The document summarizes ITCandor's predictions for the ITC market in 2010. It predicts that the worldwide ITC market will show zero percent growth in 2010, with Asia Pacific leading regional growth. Cloud computing is expected to mature and become a profitable delivery mechanism, while new analytic techniques will emerge to handle the growth in digital data. Government ITC spending will come under greater pressure. The document outlines several other predictions regarding third party channels, networking equipment, data center efficiency, gaming software, and the PC market. It concludes that 2010 will be an exciting year for recovery in the ITC industry.

1. ITC ‘Expectations 2010’ – Cloud, Gaming And
Convergence Drives The Recovery
Martin Hingley, President, ITCandor
ITC Analyst Report

2. Agenda
• On Making Expectations And Predictions
• The ITC ‘Expectations 2010’
– World ITC Market Forecast
– Regional ITC Growth Forecast
– Cloud Computing
– New Analytic Techniques
– Government ITC Spending
– Third Party Channels
– Enterprise Network War
– Data Centre Efficiency Drivers
– Software Drivers
– The PC Market
• Some Conclusions – A Realistic Forecast For ITC Market Recovery
ITC Analyst Report

3. On Making Expectations And Predictions
• This presentation was made by Martin Hingley with the help of ‘Henry
Fellows’ Carsten Schmidt, Marcel Warmerdam and Pim Bilderbeek
• Sizing and Forecasts are based on ITCandor’s Market Model
• 2010 will be exciting for CIOs, End-Users and Industry Execs
• ‘Expectations’ are designed to be stimulating
• These predictions exclude specific actions which imply either insider
knowledge or sheer guess work
ITC Analyst Report

4. 1. The World ITC Market Will Grow Zero
Percent
ITC Growth Forecast By Category ($US) – 2008-2013 • There was a
decline of 10% in
25% 2009
Hardware
20%
IT Service • The market is
Software already in
15%
Telecom Service
recovery mode
World ITC
• The ITC market
10% will show zero
percent growth in
5%
2010
0% • Hardware will lead
the recovery
-5%
• 2010 will see a
-10% return to
infrastructure
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
-15% spending absent in
11% 8% 11% 19% 9% -10% 0% 6% 8% 7%
Source: ITCandor 2009
ITC Analyst Report

5. 2. Asia Pacific Will Lead Regional ITC Growth
ITC Growth Forecast By Region ($US) – 2004-2013 • Asia Pacific
suffered the
30% greatest decline in
25% Americas
2009
Asia Pacific • It will outgrow the
20% EMEA
Americas and
World ITC
15% EMEA in 2010 with
10% ITC spending of
$1.8t
5%
• Asia Pacific will
0% see a growth in IT
-5% Services
• Hardware will
-10%
remain
-15% comparatively
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 strong in Asia
-20%
11% 8% 11% 19% 9% -10% 0% 6% 8% 7% Pacific
Source: ITCandor
ITC Analyst Report

6. 3. Cloud Computing Matures To Become A
Profitable Delivery Mechanism
• Cloud Computing will
Internal External mature enough for
Users Users suppliers to see a
return on investment
Cloud Computing • Traditional CIOs will
have the biggest
challenge
Private Public
• A strong take-up of
Cloud Cloud ‘… as a Service’
offerings by small
Implementation PaaS and medium
companies
Consolidation IaaS
• The development of
Modernisation SaaS ‘horizontal
outsourcing’ and
Virtualisation …aaS business services via
the Cloud
Service Hosting
IT Supplier ISV
Provider (Telco)
Source: ITCandor
ITC Analyst Report

7. 4. New Analytic Techniques Will Emerge To
Handle The Upsurge In Digital Data
• Monitoring and
Output metering expands
computable data
• Digitising Analogue
process creates new
information
New Analytics
• Advanced analytics
will be used make
sense of on-line
processes and
Input unstructured data
• New de-duplication
processes will be
needed in 2010
• Techniques will be
Machine Traditional applied from High
Performance
Data Data Computing expertise
Source: ITCandor
ITC Analyst Report

8. 5. Government ITC Spending Will Come Under
Greater Pressure
Worldwide IT Spending Growth By Vertical Market ($US) • Public
Administration
25% spending was the
2007 2008 2009
Distribution strongest Vertical
20%
market in 2009
Finance • It will come under
15%
increasing
10% pressure in 2010
• Lower taxes due
5% Others Public
to the recession
0% will require cost
Total Business IT
cutting
-5% • Re-generation
projects and
-10% Health will have
Source: ITCandor positive growth
ITC Analyst Report

