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Michael Fauscette, Group Vice President, SBS




©Copyright 2008 IDC
 2009 IDC                                            ...
Episodes of Financial Stress
         %




              Stock Market
                 Crash
                            ...
Economic Outlook
             2009 GDP Growth: Forecast Change




© 2009 IDC   Source: EIU October 6, 2008, January 14, 2...
Economic Outlook
                2009 & 2010 GDP Growth Picture




© 2009 IDC   Source: EIU April 7, 2009            4
  ...
Where We Stand
                                    WW IT Spending




                                                    ...
Applications Forecast Changes




©Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved.
 ...
SaaS forecast comparison




     $M




 • IDC has increased its SaaS growth projection for 2009 from 36% growth to 42% g...
An Economic Unknown




             $1-3 Trillion For
              Bank Bailouts
              Tax Cuts
             ...
The Potential Impact of Stimulus Plans
     WW ICT Spending Growth                                WW ICT Spending (B)




...
Poll #3

       What do you think global IT spending growth in
       2009 should be?
     ( 2% )    + 1% or higher
     (...
Poll #5

       What have you heard from clients in the last
       quarter about their order rates?

       Apr 09    Jan...
Software Megatrends
 Structural Changes Accelerated by the Financial Crisis
    •  New Delivery Models:
           Softwa...
Applications Software Top Ten Predictions 2009

    Business Models:
       * The 2008 Financial Crisis Will Drive Acceler...
Applications Software Top Ten Predictions 2009

    Partner Programs:
       * Several Large Software Vendors Will Restruc...
Consolidation

Consolidation continues – the “mega” ecosystem


Partners coalesce around an epicenter


Partners consolida...
The new landscape of Tech

 Mega-Vendors: HP, Oracle (post Sun close),
 IBM, Cisco, Microsoft, Google, Apple, Intel

 Prim...
The Social Enterprise

Democratization and Empowerment: Spreading control across
a broad audience, adding value, building ...
The Social Enterprise

Internal:
             Wiki’s
             Collaboration / email / IM / microblog
             Mash...
The Social Enterprise

External
• Customer / Partner / Suppliers / Outsourced
   •  Blogs

   •  Microblogs

   •  Private...
Consumer
               Apps          Collab         CRM           Content
                                               ...
Consumer        Collab        CRM          Content
               Apps                                      Apps
         ...
Growth markets
Market                    2009    2010
Conferencing Apps         6.5%    7.8%
Content Management        6.1...
Preparing for the recovery

Refocus on key opportunities like SaaS, BI, integrated hybrid
solutions (SOA), vertical specif...
Contact



              Michael Fauscette
              mfauscette@idc.com
              Twitter: mfauscette
            ...
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Fin Crisis & the impact on the software industry

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A brief look at the impact of the financial crisis of 2008 on the software industry and the emerging new business models, trends, etc.

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Fin Crisis & the impact on the software industry

