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Friday, August 26, 2016

Business Leaders Drive Shift to Public Cloud in Europe

Cloud computing adoption is a global phenomena. Line of Business (LoB) leaders are at the forefront. Worldwide revenue from public cloud services will reach over $195 billion in 2020, more than doubling the current market size, according to the latest market study by International Data Corporation (IDC).

Western Europe will continue to represent around a fifth of the global market, with revenues growing from a $15 billion in 2015 to $38.6 billion in 2020, at a 20.8 percent five-year compound annual growth rate (CAGR).

Software as a service (SaaS) -- including the service enablement of applications and system infrastructure software -- accounted for 66.9 percent of all public cloud revenue in 2015, and will continue to represent the largest portion in 2020.

Vendor Go-to-Market Approach Evolves

However, according to the IDC assessment, Platform as a Service (PaaS) and Infrastructure as a Service (IaaS) revenues are forecast to grow at a faster rate than SaaS -- expanding their share of the overall market during the forecast period. Cloud vendors are starting to adapt to this shift in demand from buyers.

"The flexibility, low initial cost, and ease of use provided by cloud deployments is reshaping the way companies select and buy new IT solutions. Line of business managers are gaining a central role in selecting IT providers, and the focus across all industries is on how IT can meet specific business objectives," said Serena Da Rold, senior research manager at IDC.

Market segmentation by informed cloud vendors is proven to result in more effective offers. IDC analysts believe that the savvy cloud service providers will stay close to their target industries, strive to understand their business processes and key pain points, in order to offer clients in each segment the solution and features that meet their specific requirements.

Discrete manufacturing, banking, and process manufacturing are the largest spenders, representing nearly 36 percent of cloud revenues in the region. Utilities, insurance, and discrete manufacturing will see the fastest revenue growth in the region over the next five years. However, all 20 industries tracked by IDC will more than double their cloud spending over the forecast period.

Moreover, public cloud services have changed how European organizations evaluate and select software. DevOps related aspects of cloud adoption -- such as very fast deployments, continuous upgrades, and ease of post-implementation reconfiguration -- are now the top criteria for new application purchases.

European Cloud Services Market Outlook

IT buyers in some European countries have started the adoption of public cloud services later than others, due to concerns related to information security, data location, solution availability, and other issues or concerns.

However, IDC foresees that the public cloud movement will sweep across all of Europe and that some markets of cautious adoption will outgrow the others over the next five years.

In Western Europe, IDC predicts that the U.K. will remain the largest market for public cloud services through 2020, generating nearly 30 percent of total revenue in the region. Germany and France follow in terms of size, with the three largest countries representing collectively around 64 percent of total revenue.

Germany will see the strongest growth over the next five years, followed by some of the smaller countries -- such as Ireland, Sweden, and Switzerland -- which will gradually increase their share of the Western European regional market.

Thursday, August 25, 2016

Global Info Security Spending will Reach $81.6B in 2016

Protecting their organization from new cyber threats continues to be top-of-mind for the vast majority of CIOs. Worldwide spending on information security products and services will reach $81.6 billion in 2016 -- that's an increase of 7.9 percent over 2015, according to the latest market study by Gartner.

Consulting and IT outsourcing are currently the largest categories of spending on information security. Until the end of 2020, the highest growth is expected to come from security testing, IT outsourcing and data loss prevention (DLP).

Preventive security will continue to show strong growth, as many security practitioners will have a buying preference for preventive measures. However, solutions such as security information and event management (SIEM) and secure web gateways (SWGs) are evolving to support detection-and-response approaches. Gartner expects the SWG market will maintain its growth of 5 to 10 percent through 2020 as organizations focus on detection and response.

Enterprise Security Market Development

"Organizations are increasingly focusing on detection and response, because taking a preventive approach has not been successful in blocking malicious attacks," said Elizabeth Kim, senior research analyst at Gartner. "We strongly advise businesses to balance their spending to include both."

According to the Gartner assessment, security spending will become increasingly service-driven as organizations continue to face staffing and talent shortages. That being said, artificial intelligence software and cognitive computing applications will likely alleviate the skills challenge over time.

