New data from IDC's Cloud Services Forecast shows that cloud services will outpace traditional IT spending over the next five years and will represent $44.2 billion, or roughly 10 percent, of all IT spending by 2013.
However, the missing link in this data set is that these numbers account only for IDC's cloud services taxonomy (Application Software, Application Development and Deployment Software, Systems Infrastructure Software, and Server and Disk Storage capacity) and don't represent private clouds.
Private clouds--or at least internal enterprise applications that use the same principles--will undoubtedly become a major trend over the next five years. In addition to the cost savings of using existing compute power, the ease of use of cloud APIs will work their way into the enterprise quickly, now that developers are comfortable with public cloud services like Amazon S3 and EC2.
If public cloud services will be 10 percent of all IT money spent, that represents a blisteringly fast growth rate. And while we certainly don't wish the recession to continue, it's interesting to see how companies have adapted their IT plans to take advantage of services that require far less capital expenditure. From IDC:
The five-year growth outlook remains strong, with a five-year annual growth rate of 26 percent--over six times the rate of traditional IT offerings. In spite of the challenging economy--or more accurately, because of it--this growth rate advantage expanded from last year's forecast, in which cloud services were forecast to grow at over five times traditional offerings.
There is no question that cloud services are in their infancy and that the market is ripe for further disruption. The challenge going forward will be to accurately measure just what applications and services are internal, external, cloud, or otherwise.
In the meantime, let's all just be glad to see IT spending on the rise.
As market research firm NPD Group prepares to release sales data data for the U.S. game market next Thursday, other analysts have predicted a return to double-digit growth after six months of decline.
According to Edge Online, Wedbush Morgan Securities analyst Michael Pachter and Electronic Entertainment Design and Research's Jesse Divnich expect monthly software sales of $750 million (up 21 percent year over year) and $715 million (up 16 percent), respectively. And while these are still just estimates, it shows that consumers are still willing to spend on high-quality new games.
EEDAR's top 10 forecast:
Halo 3: ODST (360, Microsoft) - 1,800,000
Wii Sports Resort (Wii, Nintendo) - 500,000
The Beatles: Rock Band (Wii, EA) - 350,000
The Beatles: Rock Band (360, EA) - 325,000
Marvel: Ultimate Alliance 2 (360, Activision) - 300,000
Madden NFL 10 (360, EA) - 275,000
Batman: Arkham Asylum (360, Eidos) - 250,000
Batman: Arkham Asylum (PS3, Eidos) - 250,000
Guitar Hero 5 (360, Activision) - 250,000
Guitar Hero 5 (Wii, Activision) - 200,000
One interesting note on the top 10 list is that it contains only seven titles, which shows the importance of supporting multiple consoles.
If recent research is any indication, Amazon.com and Google are winning the cloud game.
Evans Data on Tuesday released a report (registration required) on how developers perceive cloud service providers related to cloud services offerings, including their completeness and the companies' ability to execute on the vision.
Janel Garvin, the founder of Evans Data and the author of the report, provides excellent insight into the current state of the market and how quickly things could change, if certain large vendors (notably AT&T and Microsoft) got their acts together more quickly.
Given their robust services, it isn't surprising that Amazon and Google top the list. And although IBM, VMware, and Microsoft trail, each offers important components of cloud infrastructure.
... Read moreWhile recent research suggests that video game addiction is reaching pandemic levels, the prevalence of such addictions is being disputed widely.
Video games are indeed an easy target for many societal ills, not just addiction. Driving home that point, Neils Clark, co-author of "Game Addiction: The Experience and the Effects," on Saturday described in a blog post what he deems 10 game addiction fallacies.
The list of fallacies includes the fact that games aren't drugs, which means that treatment will vary greatly. In addition, because definitions and methodologies used in studies are varied, criteria by which addiction is measured is inconsistent.
Clark's post highlights a few points related to how addiction is treated behaviorally, as well as how the media has chosen to portray gaming in a negative light.