9. 6. Business And Industry Expertise – Not
Logistics – Define Third Party Channels
• 2009 was a
terrible year for
Distribution Sell End Of Life
many channel
1st Customer Recycler partners
Resell
• Increasing
2nd Customer
Ship competition from
Re- vendor direct sales
Finished Goods Nth Customer purpose
Manufacturer • Channel players
will increasingly
become service
Scrap
Assemble Recover providers
• Cloud Computing
Component Component
Manufacturer Manufacturer
will accelerate the
N A Raw Recycled Landfill provision of simple
Material Material
Component business process
Manufacturer Process outsourcing by
B industry specialists
New Equipment Channel Disposal Channel
Source: ITCandor
ITC Analyst Report

10. 7. The Enterprise Network War Will Intensify
Enterprise Network Equipment Growth By Supplier ($US) • The Enterprise
Network market
50% was poor in 2009
40% • Cisco’s UCS
Juniper
ZTE introduction
30%
Avaya disrupted its
20% relationship with
10%
Cisco many system
vendors
0%
HP • 2010 will see more
EMC
-10% M&A activity
-20% Alcatel Lucent • Convergence
between
-30%
Nortel networking and
-40% systems and
-50%
Q108 Q208 Q308 Q408 Q109 Q209 Q309 between IT and C
will continue
Source: ITCandor apace
ITC Analyst Report

11. 8. Higher Electricity Prices – Not Legislation Or
CSR – Will Drive Improvements In Data Centre
Efficiency
• The Copenhagen
The Five Phases Of Data Centre Transformation Summit failed
• There is no legally
binding agreement
on reducing
Physical greenhouse gases
Centralization Consolidation • CSR continues to
take a back sea in
the recession
• 10% of CIOs and
AIX their organisations
are committed to
alternative energy
Data Migration Application
• Higher Electricity
Integration prices will drive data
centre
transformation and
efficiency
Storage improvements
Consolidation
Source: ITCandor
ITC Analyst Report

12. 9. Gaming Applications Will Continue To Out-
Perform Other Software Areas
Software Spending Forecast ($US) – 2003-2013 • Demand for ITC
from consumers
continues to outstrip
$350
that from businesses
$300 during the downturn
$250
• Gaming software will
out perform other
$US billion
$200 software categories
$150
in 2010
• Gaming software will
$100
spread across
$50 consoles, PCs and
phones
$0
2003 2004 2005
Americas • Digitising the book
2006 EMEA
2007 2008 2009 2010 Asia Pacific industry and the
2011 2012
2013 production of
associated tablets
Source: ITCandor will lead to growth
ITC Analyst Report

13. 10. The PC Market Will Grow By 1.5% , But
Device Diversity And Desktop Virtualisation
Continue
World PC Growth Forecast ($US) – 2007-2013 • PCs are the largest
single component of
30% the ITC market
2008 2009
25%
25% $337b $289b • The market fell by
6% -14%
20% 14% in value in 2009
15% 16% • The PC market will
13% grow by 1.5% in
10%
7% 6% 2010
5%
5% 4% 3% • Increasing
3%
0% 1% competition will
-5%
-3% come from
-9%
alternative devices
-10% -11%
-13%
and virtual desktops
-15% -15% • Telecoms companies
2007 -19% 2010 2011 2012 2013
-20%
$294b $308b $321b $329b
will develop as a
$319b
-25% 19% 1.5% 5% 4% 3% distribution channel
Source: ITCandor
ITC Analyst Report

14. Some Conclusions – A Realistic Forecast For
ITC Market Recovery
• ITCandor’s research measured the downturn accurately through its
detailed focus on vendor revenues
• Recent quarterly financial results demonstrate a return to growth for a
few and an up-tick for most vendors
• Zero percent growth may be over-optimistic if major disasters
intervene
• 2010 will be an exciting year in the ITC industry for CIOs, end-users
and industry execs
• ITCandor wishes you the best of luck
ITC Analyst Report

15. Questions, Answers And Contact Details
Martin Hingley, President, ITCandor
Limited
Martin_Hingley@itcandor.com
Mobile: +44 (0)771104555
Office: +44 (0)1235202125
ITC Analyst Report