Growth in IT spending

Next year will bring moderate growth in IT spending, which will push many vendors into taking the plunge and developing some disruptive business models.

“A critical new ingredient we’ll see (in 2006) is the acceleration of disruptive business models; ‘open innovation’ in IT product and service development–the open-source effect–and online delivery of IT as a service–the Google effect,” Gens said in a statement. “These disruptive shifts will force most vendors to perform a strategic ‘gut check’ as they enter the year.”

The “Google effect” that Gens described would be prompted by the fear that the search giant will dominate more markets in the years ahead.

Gens also believes that open-source-like collaboration will grow in popularity.

“Most of the big market share leaders in IT–e.g., Microsoft, IBM, Oracle, SAP–got that way by keeping tight control over their own product development. The ‘go it alone’ model of innovation is an endangered species in the IT industry, and incorporating a community-based innovation model–e.g., open source–is quickly becoming an important ingredient for market leadership,” IDC said.

“In 2006, IDC believes that building more open innovation communities will be a big focus for IT leaders–including Microsoft,” the analyst firm predicted.

This year has seen a clutch of acquisitions, from Adobe Systems’ merger with Macromedia to eBay’s purchase of Skype. IDC expects that this trend will continue in 2006, as few vendors have finished reshaping themselves.

This entry was posted on Friday, December 2nd, 2005 at 5:56 pm and is filed under Google. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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