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Reminder: Nobody Has a Clue How Many Wearable Devices Will Sell in 2018

Time.com

Even more than with most gadgets, this category’s future is shrouded in mystery

Jason Snell of Macworld thinks that the pundits who think it’s absolutely vital that Apple dive into the smartwatch market–such as analyst Trip Chowdhry, who predicts doom if the company doesn’t make a move by next month (!!!)–are a tad overexcited. Referencinganother post by iMore’s Rene Ritchie, Jason argues that smartphones are going to remain by far the biggest, most profitable category of gadget for years to come, even if they aren’t as much fun to talk about as a nascent field like wearables.

Jason and Rene are two of the smartest people who write about tech, and both of their pieces are well worth reading. I agree with most of what they say. But in his piece, Jason buttresses his skepticism by quoting some stats from research firm IDC, which is part of my former employer IDG:

IDC reported that in 2013, one billion smartphones were shipped, up 38 percent from the previous year. That’s a fast-growing market worth hundreds of billions of dollars. Meanwhile, on Thursday IDC predicted that the wearables market will reach 112 million units in 2018.

In other words, in four years the wearables market might grow to be one-tenth the size of today’s smartphone market—in units shipped. Presumably the average selling price of wearable items will be a fraction of that of smartphones, meaning the dollar value of the wearables market is even more minuscule compared to the smartphone market.

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Windows XP Migration and Commercial Spending Helped Offset Weak Consumer PC Demand in the First Quarter of 2014, According to IDC

IDC PMS4colorversion  Windows XP Migration and Commercial Spending Helped Offset Weak Consumer PC Demand in the First Quarter of 2014, According to IDC

Worldwide PC shipments totaled 73.4 million units in the first quarter of 2014 (1Q14), a decline of -4.4% year on year, according to the International Data Corporation (IDCWorldwide Quarterly PC Tracker. Although still in decline and with continuing weakness in consumer and emerging market segments, the preliminary results are slightly better than a projected decline of -5.3%.

Similar to the latter part of 2013, the upside in the first quarter arose primarily from demand in mature commercial markets. Commercial refresh projects, which had already been protracted, received a last push from the impending end of Windows XP support, particularly in Japan. In addition, slowing demand for tablets seems to have helped constrain previously drastic cutbacks in notebooks. Nevertheless, emerging regions continued to post weak results, with growth in Latin America and Asia/Pacific (excluding Japan)(APeJ) falling even faster than recent declines as both economic conditions and continued tablet penetration stifled PC shipments.

“Worldwide PC shipments have now declined for eight consecutive quarters as a result of shifting technology usage and competition (notably with tablets & smartphones) as well as economic pressures (including high unemployment, slow growth & investment, tight credit, and currency fluctuations) related to the Great Recession, sovereign debt crises, and their related impact on international trade,” said Loren Loverde, Vice President, Worldwide PC Trackers. “The economic front seems to be gradually stabilizing and/or improving. However, this has been a slow process, and it is unlikely that sovereign debt issues will be resolved soon or that growth in emerging markets like China will return to prior levels. On the technology front, the transition to more mobile devices and usage modes is unlikely to stop, although the short term impact on PC shipments may slow as tablet penetration rises – as we’ve begun to see in some mature regions. The net result remains consistent with our past forecasts – in particular, that there is potential for PC shipments to stabilize, but not much opportunity for growth.”

“PC shipment growth in the United States remained slightly faster than most other regions in the first quarter. However, the passing boost from XP replacements, constrained consumer demand, and no clear driver of a market rebound are expected to keep growth below zero going forward,” said Rajani Singh, Senior Research Analyst, Personal Computing. “A rebound in consumer or a continuation of accelerated commercial upgrades could boost growth slightly, but low demand for upgrades in general combined with competition from tablets and 2-in-1 systems limit the growth potential.”

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Welcome to the Connected Age

IDC PMS4colorversion 1 Welcome to the Connected Age

An IDC study present’s the first forecast and analysis of the cellular machine-to-machine (M2M) market in Asia/Pacific (excluding Japan), or APEJ. The total number of cellular M2M connections in APEJ will grow from 26.8 million connections in 2012 to 72.4 million in 2017, a 22% compound annual growth rate (CAGR). M2M spending will grow from US$3 billion in 2012 to US$6.7 billion in 2017, a CAGR of 17.3%.

Another IDC study analyzes the worldwide opportunity for the burgeoning “Internet of Things” (IoT) market. It provides a market outlook for 2013–2020 and sets the forecast within the context of the IoT ecosystem including intelligent systems, connectivity services, platforms, analytics, and vertical applications in addition to the security and professional services required to build out a complete picture. The study discusses the key market trends contributing to the growth of the IoT on a worldwide basis. A forecast of installed “things” and revenue is included.

More IDC infographics can be viewed here.

welcome to connected age Welcome to the Connected Age

MEA Enterprise Hardware Market Sees Constrained Growth

IDC PMS4colorversion 1 MEA Enterprise Hardware Market Sees Constrained Growth

The Middle East and Africa (MEA) enterprise hardware market, comprising servers and external storage, remains in a passive state according to the latest figures released today by International Data Corporation (IDC). Referencing its EMEA Quarterly Server and Disk Storage Systems Trackers, the research firm today announced that the market expanded a sluggish 5.1% year on year in 2013 to total $2.58 billion, with much of the growth spurred by infrastructure deals within the oil and gas (O&G), telecommunications, and BFSI verticals.