Managed detection and response (MDR) is emerging, with demand coming from organizations struggling to deploy, manage and use an effective combination of expertise and tools to detect threats, and then bring their environment back to a known good state.

This is particularly true for targeted advanced threats and insider threats. With more MDR providers emerging targeting the midmarket, Gartner foresees these services being an additional driver for security spending for both large and smaller organizations.

Information Security Market Outlook

According to Gartner analysts, investment and spending in security markets such as consumer security software, secure email gateways (SEGs) and endpoint protection platforms (EPPs) continues to show constrained growth due to commoditization.

Furthermore, while software as a service (SaaS) adoption is growing, the effect on firewall spending will be limited for the next three years. SaaS is the first choice for only 16 percent of CIOs surveyed by Gartner in 2015.

Transitions also take time, during which vendors of cloud access security brokers (CASBs) will not only continue to evolve to cover more than just SaaS, but also perform similar roles for infrastructure as a service (IaaS) and platform as a service (PaaS).

In addition, firewall vendors will also have to deal with one of their main challenges for the next few years: decrypting Secure Sockets Layer (SSL) at scale.

Wednesday, August 24, 2016

SDN and NFV Telecom Technologies Gain Momentum

Traditional telecom networking equipment vendors have been preparing for the ongoing transition from hardware-centric business models of the past to a more software-oriented model. Meanwhile, the leading telecom service providers continue to adopt low-cost commodity hardware and open source software.

According to the latest worldwide market study by IHS Markit, 100 percent of the telecom service providers participating in their recent survey say they will deploy Network Functions Virtualization (NFV) at some point, with 81 percent expecting to do so by 2017. Moreover, 59 percent of telecom network operator respondents have already deployed or will deploy NFV this year.

However, integrating NFV into existing networks is an issue for a majority of survey respondents, as is the perceived lack of carrier-grade products. Regardless of these concerns, telecom service providers around the globe are rapidly moving toward NFV, which the latest study by IHS Markit bears out.

NFV and SDN Market Development Progress

The 'NFV Strategies Service Provider Survey' explored plans and strategies for evaluating and deploying NFV solutions. The study identified the drivers for this fundamental change in telecom service provider network architecture, the development stages and deployment timing for key use cases, applications, and target network areas.

These telecom carriers believe that NFV and its software-defined networking (SDN) companion are a fundamental change in telecom network architecture that will deliver benefits in automation; new, more agile services and revenue; operational efficiency; and capex savings.

Both will enable them to follow the lead of progressive service providers, such as AT&T, and thereby dramatically reduce their dependence on the legacy high-cost platforms from established networking vendors.

Many carriers are now moving from their NFV proof-of-concept (PoC) tests and lab evaluations to working with vendors that are developing and productizing the software, which is being deployed commercially.

The perspective toward NFV is changing quickly. In 2014, there was one standout barrier: operations and business support systems (OSS/BSS). In 2015 and 2016, resolving issues with the top barriers -- integrating NFV into existing networks and non-carrier-grade products -- demonstrate that telecom carriers are very serious about deploying NFV.


Exploring NFV Use Case Adoption

According to the IHS assessment, the vast majority of early NFV deployments in the next year will be for business virtualized enterprise customer premises equipment (vE-CPE), also known as vBranch or enterprise vCPE.

Growing in importance over the last several years, business vE-CPE can assist with revenue generation because it allows operators to replace physical CPEs with software so they can quickly innovate and launch new services.

The telecom industry is still in the early stages of a long-term transition to SDN and NFV architected networks. IHS analysts believe that carriers will learn that some avenues are not as fruitful as expected, and telecom equipment manufacturers and software suppliers may well invent new approaches that open up newfound applications.

Tuesday, August 23, 2016

Global Upside Opportunities for New M2M Applications

In the last couple of years machine-to-machine (M2M) has become part of the arsenal of products offered by global telecom service providers and a significant revenue stream for M2M technology specialists. They've developed new value propositions, designed to reduce costs and increase efficiency for their clients.

Meanwhile, new business models are beginning to account for new technology concepts and developments, one of the latest to gain significant market traction being the Internet of Things (IoT).

