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All Geared Up for the Upturn

By John Mark V. Tuazon

The global financial crisis, which affected numerous companies around the globe, significantly restructured the IT landscape by changing the way the game is played. Organizations, whose core businesses were affected by the crisis, had no recourse but to increase budget cuts and invest on technologies that would reduce operational expenses in order to survive the downturn’s harrowing effects.

In exclusive e-mail interviews with Computerworld Philippines, technology vendors come out unanimous in saying that investments on technologies that promote cost cutting and operational efficiency will define the IT agenda of companies next fiscal year.

The IT and Macroeconomy

“In today’s increasingly competitive global economy, the need to transform business models has become a pressing reality for all businesses,” says James Velasquez, country general manager, IBM Philippines. Velasquez notes that close dealings with the IT department of firms is needed in order to ride the wave of the upturn. “We see a much closer integration between Business Strategy and the use of IT to support and drive [the business],” he adds.

Investments in IT, therefore, are put under the microscope, as firms struggle to keep up with running the business while ensuring its profitability. “IT spending will increase slightly in 2010 as we come out of a recession, and [we] are anticipating companies to be more prudent and targeted in making their purchasing decisions to ensure they get the best ROI,” posits Ronnie Latinazo, country manager, EMC Philippines. Cost-saving innovations—which include mobility solutions, cloud computing and virtualization—are among those forecasted to define the way businesses deal with the impending upturn in the coming year.

The Mobile Workforce

As businesses inch towards a more integrated global working environment, technologies that promote mobility are inevitably brought to the fore, consequently addressing cost problems. “The increased use of mobility solutions will lessen the need for expensive and time-consuming travel, and aid productivity through virtual meetings, distance learning and cost savings,” claims IBM’s Velasquez. In an increasingly connected world, mobile technology graduates from a mere “nice-tohave” supplement to the business process as it moves towards being a competitive advantage for firms. “For 2010, we see businesses investing in heightening their mobility in order to stay relevant and competitive,” echoes Ricky Banaag, country manager, Intel Philippines. Banaag says their recent release of Intel Core i7 mobile processors and its upcoming launch of the new Atom Pinetrail platform will drive the company’s mobility agenda to the companies’ boardrooms. “Businesses operating in the mobile space will find this increase in computing power while on the go an important advantage,” he reiterates.

On the other hand, costsaving measures and increased demand for anytime, anywhere information is posing new challenges and opportunities for businesses, according to Barry Bunyi, country manager, Dell Philippines. “As these two trends converge, the way technology is deployed in the enterprise is also changing,” he explains, adding that this change will bring about huge opportunities for those who embrace it.

Technology Drivers

As the enterprise technology landscape continues to change, Bunyi says key technologies will bring fresh insights into the way business processes are handled. “Virtualization, cloud computing, Software as-a-Service (SaaS) and other solutions will bring about unprecedented efficiencies while enabling customers to free up resources to innovate and gain competitive advantage,” he says. The inevitable growth of data, according to data center vendors, will drive more investments in the virtualization area. “Data growth will continue to grow as we automate more,” says David Blumanis, data center advisor, APC by Schneider Electric Asia Pacific and Japan. “We never remove data, and we continually as for more to manipulate in order to assist us in making business decisions.” Due to such changes in the amount of data, IT budgets are reallocated to manageable and efficient technologies such as virtualization. “As companies seek to manage information growth, budgets that were previously allocated for storage and server purchases are now being reassigned to establish virtualized and cloud-based infrastructures,” explains EMC’s Latinazo. To address this growing demand for virtualization, Latinazo said three industry vendors—Cisco, EMC and VMware—have collaborated to offer Vblock Infrastructure Packages, which shall provide customers with a fundamental approach to streamlining and optimizing IT strategies around private clouds. Cloud computing, therefore, continues to emerge as the imminent technology that shall rise out of the maturity of virtualization. “Advancements in virtualization technology have developed strong interest in cloud computing, particularly among small businesses or start-ups who cannot afford upfront IT investment,” says Intel’s Banaag. Companies, however, did not consciously fall into the web of cloud computing. “They have either fallen into it by accident this year as they learned its definition, or they are seriously exploring all the possibilities of cloud computing next year as vendors develop more quality offerings,” describes Blumanis.

