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Gartner Identifies Six IT Trends that will have a Significant Impact on People, Business and the IT Industry

    Online News published in DMReview.com
November 29, 2005

Gartner, Inc. unveiled six IT industry trends that it expects will cause significant disruption and drive opportunity for business and the IT industry in 2006 and beyond. "These six IT trends are expected to drive market growth, representing revenue opportunities for both incumbents and new market entrants in each space," said Daryl Plummer, group vice president and chief Gartner Fellow. "To catch the waves of change at their early stages, vendors, users and investors in technology will need to look outside their industries to find early adopters that provide inspiration for how these trends translate into business value."

These six key trends are part of a series of "Gartner Predicts" research that will include nearly 50 reports that discuss the major trends that will affect IT users, vendors and most industries in 2006 and beyond. Each year, Gartner analysts in every research area converge to identify, debate and develop these trends to help companies with their tactical IT planning and investment decisions in the short term and their overall IT strategy in the long term. The Gartner Predicts 2006 Special Reports series will be available on gartner.com beginning in December.

By 2008, 10 percent of companies will require employee-purchased notebooks.

Company-owned notebooks are commonly used for personal purposes, such as e-mail, music and videos. Gartner predicts that notebooks will begin to move from company ownership to personal ownership. Since notebook prices have declined dramatically during the past few years, this transition is mostly likely to be managed through the implementation of a notebook allowance, much like car mileage today.

"Transferring notebook ownership to employees does not eliminate the cost of PCs, but shift it to employee benefits and indirect user operational costs," said Leslie Fiering, research vice president at Gartner. "The payback is removing PC assets from the company books and freeing IT to focus on critical business initiatives."

By 2010, 30 percent of U.S. homes will use only cellular or Internet telephony.

 In 2004, nearly 90 percent of the world's new telecom connections were mobile. Growth in traditional wired voice connections will slow in North America, Western Europe and other developed markets as more people dedicate fixed phone lines to DSL links and switch to cellular or Internet telephony. U.S. consumers are just beginning to add voice over Internet Protocol (VoIP) services to their range of telephony options, but as they get more comfortable with the technology, and as VoIP services improve, they will start to abandon traditional phones. Mobile communications will remain the preference of developing countries, and as a result, wireless links will represent 99 percent of the world's new voice connections in 2009.

"It only took more than 125 years but POTS (plain old telephony service) is now on the decline in the U.S.," said Ken Dulaney, vice president and distinguished analyst at Gartner. "The emergence of VoIP and the phenomenal rise of the mobile phone now represent the 'dial tone' for the future."

The job market for IT specialists will shrink 40 percent by 2010.

The coming decade will see the emergence of IT "versatilists," people whose multidisciplinary assignments, roles and experiences create a valuable blend of synthesized knowledge, competencies and context to fuel business value. "Today's IT specialists must focus on a rapid and intentional expansion from technical specialization to business competence in order to position themselves as tomorrow's business contributors," said Diane Morello, research vice president at Gartner.

"The long-term value of today's IT specialists will come from understanding and navigating the situations, processes and buying patterns that characterize vertical industries and cross-industry processes."

Business Process Outsourcing (BPO) service providers will capture $11 billion of insurance revenue by 2008.

Insurers are turning to external BPO providers to expedite their legacy transformation process. BPO providers are responding by assuming the business process requirements from insurance providers. Gartner analysts predict that by 2008, BPO will have the intellectual property and technology platforms to align with the distribution channel (for example, bank and investment houses) and launch insurance ventures that capture up to one percent of the global annual premium total of life, annuity, and property and casualty products.

Using the US as an example, this translates into a shift of nearly $11 billion to BPO which will have a substantial impact on the market landscape. "Intellectual capital is migrating from insurers to BPO providers, enabling the providers to become competitors - not just service providers - in the insurance market," said Annemarie Earley, managing vice president at Gartner. A

50 percent growth in healthcare software investment could enable clinicians to cut the level of preventable deaths in half by 2013.

 Healthcare has historically underinvested in IT, however, this is changing. Gartner analysts predict that by 2009, healthcare investments in IT will increase by more than 50 percent, which could enable clinicians to reduce the level of preventable deaths by 50 percent by 2013. "The earliest adoption of IT - and realization of improved safety and cost containment - will occur in markets where the ultimate payers exercise leadership to stimulate simultaneous adoption of IT, consensus quality measurements, transparent reporting and aligned financial incentives," said Wes Rishel, managing vice president at Gartner. "The largest IT challenge in most countries will be deploying IT to the numerous small practices that provide most primary care."

Through 2008, investigation of new technologies will slow as discretionary budgets divert to regulatory compliance.

Regulation is increasing, and the race for "regulatory parity" between the European Commission and the U.S. government ensures this trend will continue through 2010. Gartner analysts said that regulatory compliance spending is growing at a rate twice that of IT spending, and in many case, discretionary IT budgets are entirely consumed by compliance efforts, stifling initiatives that are important to business growth.

"New regulations will change the business realities that executives must confront," said Jorge Lopez, managing vice president at Gartner. "Most of these will also cause change for IT. The best IT organizations take the lead to work with the legal, financial, and business organizations of the enterprise to get ahead of the changes for better corporate performance."

More information is available in the Gartner Special Report "Gartner's Top Predictions for 2006 and Beyond." The report can be accessed on Gartner's Web site at www.gartner.com/DisplayDocument?ref=g_search&id=487286.

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