Indian IT spending to reach 1093 billion rupees in '06

BANGALORE

- - In its latest predictions, Gartner projects that total Indian enterprise IT

spending (not including consumer IT spend), including hardware, software,

telecommunications and IT services, will reach 1093 billion rupees in 2006

growing at a CAGR of 20.8 percent from 04 to 09.

India can expect to see an

annual enterprise ICT spending growth rate (AGR) of 23 percent in 2006, with 739

billion rupees being spent on telecommunication services and equipment (a 27

percent increase over 2005), 172 billion rupees spent on hardware (a 13 percent

increase over 2005), 141 billion rupees on IT services (a 22 percent increase

over 2005) and 41 billion rupees on software (at 17 percent increase over 2005).

Gartner has projected that

total global enterprise ICT spending (excluding internal IT spend on salaries

etc) will reach US$1768 billion in 2006, and is growing at a CAGR of 4.5 per

cent from 2004 through 2009. By contrast, enterprise ICT spending in Asia

Pacific will reach almost US$210 billion in 2006, with a CAGR of 7.5 per cent

over the same period.







Announcing the top ten trends and predictions

for 2006, Gartner said the impact of consumer technologies on enterprise IT will

continue to spread rapidly, despite attempts to slow them down or policies

designed to discourage their use. Gartner predicts that between 2006 and 2012

the majority of new information technologies adopted by enterprises will have

their roots in the consumer market.







"Many technologies have in the past been

introduced and have found acceptance in consumer markets, only to be ignored by

enterprises," said Dion Wiggins, vice president and research director at

Gartner.

"Dismissing

graphical user interfaces as toys and the Internet as 'not ready for prime time'

are classic examples. The trend continues today with technologies such as

Instant Messaging and games and in the future Web 2.0. If history repeats

itself, we are ignoring important technologies today that will have enterprise

impact in the future," added Wiggins.






Consumer technology earmarked for enterprise adoption includes 3D graphics, rich
media and consumer-oriented Web sites - such as Amazon, eBay and Google - that

are emerging as platforms capable of delivering services to support business

processes.

"This trend is being

driven faster and further in Asia Pacific which is both the major producer of

consumer technology and, in certain parts of the region, highly tech-savvy. We

expect to see increasingly innovative design and business models emerge in Asia

as we move along the trend line of 'sold in Asia' to 'made in Asia' to 'designed

in Asia' to 'dreamt up in Asia'," said Wiggins.

Some

of the other

predictions of Gartner forecast

include:

Asian

development and protection of IP

Across Asia Pacific IT

development is coming of age and Gartner sees Asian companies leading

development in most areas of consumer technology, mobile and broadband content

and associated business models.  The region will, however, lag in the

development of enterprise applications. The rapid maturing of IT development in

China and India will see trade between the two explode and result in firms

gaining competencies that can be applied across emerging markets globally.

"As research and

development across the region gears up we see intellectual property protection

following suit. The percentage of GDP spent on R&D is rising rapidly,

particularly in China, toward OECD levels and technology/IP value chains are

emerging. This will provide the incentive for Asian companies with multinational

intent to put additional pressure on governments to enforce IP protection and

support IP creation at home," said Wiggins.

Open

Source Software

Running counter to the

traditional software business model based on IP, Gartner also sees open source

software (OSS) competing directly with commercial software in many segments of

the enterprise market and taking on an expanded role in the small-to-medium

business sector. With OSS adoption rising rapidly, particularly in China and

India, Gartner believes that by 2010 it will account for 20 per cent of the

global software market, displacing over US$100 billion in revenues from

traditional software vendors.







Dealing

with information overload

Gartner has also identified a

rising requirement for Enterprise Information Management (EIM), driven both by

the need for process simplification and operational efficiency, and by

enterprise agility and competitive differentiation. It predicts that, by 2015,

enterprises will have to deal with 30 times more data than in 2005 and therefore

strong competence in data management, metadata and analytics will be a very

significant differentiator.

 To

cope with the increasing volume and velocity of information, organisations will

need to adopt "Real Time Infrastructure" (RTI) which relies

extensively on virtualisation.  Now being adopted on x86 servers,

virtualisation can improve IT resource utilisation and increase flexibility in

adapting to changing requirements and workload. With the addition of

service-level, policy-based automation, virtualisation leads to RTI according to

Gartner.

 Linked

to this trend, the strategic impact of Service Oriented Architecture (SOA) and

Web services will broaden, with increasing emphasis on business process driving

adoption of the "Business Process Platform". Gartner sees

multi-product vendors combining middleware with an extensive set of

software-as-services and knowledge-based assets to provide composition

portfolios from which composite applications can be implemented.







Evolution

of Outsourcing

As global outsourcing evolves

to "multisourcing" based on utility-style IT services, components for

composite application in a SOA environment can come from external service

providers as well as in-house sources. Gartner believes that organisations that

figure out how to "do multisourcing" will win and predicts that

through 2008 more than 50 per cent of new outsourcing deals will have an IT

utility services component.

In line with the evolution of

IT from a product to a service model, Gartner analysts believe the IT profession

is now at a crossroads. By 2010 Gartner predicts the profession will have split

into four separate and distinct domains of expertise: Technology Infrastructure

and Services; Information Design and Management; Process Design and Management;

and Relationship and Sourcing Management.

Risk

aversion and attack readiness

While Asia is now the source of

much new technology, some of the biggest threats to enterprises also originate

in the region. Gartner believes that by the middle of next year less than 5 per

cent of businesses will have adjusted or have created business continuity plans

to cater for disasters such as avian influenza. IT preparedness integrated into

a solid business continuity plan can greatly mitigate risks and minimise impact.

Gartner also believes organisations that implement an effective incident

response plan will experience an 80 per cent increase in the speed at which they

recover from attacks by criminal organisations using the latest in malicious

software.

 Fore

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