Technology | Media | Telecommunications

Friday, February 27, 2015

How Cloud Computing Service Management is Evolving

Cloud service management is going to become yet one more segment of the legacy enterprise software sector that's being affected by the ongoing adoption of open-source software subscription models.

The shift in end-user IT consumption preference to cloud services will trigger disruption and pressures old-school Infrastructure Management (IM) software vendors on two fronts, according to the latest market study by Technology Business Research (TBR).

Cloud consumption models rely on subscription revenue. The revenue recognition patterns for subscriptions are in stark contrast to the expensive software vendor license models that include ongoing maintenance support agreements, generally purchased after the first year of deployment.

The shift to subscription models negatively impact margins as traditional IM software vendors shift go-to-market and delivery strategies to align with end-user consumption preferences -- and the growing demand for a lower-cost IT operations model.

Forward-Thinking Cloud Management Platforms

Second, the underlying technology required to manage cloud environments is vastly different from the historical management software products sold on a license basis by legacy vendors -- such as Computer Associates (CA) and BMC.

Traditional vendors such as CA and IBM Software have to rethink how they sell and deliver these products while stitching together the IP assets necessary to manage and monitor cloud infrastructures.

Overall IM revenue grew 3.7 percent year-to-year for the 22 vendors covered in the TBR Infrastructure Management Software Vendor Benchmark, with average IM operating margin of 22.3 percent for those firms.

"How well vendors manage license erosion while ramping-up subscription revenue streams and the requisite product extensions for cloud infrastructure will be a story played out in 2015 and beyond," said Geoff Woollacott, practice manager at TBR.

He believes that this year is a tipping point for accelerated cloud adoption -- and the concomitant business model destruction for traditional legacy suppliers. End-customer consumption model preferences remain difficult to forecast accurately due to their continued evolution.

"TBR decided to subgroup our benchmark analysis given the different rates of change these vendors may experience going forward in this turbulent time in our industry," said Woollacott. "We look forward to extending the benchmark analysis in subsequent quarters as the transformation impacts become clearer through the business model analysis."

Thursday, February 26, 2015

Augmented Reality and Virtual Reality Market Upside

​The augmented reality (AR) and virtual reality (VR) markets are experiencing increased growth potential, from new devices and new content, to existing content that's being adapted to make use of the emerging communication medium.

According to the latest market study by ABI Research, head mounted displays (HMDs) will be the prevailing form-factor for both AR and VR devices. That said, AR will see varied form-factors as the technology progresses into more diverse user applications.

"Among the three categories of devices -- which are standalone, mobile-reliant, and tethered -- mobile-reliant devices such as the Samsung Gear VR will see the most success early," said Eric Abbruzzese, research analyst at ABI Research.

Meanwhile, tethered devices such as the Oculus Rift -- and standalone devices like those manufactured by ODG for industrial applications -- will need more time to mature before establishing a large user base.

Virtual reality will be most popular in the gaming market, because of the high level of immersion possible in VR, as well as the high demand for interactive experiences.

Augmented reality will be most successful in the enterprise market, for applications in logistics, engineering, and automotive. Applications such as education, travel, and design are served well by both AR and VR, and success depends more on specific needs than general application.

New content mediums, such as interactive VR video, are becoming more popular and catching the attention of content creators as a potentially viable medium.

Existing software solutions, such as CAD software, can be outfitted to support AR and VR devices, and open a new approach to using the software. As the market grows, major content networks such as sports networks and video creators will start supporting AR and VR devices, and more consumers will migrate to the market.

There is a lot of excitement and hype focused on getting consumers to try out virtual reality, including the LG G3 shipping with an HMD in some markets, and the Mattel View-Master AR toy.

These early experiences will be like any new toy-novel for a while and then fall off in use, with new content potentially driving periodic re-engagement.

According to the ABI assessment, for true breakthrough products to be embraced, technology, usability, and content must meet at the critical time. For AR & VR, the inflection isn't likely to occur until 2016.

Wednesday, February 25, 2015

Why Cloud Brokerage Hasn't Gained Much Adoption

Cloud service brokerage market development is still in the early stages. A recent survey of enterprise cloud adopters showed a near even three-way split between adopting, considering or not planning to adopt brokerage services, according to the latest market study by Technology Business Research (TBR).

