adoption Areas Q: Rate your likelihood to pursue the cloud model for the following Collaboration applications Web applications/web serving 67.3% 66.9% Data Back-up or Archive services Business apps (CRM, HR, ERP) Personal productivity apps Data/Content Distribution services Storage capacity on demand IT Management software Server capacity on demand Business Intelligence/Analytics Application dev/test/deploy platform IT/Information Security 59.4% 55.6% 55.1% 54.8% 52.9% 51.3% 50.6% 49.8% 49.1% 48.6% 0% 10% 20% 30% 40% 50% 60% 70% 80% (Scale: 1 = Very Unlikely 5 = Very Likely) Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 2009 IDC 11
User Surveys Vendor Requirements Q: How important is it that cloud service providers Offer competitive pricing Offer Service Level Agreements (SLAs) ption to move 'cloud' offerings back on premise Provide a complete solution Understand my business and industry Allow managing on-premise & cloud together Support many of my IT needs Offer both on-premise and public cloud services Are a technology and business model innovator Have local presence, can come to my offices 91.6% 88.6% 87.8% 86.0% 84.5% 82.1% 81.0% 79.2% 78.3% 72.9% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% (Scale: 1 = Not at all important 5 = Very Important) Source: IDC Enterprise Panel, 3Q09, n = 263, September 2009 2009 IDC 12
IT Services Forecast Update (preliminary) Worldwide IT Services Revenue* by Product/Service Type Storage 9% Infrastructure Software 20% Servers 12% App Dev/Deploy 10% 2009 $17.4 billion Applications 49% Storage 14% Servers 15% Infrastructure Software 20% Source: IDC, September 2009 Applications 38% App Dev/Deploy 13% 2013 $44.2 billion * Includes revenue from delivery of Applications, Application Development & Deployment Software, Systems Infrastructure Software, Server capacity and Disk Storage capacity via the Services model; AD&D excludes online B2B messaging providers/exchanges 2009 IDC 13
Worldwide IT Spending ($ billion) Services as a % of IT Worldwide IT Spending by Consumption Model 600 500 IT Services On-Premise IT 10% 44 400 5% 17 300 200 359 CAGR 26% 4% 416 100 0 Source: IDC, September 2009 2009 2013 2009 IDC 14
Worldwide IT Spending ($ billion) Services Growth Impact Sources of Incremental IT Spending Growth in 2013 vs. Traditional Products 485 480 475 470 465 460 460.4 27% 73% Net new IT growth = $27.3 billion IT Services growth Traditional IT product growth 455 450 433.1 IT 445 440 435 Source: IDC, September 2009 430 2012 2013 2009 IDC 15
s Position in Asia/Pacific What is your opinion of the current state of cloud computing? It is mostly vendor hype 10% 8% Just renaming of an old concept 17% 18% Too immature at this point to judge Familiarity is high But opinion is low! 22% Interesting concept but would be resisted by my company Very promising but not enough services available 25% A very exciting opportunity Source: IDC Asia/Pacific End-user Computing Survey, 2009, n=667 2009 IDC 16
s Position in Europe Survey: % of respondents in country/region using 7 or more IT cloud services* 14% 12% 10% 8% 6% 4% 2% 0% UK Nordics Germany Spain France Benelux Italy Source: IDC European Enterprise Services Survey 2009, n = 533 * Survey list of cloud services included: email/calendar, financials, app dev, collaboration, CRM, HRM, security, office productivity, storage/backup, app platform 2009 IDC 17
Upcoming IDC Research Plans Landscape Services: Global Overview - NEW Asia/Pacific Services and Technologies - NEW Central and Eastern European, Hosting and Outsourcing Services United States SaaS and Services Spending by Vertical 2009 (special report) - NEW Software/Apps SaaS and Services European SaaS and Services Le Marché du Software as a Service (report - France) Japan SaaS and Services Business Analytics Solutions European Business Analytics Markets & Strategies Software Pricing & Licensing (application) Platform Application Development & Deployment and Services Application Life-Cycle Management 2009 IDC 18
Upcoming IDC Research Plans Infrastructure Enterprise System Management Security Services Security Products Storage Solutions: Storage and the (report series) - NEW Servers in the (special report) - NEW Services around Services SOA and Services: The Professional Services Opportunity WW Consulting & System Integration Services IT Education & Certification ICT Offerings for SPs Datacenter Networks NGN Operations Storage Solutions: Storage and the - NEW Servers in the (special report) - NEW 2009 IDC 19
Essential Guidance Economic benefits of cloud have risen as adoption drivers, tying last year s leading driver: speed of deployment Top concerns remain: security, availability, and performance adoption momentum is strong around collaboration, cloudifying Web commerce, and data backup/archive Core business apps, IT infrastructure services, analytics, and app dev/test/deploy are next in line Top vendor requirements are: pricing; SLAs; dynamism across public cloud, private cloud, and traditional environments; and understanding customers business/industry The recession knocked down cloud adoption forecasts, but less than traditional IT cloud s growth advantage widened in 2009 2009 IDC 20