The consistent challenge in measurement exists not just in statistics gathered but also in the methodology used to understand the data. For example, one study cited by many experts was based on extrapolating data from a survey that asked adults about their gambling habits.
Amazon Payments today launched a new service that brings the company's payment processing tools to mobile devices. Amazon Mobile Payments Service (MPS) includes a set of APIs (application programming interfaces) that allow mobile developers and merchants to provide payment options to their customers within mobile Web sites and applications--including the convenience of Amazon's 1-Click checkout system.
There are already a number of mobile payment providers, but Amazon is the big dog of the e-commerce world with an enormous amount of customer accounts already in use. This could be an excellent option for companies that offer mass-market mobile applications and are looking for ways to easily accept payments.
The service will automatically detect the request origin, meaning a Web or mobile browser, or a mobile application so that developers don't need to re-work their applications.
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IBM on Monday is expected to release a new enterprise collaboration service based on its LotusLive cloud-based platform. The service comes with 1GB of storage and will cost $3.75 per user per month.
The new IBM LotusLive iNotes service is IBM's first real foray into a mass-market cloud-based service, including e-mail, calendaring, and contact management all designed to work with existing on-premise e-mail or operate as a standalone solution. Per user pricing will start at just $3 per month.
Realistically, the new IBM service isn't much different than you see from the likes of Google Apps or Yahoo--the big change is that it's coming from IBM, an enterprise stalwart. Whether you like Lotus Notes or not, this is big news as an endorsement of cloud computing and hosted applications.
Sean Poulley, vice president of IBM Cloud Collaboration Services, said customers have been looking for strategic versions of hosted solutions for a long time. The cloud approach of multitenancy means that the real cost of IT--the cost of running the applications--is reduced, bringing economies of scale to the offerings. IBM has been working on making the service secure and "enterprise ready," he said.
IBM's decision to start offering more cloud-based services is predicated on the notion that fewer people in IT organizations are carrying more responsibility. They are also more dependent on people outside of their organizations that need access to shared documents and files. On-premise collaboration applications can likely be manipulated to work in a shared manner, but LotusLive has been designed to work that way from the ground up.
When I asked why IBM would brand the new service as part of the Lotus family, Poulley said that more than half of the Fortune 100 companies use IBM collaboration technology that includes Lotus Notes and are well aware of the brand.
If you need further proof that open-source applications are ready for prime time, take today's news from open-source business intelligence company Jaspersoft, which announced that British Telecom is using its business intelligence suite to support more than 8 million voice mail subscribers.
BT and Unisys, a longtime Jaspersoft partner, say they chose Jaspersoft for its modular design, which reduces maintenance and cost and gives them customization abilities that improve capacity planning.
The deal with BT also represents how important a solid channel strategy is for open-source software companies.
Jaspersoft CEO Brian Gentile has in the past mentioned that the BI market is heavily influenced by a few technical aspects, including SOA/Web services (and overall componentized design), in-memory analytics, integrated search, and the use of rich media services to provide more compelling (Web-based) user experiences.
The other obvious factor in the shift to open-source BI (and open source in general) is the economics behind the applications and ongoing operations. And perhaps more important is the control--both on-premise and online. As consultant Carlo Daffara noted recently, "the critical aspect is being able to assess this control and weight if the lack of control is compensated by the features you get (which is reasonable) or what kind of risk you are accepting in exchange."
In conversation earlier today, Gentile further asserted, "open-source software is both augmenting and displacing aged, proprietary solutions across industries and at the largest companies. British Telecom is just one example of a company that has realized traditional, proprietary software is just too expensive and too complex. The most aggressive companies figured this out long ago. But now, with heightened economic pressures and the feature maturity of open source, the secret is out and the choice is clear."
There was a time when people would debate whether or not open-source software was reliable enough to support a small office. Those days are long gone. The down economy and maturity of open source are the perfect storm for major disruption.