TBR believes that as things stand today in the marketplace, there is a global lack of education pertaining to the solutions available and benefits or outcomes of cloud computing brokerage adoption by forward-looking IT organizations.

Moreover, as vendors are still making decisions regarding their participation within the cloud brokerage market, TBR anticipates it will be a few years before the brokerage concept reaches mainstream status within the typical IT organization globally.

"It seems enterprises are adopting brokerage services mostly to have a third-party perform their cloud integration and management tasks, either because they want their IT departments to focus on higher-level, business outcome driving tasks or they recognize they cannot or do not want to manage cloud sprawl," said Cassandra Mooshian, Cloud Analyst at TBR.

TBR says that it is interesting though, that the majority of those who adopt cloud brokerage do not do so such that they can free up resources to adopt more cloud solutions.

Rather, most survey respondents say they're adopting brokerage to optimize their current cloud solutions, which is not necessarily good news for traditional cloud vendors.

TBR surveyed 318 end users of cloud services (private, public, hybrid and/or professional services) at enterprises across North America, Europe and Asia to provide insight into adoption, perceptions and future trends in the cloud brokerage market.

The survey found cloud computing brokerage is not as likely to drive additional cloud sales as originally anticipated, creating a challenge for cloud brokers to overcome.

IBM is the clear market leader for enterprise cloud brokerage adoption, with an adoption rate that is more than double that of any other cloud broker, according to the report.

IBM is perceived as best meeting customer demands for brokerage services and has adequately built its brokerage portfolio and messaging such that customers are educated around what IBM has to offer and confident it can deliver on its messaging.

Furthermore, IBM and Capgemini, two systems integrators (SIs) with rooted consulting and systems integration (C&SI) capabilities, top vendor adoption lists, while niche cloud services providers and brokers are beginning to gain traction as the next level of brokerage services become more sought after.

Aside from IBM and some smaller vendors, many vendors have not delivered to the extent they message their portfolios, while others have not adequately promoted their brokerage capabilities, making it more difficult for customers to make informed decisions.

Tuesday, February 24, 2015

African Mobile Telecom Investment Boosts the Economy

A positive economic growth outlook for Africa is strongly dependent on improved institutional performance and better governance. GDP growth in Africa in 2015 is forecast at 4.4 percent.

Nigeria will be the strongest performer at 6.7 percent growth in 2015, but heavily dependent on natural resources and vulnerable to global demand. Telecom services, and mobile internet access in particular, could help boost the economy.

That said, the Nigerian telecommunications market is expected to generate $10.9 billion in 2019, that's up from a total of $9.2 billion in 2013, according to the latest market study by Pyramid Research.

Although growth in the market will be slightly reduced in 2015, as the market recovers from the large number of fixed-line disconnections, long-term growth of the telecommunications sector will not to be affected.

Nigerian Telecom Market Outlook

The telecoms market will grow at a Compound Annual Growth Rate (CAGR) of 2 percent over the next five years, with mobile data increasing at 16 percent up until 2019.

"Political instability and low oil prices have led to a depreciation of the Naira against the U.S. Dollar, but the telecommunications market will remain an integral part of the country’s efforts to diversify its sources of growth," said Severin Luebke, analyst at Pyramid Research.

Although currency devaluations are likely to result in slower U.S. Dollar growth rates, in local currency terms, the Nigerian telecommunications market offers strong growth rates of around 6.8 percent per year for the period between 2014 and 2019.

Nigeria is the Largest Mobile Market in Africa

With an expected 182 million subscribers at the end of 2019, Nigeria will remain the biggest market for mobile communication subscription on the African continent, according to the Pyramid assessment.

Nigeria is the largest economy in Africa and therefore will play an important role in defining future mobile trends.

"Other countries in Africa are likely to follow Nigeria when it comes to mobile technology developments. The increasing demand for mobile data will offer service providers, as well as new entrants to the market, ample opportunity to test and grow their service offerings in Nigeria," concludes Luebke.