New technologies, combined with existing ones, are now making the IoT vision a reality. Embedded SIM cards will increasingly dominate the M2M category, accounting for more than 50 percent of connections by the end of the decade, according to the latest study by Juniper Research.

M2M Application Market Development 

Outlined as a market driver in their study findings, the introduction of the GSMA embedded specification is likely to fuel the opportunity for mobile network service providers to offer remote provisioning of SIM cards.

The Juniper report authors also noted that this in turn would greatly enhance the capabilities of telecom operators to update and augment offerings, resulting in the growth of new service subscriptions.

Additionally, Juniper analysts believe that migration to Over The Air (OTA) provisioning would facilitate a range of emerging business models, potentially increasing the lifetime value of M2M subscriptions while also reducing costs.


Their report highlighted the increased benefits that embedded SIMs would offer to customers across an array of established verticals, as remote provisioning would motivate network operators to compete on pricing, functionality and customization capabilities.

Juniper Research has claimed that the reduced cost and flexibility afforded by IoT embedded technology could be instrumental in increasing adoption in key verticals, such as agriculture within developing markets.

"By making M2M affordable, the introduction of the embedded model can in turn allow farmers in regions such as sub-Saharan Africa and developing Asia to increase their yield, boosting crop production and helping to address the rising demand for food," said Sam Barker, analyst at Juniper Research.

Other key findings from the study include:
  • Smart Metering and Connected Car connections will become the majority of all cellular M2M embedded connections over the next 5 years.
  • 3G connections will comprise half of all cellular M2M connections in 2021, due to the need for an affordable and low speed service.
  • Mobile network operators should capitalize on the growth of M2M by offering customizable M2M platforms that offer a variety of simple billing models.

Monday, August 22, 2016

Smart Homes Gain Voice Integration and Control Apps

Some consumer electronics (CE) manufacturers have learned from mistakes of the past. Maybe it was the flashing '12:00' on VCR clocks, or the TV remote controls with 40 near-identical tiny buttons, designers knew we needed better ways to program and control the everyday devices that we use.

Now, on a growing number of CE devices, we can simply use our voice to perform routine tasks. While Apple Siri and Google Now are well-established smartphone features, it's in the emerging smart home that voice control systems will discover their full potential.

Smart TVs, smart refrigerators, smart plugs, and many more devices will extend the reach and simplicity of managing the smart home environment using our voice.

CE Voice Control Market Development

With ABI Research forecasting more than 120 million voice-enabled devices to ship annually by 2021, voice control -- which combines speech recognition and natural language processing -- is becoming the key user interface within the smart home environment.

"Led by success of the Amazon Alexa platform, smart home voice control is creating new competition and demands for wireless speaker and other vendors to include voice capabilities in their devices," said Jonathan Collins, research director at ABI Research.

According to the ABI assessment, the scaling of voice control applications in the smart home breeds complexity. Vendors will need to evaluate how and when to bring voice control into smart home devices, by adding the capability into smart home systems.

New microphone-enhanced products will extend the ability to hear voice commands throughout a smart home environment. These devices will include cameras, doorbells, smart lighting and other residential apps. Savvy vendors are already expanding their product portfolio to support voice listening capabilities.

Outlook for Voice-Driven User Interfaces

But tying multiple listening and voice controlled devices together into a coherent smart home system will require a shared voice platform. So far devoid of any standardization, each of the primary home voice platform providers -- i.e. Apple, Amazon, and Google -- all have their own approaches and ways of leveraging their voice capabilities to extend and support their CE portfolio.

"As more devices support voice control, new voice platforms will increasingly aim to support device and device and service providers," concludes Mr. Collins. "In the past few months, for example, Viv Labs emerged as a company focused solely on extending its voice platform to as many services and devices as possible -- without tying it to a sub-strategy of boosting the appeal of a separate core business."

Friday, August 19, 2016

Blockchain: Enable Faster and More Secure Transactions

The emergence of Bitcoin and other alternative cryptocurrency options has the potential to significantly impact the Global Networked Economy. During the last couple of years, huge amounts of these new currencies have been traded on the dedicated exchange platforms that already launched.