  1. 1. Michael Fauscette, Group Vice President, SBS ©Copyright 2008 IDC 2009 IDC 7-09
  2. 2. Episodes of Financial Stress % Stock Market Crash Scandinavian banking crises LTCM ERM crisis collapse Nikkei/junk bond collapse Source:IMF © 2008 IDC © 2009 IDC 7-09 2
  3. 3. Economic Outlook 2009 GDP Growth: Forecast Change © 2009 IDC Source: EIU October 6, 2008, January 14, 2009, April 7, 2009 3 7-09
  4. 4. Economic Outlook 2009 & 2010 GDP Growth Picture © 2009 IDC Source: EIU April 7, 2009 4 7-09
  5. 5. Where We Stand WW IT Spending Worldwide GDP Forecast © 2009 IDC Source: Q2 & Q3 2008 Worldwide Black Books; IDC Downside Scenario Model 7-09 5
  6. 6. Applications Forecast Changes ©Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved. 2009 IDC 7-09
  7. 7. SaaS forecast comparison $M • IDC has increased its SaaS growth projection for 2009 from 36% growth to 42% growth over 2008. • The percentage of U.S. firms which plan to spend at least 25% of their IT budgets on SaaS applications will increase from 23% in 2008 to nearly 45% in 2010. Source: Economic Crisis Response: Worldwide Software as a Service Forecast Update (IDC #215504, January 2009) ©Copyright 2009 IDC. Reproduction is forbidden unless authorized. All rights reserved. 2009 IDC 7-09
  8. 8. An Economic Unknown $1-3 Trillion For  Bank Bailouts  Tax Cuts  Smart Grid  SMB Incentives  Health Care  Infrastructure  Broadband  Auto Manufacturers  Green Building © 2009 IDC 7-09 8
  9. 9. The Potential Impact of Stimulus Plans WW ICT Spending Growth WW ICT Spending (B) $250 Billion over 4 Years © 2009 IDC Source: Q4 2008 Worldwide Black Book, IDC Estimates 7-09 9
  10. 10. Poll #3 What do you think global IT spending growth in 2009 should be? ( 2% ) + 1% or higher ( 15% ) 0% ( 27% ) - 1% ( 38% ) - 2% ( 7% ) - 3% ( 4% ) - 4% ( 6% ) - 5% or lower © 2009 IDC 7-09
  11. 11. Poll #5 What have you heard from clients in the last quarter about their order rates? Apr 09 Jan 09 Oct 08 ( 4% ) ( 7% ) ( 50% ) Have not talked to them ( 4% ) ( 4% ) ( 17% ) No crisis-related change ( 43% ) ( 38% ) ( 23% ) A minor drop in orders ( 45% ) ( 49% ) ( 10% ) A significant drop in orders ( 5% ) ( 1% ) ( 1% ) An increase in orders © 2009 IDC 7-09
  12. 12. Software Megatrends Structural Changes Accelerated by the Financial Crisis •  New Delivery Models:   Software as a Service/On-demand   Open Source   e2.0 (social networking, Web 2.0)‫‏‬ •  New Architectures:   Service-oriented Architecture (SOA)‫‏‬   Event-based   Unified access to content and data •  New Ways to Source a Business Process:   Build (mashups, process modeling, business rules, Web 2.0))‫‏‬   Buy (“good enough” suites vs. best-of-breed)   Integrate (software/services convergence)‫‏‬   Outsource (asset-based delivery)‫‏‬ •  New Targets:   SMB (intensifying competition for applications)‫‏‬   Channels   Partnerships (with partner-partner collaboration)‫‏‬ © 2008 IDC © 2009 IDC 7-09
  13. 13. Applications Software Top Ten Predictions 2009 Business Models: * The 2008 Financial Crisis Will Drive Accelerated Growth of Software-as- a-Service–Based Solutions. * Open Source Software Gets the Boost to the "Mainstream" by the Effect of the Economy and the Subsequent Change in Buying Behaviors. * Platform as a Service Will Create a "Custom" Alternative for Vertical- Specific Solutions, Putting Pressure on the Major Enterprise Software Vendors to Develop or Acquire a Platform-as-a-Service Offering. * Next-Generation Enterprise Applications Vendors Will Win the Trifecta of Business Models. (On Premise, On Demand/SaaS, BPO) Enterprise 2.0 * Consumer-Born Web 2.0 and Social Networking Tools Will Permeate New Customer and Partner Initiatives. * An Economic and Technological Perfect Storm Will Raise the Enterprise 2.0 Ship Higher than Others. © 2008 IDC 7-09 © 2009 IDC
  14. 14. Applications Software Top Ten Predictions 2009 Partner Programs: * Several Large Software Vendors Will Restructure Their Partner Program Tiers in 2009. * Partner Analytics Will Come of Age in 2009 as Vendors Seek Partner Quality over Partner Quantity. * Partners Will Create Several New "Partner Run" Partner-to-Partner Communities in 2009. Other: * Compliance, Litigation Preparedness, and Business Process Efficiency Will Continue to Drive Content Management Budgets. © 2008 IDC 7-09 © 2009 IDC
  15. 15. Consolidation Consolidation continues – the “mega” ecosystem Partners coalesce around an epicenter Partners consolidate to expand footprint & reach Hybrid business models © 2009 IDC 7-09
  16. 16. The new landscape of Tech Mega-Vendors: HP, Oracle (post Sun close), IBM, Cisco, Microsoft, Google, Apple, Intel Prime Acquisition Targets Survivors: niche markets, redundant portfolio, too unique Start ups © 2009 IDC 7-09
  17. 17. The Social Enterprise Democratization and Empowerment: Spreading control across a broad audience, adding value, building relationships, conversations and increasing transparency It’s not just “tools”, it’s changing processes and culture © 2009 IDC 7-09
  18. 18. The Social Enterprise Internal: Wiki’s Collaboration / email / IM / microblog Mashups / Platforms Networking Social Analytics Sales Productivity © 2009 IDC 7-09
  19. 19. The Social Enterprise External • Customer / Partner / Suppliers / Outsourced •  Blogs •  Microblogs •  Private Label Communities / Networks •  Public Social Networks Sales •  Idea Sourcing Marketing •  Virtual Conference / Tradeshows Product development •  Syndication Customer Service © 2009 IDC 7-09
  20. 20. Consumer Apps Collab CRM Content Apps Online Community Platforms – connecting, sharing, collaborating, building relationships/trust, publishing/authoring – UGC, customers as consumers Social Analytics Ideasourcing Enablers Wiki Social Wiki Customer Blogs Service Blogs +traditional Social SFA Crowdsourcing Collab (predictive selling) Brand Monitoring / building © 2009 IDC 7-09
  21. 21. Consumer Collab CRM Content Apps Apps Online Community Platforms – connecting, sharing, collaborating, building relationships/trust, publishing/authoring – UGC, customers as consumers Social Analytics Facebook SocialText Concursive Google Apps Lotus UserVoice Cisco Eos LinkedIn Connections Oracle Sales Reality Digital MySpace Sharepoint Prospector MyLife Twitter Jive Bright Idea OneRiot Google Apps Omniture Google Wink Apps © 2009 IDC 7-09
  22. 22. Growth markets Market 2009 2010 Conferencing Apps 6.5% 7.8% Content Management 6.1% 7.3% Enterprise Search 10.7% 8% HCM 5.4% 6% GRC / Financial Perf 7.3% 9.4% CRM 4.9% 5.9% SRP 12% 12.8% Business Rules Mgt 10% 11% Integration and Process 7.8% 8.9% Automation MdleWre Data Access, Analysis & 6.5% 7.7% Delivery Security 8.4% 9.3% Storage SW 6% 7.3% © 2009 IDC 7-09
  23. 23. Preparing for the recovery Refocus on key opportunities like SaaS, BI, integrated hybrid solutions (SOA), vertical specific add-ons to core platforms / products Good opportunity to leverage megavendor’s portfolio and add value on top rather than overlap P2P networking to provide broader / deeper solution set P2C – social initiatives to grow customer community © 2009 IDC 7-09
  24. 24. Contact Michael Fauscette mfauscette@idc.com Twitter: mfauscette Blog: www.mfauscette.com © 2008 IDC © 2009 IDC 7-09

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