Monday, February 23, 2015

Cloud Services will Disrupt the Videoconference Market

Online collaboration, and videoconferencing in particular, has been a significant catalyst for business productivity during the last decade. However, the demand for expensive telepresence systems and traditional room-based videoconference installations has reached its pinnacle.

Enterprise videoconferencing infrastructure and endpoint hardware revenues are forecast to be relatively flat through 2020 -- growing slightly at a 2.1 percent CAGR -- according to the latest worldwide market study by ABI Research.

Software solutions are becoming a more popular choice, with the ability to extend existing infrastructure and endpoints and lessen the need for installing new permanent hardware.

"With the current market focus on cloud computing and hardware virtualization, dedicated hardware sales will see little growth in all video delivery markets, including videoconferencing and telepresence hardware,” said Eric Abbruzzese, research analyst at ABI Research.

According to the ABI assessment, hardware-focused companies -- such as Cisco, Polycom, and Avaya -- will have difficultly seeing success in both infrastructure and endpoint sales if their products do not adapt to the virtualization-focused markets.

Each of these companies have already begun the transition, with their own cloud videoconferencing platform aimed at leveraging their existing products as the foundation for the new service.

The Asia-Pacific region -- more specifically China -- is forecast for stronger growth through 2020 (5.3 percent for infrastructure and 4.3 percent for endpoint), likely due to non-China based companies continuing to conduct business in China and require strong videoconferencing platforms.

ABI believes that consumer videoconferencing is continuing to see strong growth, with products such as Skype, ooVoo, and Google Hangouts expanding their global user base. Moreover, these free or low-cost services have already gained adoption in many businesses across the globe.

Small businesses, not interested in investing in large, permanent hardware solutions for videoconferencing, have the potential to instead choose these consumer-focused solutions, as they offer similar features to enterprise solutions.

With virtualization, newer companies -- such as Blue Jeans and Vidyo -- are able to offer fully featured, enterprise-focused services without the need for dedicated infrastructure and endpoints. Besides, new users of these services can start with little or no investment in video equipment.

Friday, February 20, 2015

Mobile Internet Traffic is Advancing LTE Deployments

Mobile communication network infrastructure is a proven catalyst for economic growth. Therefore, more nations have assigned and auctioned radio spectrum to accommodate anticipated traffic that results from increasing mobile internet usage.

4G LTE-Advanced networks have been actively deployed around the world, according to the latest global market study by ABI Research.

At the end of 2014, LTE-Advanced covered its first 100 million people worldwide -- that's just 4 years since the network technology inception.

ABI Research predicts that the coverage will reach 1 billion mobile subscribers in 4 more years. At the end of 2014, there were 49 commercially available LTE-Advanced networks around the world.

Western European operators lead the commercialization with 20 operators, followed by 13 in Asia-Pacific; however, North America still commands the largest population coverage at 7.8 percent.

"All four major operators of the United States have either commercially deployed (AT&T and Sprint) or have been actively deploying (Verizon and T-Mobile) their LTE-Advanced networks," said Lian Jye Su, research associate at ABI Research.

Globally, a number of major auctions are expected to take place in several major markets during 2015.

The Telecom Regulatory Authority of India has just recently confirmed a LTE spectrum auction on the 25th of February. In France, the government has recently approved the reassignment of the 700 MHz band for telecom services.

When mobile service adoption becomes more saturated in a market, the greater the demand for incremental infrastructure seems more urgent. As an example, the FCC is currently conducting an auction for AWS-3 spectrum in the United States.

As heavy subscriber data traffic growth has exploded, ABI Research anticipates fierce competition for more spectrum, as well as an active migration to VoLTE -- and higher data modulation schemes such as LTE and LTE-Advanced, which has higher spectral efficiency.

Thursday, February 19, 2015

Smart Grid Initiatives Reach $10.7B Savings Annually

What strategies are being employed in leading smart cities? What are the key trends shaping the smart city landscape? And, what is the value of cost savings that can be expected from smart city projects? These are the questions that were asked during a new global market study, and an assessment of the resulting findings.

Juniper Research has revealed the top ranking Smart Cities globally for 2015. They are (in order of rank), Barcelona, New York, London, Nice and Singapore.