Meanwhile, some merchants accept Bitcoin as a payment method. And, numerous banks are now trialing the technology as a means of reducing settlement costs, while a host of other use cases -- as an example, smart contracts and secure ID verification -- are also seeing their first deployments.

Blockchain Technology Market Development

A new worldwide market study by Juniper Research has found that the total value of Venture Capital (VC) investment into blockchain technologies and Bitcoin companies totaled $290 million in the first 6 months of 2016, with more than thirty startups receiving funding during that time.

More than a third of all VC investment was accounted for by three companies: Circle - the social payment provider; Blockstream - the sidechain developer; and Digital Asset holdings - the distributed ledger solutions provider.

The resulting Juniper research report -- The Future of Blockchain: Bitcoin, Remittance, ID Verification and Smart Contracts 2016-2021 -- highlighted the increasing diversification of nascent blockchain deployments, with applications ranging from identity to asset management.


It pinpointed the banking sector as being particularly proactive, with several banks having already adopted the Ripple blockchain protocol and others piloting competing solutions.

The market research highlighted that in areas such as transaction settlement, the introduction of a blockchain-based system would substantially reduce both the risk of error and the time taken for error checking.

Furthermore, it argued that in cross-border remittance, the technology could allow new entrants to offer financial services at significantly lower costs to consumers.

Outlook for Blockchain Technology Advancement

However, the analyst research findings also cautioned that if smart contracts use blockchain technology, then their contents -- including bugs or flaws -- are visible to all the users of that blockchain.

The Juniper analyst assessment cited the recent case where a flaw on the DAO (Decentralised Autonomous Organisation) network was exploited by a third party, resulting in the misappropriation of crypto-currency worth nearly $80 million.

"While blockchain technology offers the potential for increased speed, transparency and security across an array of verticals, there has to be rigorous and robust testing in each unique use case before any decision is taken," said Dr Windsor Holden, head of forecasting and consultancy at Juniper Research.

Thursday, August 18, 2016

AR/VR Market will Grow to Reach $162 Billion in 2020

The occupational use of new video technologies is about to transform the way that many people perform their daily work. As an example, augmented reality is the blending of virtual reality and real life. Software developers can create video images within applications that enhance our experience in the real world.

Worldwide revenues for the augmented reality and virtual reality (AR/VR) market will grow from $5.2 billion in 2016 to more than $162 billion in 2020, according to the latest market study by International Data Corporation (IDC). This represents a compound annual growth rate (CAGR) of 181.3 percent over the 2015-2020 forecast period.

New Applications Drive Market Development

Sales of AR/VR hardware will generate more than 50 percent of worldwide revenues throughout the forecast period. AR/VR software revenues will grow more than 200 percent year over year in 2016. However, services revenues will overtake software in the middle years of the forecast, as logistics and manufacturing demand enterprise-class support.

Revenues for VR systems, including viewers, software, consulting services and systems integration services, are forecast to be greater than AR-related revenues in 2016 and 2017, largely due to consumer uptake of games and paid content.

After 2017, commercial applications and associated AR revenues will surge ahead, reaching a critical mass in healthcare delivery, product design and management-related use cases.

"For many years augmented and virtual reality were the stuff of science fiction. Now with powerful smartphones powering inexpensive VR headsets, the consumer market is primed for new paid and user generated content-driven experiences," said Chris Chute, vice president at IDC.

Meanwhile, recent developments in healthcare apps demonstrated the powerful impact augmented reality headsets can have, and over the next five years IDC expects to see that promise become realized in other fields -- such as education, logistics, and manufacturing.

IDC analysts believe that the rise of less expensive hardware will put virtual and augmented reality technology within the grasp of developer ecosystems that can drive market development. As always, what people can do with that hardware will depend upon the practical software applications.

Rapidly Evolving AR/VR Market Outlook

In the coming years, according to the IDC assessment, developers will create a wide range of new experiences for these AR/VR devices that will fundamentally change the way many of us do work.

From a regional perspective, Asia-Pacific (excluding Japan), the United States, and Western Europe will account for three quarters of worldwide AR/VR revenues.