Either way, Banaag sees cloud computing as a transformative technology for most businesses. “It will change the way people work and how companies operate, as they shift to consume services in a more cost-effective way,” he stresses.

Green means Efficiency

The global campaign for responsible use of the planet’s resources has made its way to the enterprise space, as businesses continue to strive to reduce power consumption and pollution as a means to adopt green efforts. Compared to 2009, however, APC’s Blumanis believes companies will see past the cost-saving function of green computing. “Governments will dictate behavior of corporate enterprises on energy management and usage,” he explains. “Companies will [therefore] make decisions to ‘save the planet’ and not just decisions based on saving costs, as we have seen in 2009.” According to Katrina Tirante, manager for Southeast Asia Marketing, Emerson Network Power Asia Pacific, the need to improve energy efficiency is the number one IT&C concern of most businesses. “Data center users, influencers and IT resellers today are seeing opportunity to leverage efficient technologies to meet business challenges,” she says. In the hopes of reducing power consumption and saving on costs, facilities that drive energy usage are therefore put under the microscope. “We find new business areas where technology can be applied to enable the business, which results in more data storage requirements, leading to more high density systems, which will result in more power and cooling requirements,” says APC’s Blumanis.

Because of this, more high density areas will be required inside data centers, especially because virtualization and cloud computing calls for more high density computing. “If you don’t have any High Density areas, now you will, and those who already have will get bigger,” Blumanis adds. Looking into IT and Facilities management as separate silos will therefore become a thing of the past. “IT and Facilities operating as separate divisions or stove pipes will be a sign of the past,” Blumanis predicts. “Decisions made in isolation by one of these individual groups will cripple the business in the future.”

Looking ahead

The year 2010 will become an exciting playground for most IT vendors as they catch the wave of the upturn, or continue to build upon the momentum they established during the recession. But as investments in developing new technologies continue to rise, development of knowledge and expertise of technology enablers are also becoming an emerging trend. IBM, for example, is set to launch its Innovation Center, which shall address the growth for software and applications development. “This center caters to the academe, developer community, our business partners and of course, our clients,” explains Velasquez. EMC, on the other hand, has invested heavily in developing the required technologies for its business through the South Asia Development Lab, which “conducts the IT industry’s most rigorous, end-to-end interoperability and integration testing, spanning every major server platform, infrastructure component and networking element, among others,” Latinazo explains.

Meanwhile, Manuel Wong, country manager, Acer Philippines, sees an increased uptake of hardware gadgets with innovative technologies that have been developed over the last several years. “Better processors, operating systems and wireless developments will continue to drive PC purchases,” he says, adding that innovations such as multi-touch capabilities and 3D technologies will see an increased uptake in 2010, as well as new-generation All-in-One PCs. These technology innovations, however, are rendered useless without the stable amount of computing power, which microprocessor manufacturer Intel is continually trying to improve to deliver faster processing and more efficient process handling. “On the enterprise side, we have lined up the production and release of Nehalem-EX, which will deliver a number of new technical advancements and boost enterprise computing performance,” Banaag shares. Featuring up to eight cores inside a single chip, Banaag says the Nehalem-EX is ideal for server consolidation, virtualized applications, data demanding enterprise applications and technical computing environments. On the other hand, Westmere-EP –Intel’s next-generation intelligent server processor – offers significant computing performance increase compared to the Nehalem-EP, and enhanced security. Banaag says they are also set to launch the world’s first 2-billion transistor microprocessor—codenamed Tukwila—which delivers scalable performance and is optimized for the intensive requirements of database, enterprise resource planning (ERP), and business intelligent (BI) applications.

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