The Juniper Smart City Rankings have been compiled following an analysis of the Smart capabilities offered in each city, with particular focus on their use of smart grids, smart traffic management and smart street lighting.

Furthermore, the ranking considered other aspects of a Smart city -- such as technological capability and social cohesion, among others.

It was found that the leader, Barcelona, performed consistently well across all metrics and serves as an exciting model of success from which others can learn, bolstered by strong environmentally sustainable initiatives.

Other leading cities, such as New York and London, still require greater emphasis on implementing environmentally positive projects, despite excelling in areas such as technological capability and a willingness to engage with citizens through open data.

The Global Call for Smarter Grids

Juniper’s latest worldwide market study has found that smart grid initiatives will achieve $10.7 billion savings annually by 2019, through a combination of reduced energy consumption and emissions reductions in smart cities.

According to Juniper's assessment, the reduced emissions are equivalent to those produced by the annual consumption of 130 million barrels of oil.

The study also found that, despite substantial differences in energy market regulation and policy, there is a strong desire on a global scale to implement a smarter grid.

National energy concerns, caused by emissions reduction policies, transmission line loss and grid reliability are among the numerous drivers behind the need to transition to a 2-way electricity transmission grid.

"Issues such as grid cybersecurity and winning over the consumer where smart metering is concerned still need to be addressed," said Steffen Sorrell, research analyst at Juniper Research. "Education is key, certainly in terms of stakeholder information sharing as well as promoting the full benefits of a smart grid beyond a vague notion of a reduction in energy bills."

Wednesday, February 18, 2015

Mobile Cloud Applications will Realize Epic Growth

The ongoing adoption of more powerful mobile devices and machine-to-machine (M2M) connections are key contributors to significant mobile data traffic growth, according to the latest annual update of the Cisco Visual Networking Index (VNI) Global Mobile Data Traffic Forecast.

In 2014, 88 percent of global mobile data traffic was considered Smart traffic, with advanced computing or multimedia capabilities and a minimum of 3G connectivity, but that figure is expected to rise to 97 percent by 2019.

The worldwide shift to smartphones -- combined with the continued growth in media tablets, as well as expanding machine-to-machine (M2M) wireless applications -- are key factors supporting the increasing Smart traffic trend.

From a global mobile network perspective, 3G is expected to surpass 2G as the top cellular technology, based on connection share, by 2017.

By 2019, 3G networks will support 44 percent of global mobile devices and connections; 4G networks will support 26 percent of connections, though will generate 68 percent of traffic.

The updated market study also projects that global mobile data traffic will reach an annual run rate of 292 exabytes by 2019 -- that's up from 30 exabytes in 2014.

"The ongoing adoption of more powerful mobile devices and wider deployments of emerging M2M applications, combined with broader access to faster wireless networks, will be key contributors to significant mobile traffic growth in the coming years," said Doug Webster, Vice President of Service Provider Products and Solutions Marketing at Cisco.


Rapid Growth of Mobile Cloud Traffic

Cloud applications and services such as Netflix, YouTube, Pandora, and Spotify allow mobile users to overcome the memory capacity and processing power limitations of mobile devices.

Besides, the ongoing adoption of enterprise mobility applications will be a significant factor in the rapid growth of mobile cloud traffic during the forecast period. Mobile cloud traffic will grow nearly 11-fold from 2014 (2 exabytes/month) to 2019 (21.8 exabytes/month).

In 2014, cloud applications accounted for 81 percent of total mobile data traffic; by 2019, cloud applications will account for 90 percent of total mobile data traffic.

Key Regional Growth Projections

In terms of mobile data traffic growth rates over the forecast period, the Middle East and Africa region is projected to have the highest regional growth rate. Below is how each of the regions ranks in terms of growth rate by 2019:

  • The Middle East and Africa will have a 72 percent CAGR and 15.3-fold growth
  • Central and Eastern Europe will have a 71 percent CAGR and 14.4-fold growth
  • Asia-Pacific will have a 58 percent CAGR 9.7-fold growth
  • Latin America will have a 59 percent CAGR and 10.1-fold growth
  • North America will have a 47 percent CAGR and 6.8-fold growth
  • Western Europe will have a 48 percent CAGR and 7.1-fold growth

See how the rapid evolution of mobile services to a virtualized cloud computing environment creates more than $500 billion in new opportunity by 2019. Find out more by using the Cisco Monetization and Optimization Index (MOI). It enables you to forecast your specific market in cloud, mobile or video services.