The three regions will generate comparable revenue amounts in 2016, but the United States is forecast to pull well ahead of the other two regions by 2020. Because AR/VR technology is still in the early stages of adoption, all regions will see annual growth of more than 100 percent throughout the forecast period.

Wednesday, August 17, 2016

Ultra High-Definition TV will Reach 189 Million Viewers

The digital TV and video entertainment market will expand via online and mobile delivery of new media. This new growth will be driven by network operator owned services, such as Internet Protocol Television (IPTV), or through Over The Top (OTT) video streaming services such as Amazon Prime, Netflix and Hulu among others.

Meanwhile, traditional pay-TV operators and terrestrial over-the-air TV broadcasters will continue to be disrupted by new digital technologies and new business models. Furthermore, the impact of the ongoing video entertainment transformation could also create new challenges for the Cinema theater sector.

According to the latest market study by Juniper Research, ultra high-definition television (UHDTV) streaming video services -- i.e. 4K OTT -- content will start to reach the mainstream market soon, with adoption set to soar over the next 5 years.

How Connected TV Fueled the Disruption

Note, 4K is a term that was originally used to describe the cinema projection resolution of 4096 x 2160 and a cinema aspect ratio of 21:9 on the screen. In fact, many theaters across the world have already shown digital movies in 4K resolution.

Juniper’s latest study found that 4K OTT video services are now forecast to attract over 189 million unique users globally by 2021 -- that's up from just 2.3 million this year, driven by greater content availability and compatible devices.

In the U.S. market, this means that 1 in 10 residents will be watching 4K online compared with just 1 in 500 this year. While connected TV will likely still be the dominant presentation channel, viewership will take place through a range of devices -- including smartphones, media tablets, and PCs.


4K Content Market Development Challenges

The new research found that although YouTube, Netflix and Amazon already offer some 4K video, TV network providers have been waiting for a critical mass of content to become available before launching their own 4K offer.

However, during 2016 a number of new 4K offerings have been introduced, such as the launch of the Sky Q 4K service in the UK market, coupled with new hardware launches to provide a means of streaming online 4K content. Indeed, device compatibility in the past has proved to be a significant barrier for online 4K video.

"The popularity of online video has seen the use of set-top boxes from vendors such as Roku and Amazon soar. However, delivery mechanisms for content have seen slower adoption, as the availability of 4K capable streaming devices is limited," said Lauren Foye, analyst at Juniper Research. "New device launches, such as the 4K capable Xbox One S this month, among others, are likely to spur a boost in 4K usage."

Vendors Prepare for 8K Video Introduction

While there is one commercially available 8K TV currently on the market (priced at $133,000), 8K content is a long way from becoming mainstream. In a similar scenario to 4K, Juniper Research anticipates 8K smart TVs emerging first, followed by streaming devices and set-top boxes, making this relatively slow market development process.

With Japan seeking to broadcast the 2020 Olympics in 8K, the video industry is likely to use this as an opportunity to drive sales of 8K smart TVs. Juniper forecasts that 8K smart TV shipments will grow more than threefold between 2020 and 2021 -- to reach over 400,000 per year by the end of the forecast period.

Tuesday, August 16, 2016

Total Global IoT Revenue to Reach $3 Trillion by 2025

Current estimates of the commercial impact from the Internet of Things (IoT) market opportunity are already being rated in the billions and trillions. Machina Research recently published its annual guidance on the growth of the global IoT market, adding more data and insight to the future projections.

China and the U.S. will compete for dominance of the global market by 2025. China, which will account for 21 percent of global IoT connections, will be slightly ahead of the U.S. 20 percent IoT connections share, with similar growth proportions for cellular connections.

However, the U.S. market will lead in terms of IoT revenue over China -- 22 percent vs 19 percent. Furthermore, the third largest market is forecast to be Japan with 7 percent of all connections, 7 percent of cellular connections and 6 percent of the global revenue.

The total IoT revenue opportunity will be $3 trillion in 2025 -- that's up from $750 billion in 2015. Of this figure, $1.3 trillion will be accounted for by revenue directly derived from end users in the form of devices, connectivity and application revenue. The remainder comes from upstream and downstream IoT-related sources such as application development, systems integration, hosting and data.