Ricoh's visual online storage service--enigmatically called "quanp," (short for quantum paper)--remains an ambitious undertaking. On Wednesday, it's announcing improvements to its Windows client and browser interface as part of its U.S. beta test.
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I've covered Ricoh's plans for extending the reach of documents and creating interconnections between devices and the cloud before, and it's nice to see it adding new features quickly. The focus of this current upgrade is connecting tags and visual search to give the average user a lot of power and flexibility to organize and store data online.
But this is just one small step toward an ambitious, expansive goal. quanp wants to be the one core spot online for organizing and storing all your digital info. As people's lives quickly become more and more digitized, this is a natural progression and will be a growing need for computer users everywhere.
According to a Ricoh commissioned poll by marketing research company Research and Development, Inc. the "intention" to use online storage continues to increase, up to 22.3 percent. How do you suppose that compares with U.S. internet users? (Note: someone needs to name this category. "Life Portal"? "Life Aggregator System"?)
A key part of online storage and organization is how you interact with your data. I actually like the quanp interface--though the browser version lags behind the Windows client, which is very popular in Japan.
I have to think they're getting strong feedback from U.S. users that it's browser, browser, browser over here. At any rate, the UI is intuitive and not overly complicated--a nice break from the tired Windows-nested folders paradigm. Odds are you will eventually overload its simplicity and ease-of-use. But they're on to something. Simple is good.
Ultimately, quanp may connect you to some sort of lifecasting service. You can store data on quanp during the day and then easily pull from there to tweet or blog about what is happening. If they add more connections through more devices--mobile is obvious--you really could start to rely on the service.
Incidentally, quanp's kicking off a Twitter contest Wednesday, running through October 6, for a chance to win a new iPod Nano. For more info, see http://www.twitter.com/quanp.
Microsoft's launch party videos have proven to be entertaining to viewers even if not for the reasons for the marketing department had hoped for. There were a great many comments on my post that provided context to their release, but generally speaking most industry-watchers have been confused as to the goals behind the program, questioning the target audience not just for the videos, but for the launch parties as well.
I reached out to Microsoft for comment but they withheld at this time as the videos are apparently just one step in a much larger integrated marketing campaign.
I personally found the most recent video weird, but after thinking through things a bit I think this is a case of a good idea hampered by poor execution. The videos are well-done and professional and try to connect with consumers in a humanistic tone. The fact that it feels like you stumbled into a shiny-happy Windows world filled with sit-com throwaways is the problem. Even if this is a training video to show others how to throw a launch party, it's hard to connect with the vapid characterizations of party guests.
This is the crux of Microsoft's marketing problems. It's not that they aren't good at technical marketing issues, it's that the brand itself is so voluminous, it's very hard for people to connect to specific products like Windows. And the efforts to persuade consumers isolate the tech media and confuse IT shops.
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New data released by Gambit, a micro-transaction platform provider, illustrates the complexity of both customer targeting and analyzing micro-transaction buying patterns. The major takeaway: older players seem like a good target market until you dig in to find out that they don't spend a whole lot.
But, it takes a minute to understand the data, as Gambit's Susan Su points out in a blog post on how age impacts social-gaming monetization. While it would appear that older users are a good target market thanks to their high revenue-per-user statistic, they are actually pretty meaningless in terms of revenue.
So what does this mean for game developers looking to monetize users?
First, the older demographic shouldn't be ignored as it offers a very high revenue-per-user ratio. Second, it shows that younger gamers are figuring out ways to pay for things, leading me to believe that alternative noncash payment platforms such as game cards and in-game currency have a strong future.
The other important factor in this data is that game developers (and really any marketers) need reliable data to target the best customer. Even customers with low annual revenue figures can be very meaningful provided you can find enough of them. Think of Paypal or Visa in terms of low-margin high-volume transactional systems that bring in high-quality revenue streams.
(Thanks to Susan Su (@susanfsu)of Gambit Payments for use of the data.)