Tuesday, February 17, 2015

Managing the Identity of Things in the Emerging IoT

Security is top of mind for most CIOs, and for good reason. Moreover, the emergence of new and pervasive technologies will present unique security challenges. A case in point: managing identities and access is going to become very important in the evolving Internet of Things (IoT).

However, the current form of Identity and Access Management (IAM) cannot provide the scale or manage the complexity that the IoT brings to the enterprise, according to the latest market study by Gartner.

"IAM leaders must reconsider how traditional approaches to cyber-security and IAM work in a world where devices and services are so abundant, in so many different forms and positioned at so many different points within the IT ecosystem," said Earl Perkins, research vice president at Gartner.

The growth of these technologies means that today's digital businesses must now require a way of defining and managing the identities of entities -- people, services and things -- within a single, secure framework.

Gartner believes that the IoT is not only about the introduction of different forms of networked devices into digital business moments -- it's a transformational approach to viewing and implementing processing, analytics, storage and communications.

The Identity of Things (IDoT) is a new extension to identity management that encompasses all entity identities, whatever form those entities take. These identities are then used to define relationships among the entities -- between a device and a human, a device and another device, a device and an application or service, a human and an application or service.

Since devices have not traditionally been part of IAM systems in this way, Gartner says that the IDoT must draw upon other existing management systems to aid in developing the single-system view for the IoT.

IT Asset Management (ITAM) and Software Asset Management (SAM) systems have traditionally managed IT and software assets of all types. The IDoT will assume some functional characteristics of ITAM and SAM within or integrated with IAM architecture, or be linked to ITAM as attribute stores.

"Existing identity data and policy planning give IAM leaders and technology service providers a narrow view of entities leading to a static approach that does not consider the dynamic relationships between them," concludes Perkins.

However, the concept of dynamic relationships is vital to the success of future IAM solutions. In fact, the concept of the relationship will become as important as the concept of identity is for IAM in the IDoT. It allows the IDoT to exist and become part of new responsibilities for IAM within the enterprise.

Monday, February 16, 2015

Software Impact on Wearable Device Market Outlook

Attractive design will always be important, but software development is now a leading factor in the ongoing adoption of wearable devices. Over 720,000 Android Wear devices shipped in 2014 out of a total of 4.6 million smart wearable bands, according to the latest worldwide market study by Canalys.

Motorola was the clear leader among Android Wear vendors. The LG round G Watch R performed significantly better than its original G Watch, while Asus and Sony entered the market with their own Android Wear devices.

Pebble meanwhile shipped a total of 1 million units from its 2013 launch through to the end of 2014. Continual software updates, more applications in its apps store and price cuts in the fall helped maintain strong sales in the second half of the year.

"Samsung has launched six devices in just 14 months, on different platforms and still leads the smart band market. But it has struggled to keep consumers engaged and must work hard to attract developers while it focuses on Tizen for its wearables." said Chris Jones, VP and principal analyst at Canalys.

Following a completely different strategy to other vendors, Xiaomi shipped over a million units of its Mi Band, the colorful and affordable basic band. This included one day of sales of over 103,000 units.

Even though the Mi Band is a lower-margin product than competing devices, Xiaomi entered the wearables market with a unique strategy, and its shipment volumes show how quickly a company can become a major force in a segment based solely on the size of the Chinese market.

Meanwhile, Fitbit remained the global leader in the basic wearable band market.

Canalys believes that all eyes are now on Apple, which will reveal further details about the Apple Watch prior to its release in April. It's anticipated that the product will dramatically grow the market for smart bands and wearables overall.

According to the Canalys assessment, Apple made the right decisions with its WatchKit software development kit to maximize battery life for the platform, and the Apple Watch is expected to offer superior energy efficiency.