2010-06-02: IT spend, cuts, and slurls
Worldwide IT spend rebounds but European outlook cloudy
Capital spending on PCs, servers, storage, and network equipment has soared in recent quarters as businesses take advantage of the general economic recovery to catch up with overdue spending on critical hardware infrastructure.
Market watcher International Data Corporation (IDC) predicts that worldwide IT spending will increase by 3.8 percent this year, to reach $1.47 trillion. Hardware will lead the way, with growth of 6.4 percent, while software and services spending will increase by 3.1 percent and 1.5 percent respectively.
Emerging markets such as China and India are leading the charge, as they invest in new technology to support export-driven growth. And in the US, government stimulus funding has provided a much-needed boost.
“Just as capital spending on hardware is the first thing to fall in a recession, it’s also the first thing to come back up for air when IT budgets are surfacing above water,” said Stephen Minton, vice president of Worldwide IT Markets and Strategies at IDC. “There is undoubted relief that capital spending and general IT budgets are up, but it’s also clear that some weak spots persist.”
One of those weak spots is Western Europe, which is being impacted by the current debt crisis in Greece. IT spending in Western Europe is expected to be flat this year, having plunged 6.5 percent in 2009. According to IDC, any further strains on the confidence of European businesses and consumers could cast a cloud over the outlook for the second half of 2010.
HP wields jobs axe in $1 billion transformation
Hewlett-Packard (HP) expects to eliminate roughly 9,000 positions over a multi-year period by investing $1 billion in automating corporate IT systems.
The company said it will consolidate its Enterprise Services’ commercial data centres, management platforms, networks, tools and applications, to create a more scalable, modernised and automated IT infrastructure. Once complete, the transformation is expected to generate annual net savings after reinvestment of between $500 million and $700 million.
“Over the past 20 months, we focused on integrating EDS and improving profitability,” said Tom Iannotti, senior vice president and general manager, HP Enterprise Services. “Now that the integration is largely complete, we have identified significant opportunities to grow and scale the business.”
New drivers of business transformation
Meanwhile, social media, cloud and mobile computing have been hailed as the new drivers of business transformation. Those companies not serious about exploiting these technologies could be ‘left in the dust’ by competitors, it is claimed.
More than 120 CIOs and IT executives met recently at the CIO Executive Leadership Roundtable in Chicago, US. Hosted by the Chicago Chapter of SIM (Society for Information Management) and produced by HMG Strategy, the roundtable provided a high-level, private venue for sharing crucial knowledge, exploring new strategies, and envisioning new revenue streams via use of IT.
“This roundtable was a clear call to action,” warned Hunter Muller, President and CEO at HMG Strategy. “CIOs really have to take a good hard look at these newer technologies and figure out how to use them as value drivers – before their competitors do…”
Cloud goes Green
Hosting and cloud computing player Rackspace has been announced as the winner of ‘IT Operator of the Year’ in the Green IT Awards.
More than 75 organisations were nominated, with winners selected by readers of Green IT Magazine. Rackspace has adopted several initiatives over the past two years to help reduce its environmental impact, including:
• Deployment of ambient cooling technology at its data centre in Slough
• The planting of a tree for every new hosting customer (via the International Tree Foundation)
• The recycling of materials and use of paper from sustainable sources at Rackspace offices
“We’ve worked hard not only to make our customer offering sustainable, but also introduce internal initiatives such as employee education and recycling,” said Rackspace Managing Director, Brian Thomson. “We plan to continue to introduce even more initiatives over the coming years and work harder than ever to be green.”
One not so green technology sector is that of mobile handset manufacturing, where efforts are being thwarted by consumer usage patterns.
According to Heavy Reading Mobile Networks Insider, characteristics of green handsets include use of recycled materials, reduced use of toxic materials, and availability of more energy-efficient battery chargers, as well as chargers driven by alternative energy sources such as solar cells.
However, user habits remain the biggest obstacle to making mobile handsets more eco-friendly. “Discarding of still-usable handsets and failure to properly dispose of or recycle handsets are potentially significant contributors to environmental problems,” said Aileen Arcilla, author of the report Mobile Handsets: It’s Not Easy Being Green. “With the number of mobile subscriptions expected to exceed 5 billion over the next few years, the biohazards of handset disposal are likely to grow.”
Er, just one more thing…
Would you book a holiday through oldmanshaven.com? Or visit ipwine.com for a bottle of Chardonnay? And would you download music from mp3shits.com?
‘Slurl’ is the term given to a badly-named URL and is the subject of a new book by Andy Geldman, a self-employed computer programmer who originally coined the word.
Having discovered slurls in 2006 as ‘his true calling’, Andy set up a website and devoted all his spare time to hunting down more gems, with the slurls website bringing in over 75,000 visitors in 2009. His book takes the reader on a global journey to look at the special charms of technology and big business.
“There have always been unintentionally funny names, but the Internet takes it to a whole new level,” said Geldman. “It’s all because you can’t have a space in your URL. A business called ‘IT Scrap’ is fine in the real world, but not so great online with itscrap.com!”
Great work Andy.
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