Machina analysts forecast that IoT will generate over 2 zettabytes of data by 2025, mostly generated by consumer electronics devices. However it will account for less than 1 percent of the global total cellular data traffic. Moreover, cellular traffic will likely be generated by digital billboards, in-vehicle connectivity and CCTV.

Other key findings from the market study include:

  • The total number of IoT connections will grow from 6 billion in 2015 to 27 billion in 2025, a CAGR of 16 percent.
  • Today 71 percent of all IoT connections are connected using a short range technology (e.g. WiFi, Zigbee, or in-building PLC), by 2025 that will have grown slightly to 72 percent.
  • The big short-range applications, which cause it to be the dominant technology category, are Consumer Electronics, Building Security and Building Automation.
  • Cellular connections will grow from 334 million at the end of 2015 to 2.2 billion by 2025, of which the majority will be LTE.
  • Forty-five percent of those cellular connections will be in the Connected Car sector, including both factory-fit embedded connections and aftermarket devices.
  • Eleven percent of connections in 2025 will use Low Power Wide Area (LPWA) connections such as Sigfox, LoRa and LTE-NB1.

Market Development of IoT Technologies

"Through our regular ongoing work in IoT, we are constantly monitoring hundreds of different constituent applications across every country and adjusting our outlook for each. Every year we take a snapshot of the IoT market, pulling our latest forecasts to examine how the overall market had developed in the year," said Matt Hatton, CEO at Machina Research.

According to the Machina assessment, this year the top line connections and revenue growth estimates demonstrate that the upside opportunity is substantial. However, not all the vendors rushing into this emerging market opportunity will reap the rewards.

To fully take advantage of the opportunities in IoT, Machina analysts believe that technology suppliers need to understand the key market dynamics and their competitive environment, and then develop best practices for market development.

Monday, August 15, 2016

Global IoT Platform Revenue will Grow to €3B by 2021

The global third party Internet of Things (IoT) platform market increased by 36 percent to € 610 million in 2015, according to the latest worldwide market study by Berg Insight. Growing at a compound annual growth rate (CAGR) of 30.8 percent, revenues are now forecast to reach € 3.05 billion in 2021.

There's a wide range of software platforms available. They're intended to reduce cost and development time for IoT solutions, with standardized components that are shared across many verticals to integrate devices, networks and applications.

Most of these IoT solutions can be categorized as being a connectivity management platform, a device management platform or an application enablement platform. Although, there are many IoT-related products that offer overlapping functionality.

IoT Application Market Development

Many organizations have already been involved in various machine-to-machine (M2M) deployments that have been characterized by custom solutions deployed within single verticals -- or by one company -- to improve existing operations.

IoT deployments typically put more emphasis on the integration of sensors, devices and information systems across industry verticals and organizations to transform operations and enable new business models.

"IoT furthermore aims to facilitate a better understanding of complex systems through analytics based on data from diverse sources to assist decision making, improve products and enable entirely new services," said André Malm, senior analyst at Berg Insight.

Whereas connectivity and device management platforms have already reached comparatively high adoption, the market for application enablement platforms (AEPs) is in the early-adopter phase. AEPs typically provide functionality such as data collection, data storage and analytics.

According to the Berg Insight assessment, fully featured platforms also provide tools, frameworks and APIs for creating business applications featuring data management, event processing, automated tasks and data visualization.

More IoT Tools for Developers

Many platforms also provide tools and ready-made libraries and UI frameworks that facilitate modelling and creation of interactive applications, work spaces and dashboards with little or no need for software coding. The AEP segment is seeing considerable activity, in terms of vendor acquisitions and new market entrants.

After PTC acquired ThingWorx and Axeda, other major software and IT companies have followed. Examples include Amazon that acquired 2lemetry, Autodesk that acquired SeeControl, and Microsoft that acquired Solair.

Other leading IT companies that are extending their service offerings to include IoT platforms -- often focusing on analytics and machine learning capabilities -- include IBM, SAP and Oracle.

"As a group, AEP vendors primarily face competition from system integrators and companies that develop similar functionality in-house," concluded Mr. Malm.