The MEA region’s x86 server market witnessed a 5.0% year-on-year increase in value, but a 3.7% decline in unit terms during 2013. “There are a lot of changes occurring in the MEA enterprise domain, with a gradual shift towards fully virtualized datacenters and cloud-based infrastructures,” says Zeeshan Gaya, research manager for systems and infrastructure solutions at IDC Middle East, Africa, and Turkey. “As such, the growth seen in the x86 server market’s value, and the corresponding decline in volume, can be attributed to the increased adoption of virtualization technologies that utilize fewer server units than is the case in traditional datacenters.”

The region’s external storage market expanded 5.1% year on year in 2013. ”The overall sentiment in the MEA storage market ended on a positive note in 2013, with most countries witnessing healthy growth barring a few in Africa,” says Swapna Subramani, senior research analyst for storage systems at IDC Middle East, Africa, and Turkey. “The storage market is witnessing increased uptake of entry-level and midrange storage devices driven by demand for the NAS protocol. Mobility and bring-your-own-device (BYOD) initiatives, video surveillance, and Big Data are the key driving factors for this ongoing shift within the MEA storage market.”

UAE’s enterprise hardware market witnessed a strong growth of 11.5% with 2013 revenue representing a healthy mix of spending by the country’s key verticals namely, Financial, Telco, Hospitality and Government sectors. Saudi Arabia’s growth was more subdued at 3.2% annually hampered by the small decline in the server market this year compared to the massive server revenue registered in the Kingdom last year.

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IDC’s New Buyer Technology Spending Forecast; Business Technology Spending Market will Reach $330.4 billion by 2017

IDC PMS4colorversion 1 IDC’s New Buyer Technology Spending Forecast; Business Technology Spending Market will Reach $330.4 billion by 2017

Framingham, MA – April 8, 2014 – International Data Corporation (IDC) today announced a new report, “United States Technology Buyer Forecast by Vertical: 2012 to 2017,” (Document # 247588) which  examines technology spending by 12 buying segments and how this new technology purchasing behavior differs by 15 vertical industries. According to the new report, the business technology spending market will grow at 6.9% 5 year CAGR from $236.6 billion in 2012 to $330.7 billion by 2017, while enterprise IT grows slowly at a 1.9% 5 year CAGR from $213.0 billion to 233.5 billion over the same forecast period.

  • ClicktoTweet, “Business funded technology  is expected to reach $275.2 b in 2014, accounting for 55% of total United States technology spending”

The new forecast quantifies how much money business areas including Accounting / Finance / Billing, Customer Service, Engineering, Architecture & Research, Human Resources, Industry Specific Operations, IT, Legal, Marketing, Other Horizontal Operations, Sales, Security and Risk and Supply Chain Management are spending on technology, and how this new paradigm differs by industry.  Key findings include:

  • Business funded technology is expected to reach $275.2 billion in 2014, accounting for 55% of total technology spending.  Industry specific operation is the largest business line, capturing approximately 45% of total business funded technology in 2014
  • Enterprise IT spending is growing only at a 1.8% 5 year CAGR, far below the overall 5 year technology CAGR of 4.6%. Only healthcare enterprise IT is growing faster (than overall technology spending.
  • Marketing is the fastest growing functional area, growing at a 5 year CAGR of 9.5%, reaching nearly $26 billion by 2017. The marketing function within the Communications and Media industry will spend the most on marketing in 2014, with the retail  vertical growing the fastest over the forecast period (11.2% 5 year CAGR).

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IT Spending by UAE Businesses to Top $4.6 Billion in 2014

IDC PMS4colorversion 1 IT Spending by UAE Businesses to Top $4.6 Billion in 2014

Business IT spending in the UAE is expected to increase 8.3% year on year in 2014 to total $4.63 billion, according to the latest figures released today by International Data Corporation. Referencing its recently released United Arab Emirates Vertical Markets 2013–2017 IT Spending Forecast (IDC#ZV11V), IDC anticipates healthy growth over the 2013–2017 forecast period as the governments of Abu Dhabi and Dubai continue to spend on upgrading the country’s infrastructure.

The public sector, which includes government, education, and healthcare organizations, will account for most of the business IT spending in 2014. Organizations in this vertical are predicted to invest $1.12 billion in IT and account for 24.3% of the spending, driven primarily by government-led initiatives to bring more public services to online and mobile platforms. Government-backed projects to increase the use of ICT in educational institutions, together with regulations in the healthcare sector that mandate a reduction in paper-based processes, are other major factors driving IT spending in this sector.

‘Combined Finance’ is the second-biggest vertical in the UAE with respect to business IT spending. Organizations in this vertical, which includes banking, insurance, and securities services providers, are predicted to invest $719.77 million in IT in 2014. The rapid expansion of branch and ATM networks, investments in online and mobile banking channels, and the need for better regulatory compliance are the primary drivers of ICT investments in the banking sector.

Consumer IT spending in the UAE is expected to account for 30.5% of total IT spending in 2014, though it will contract 8.4% year on year. This decrease in spending is a result of the stagnating PC market, which is being cannibalized by the growing demand for tablets.

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The one map your CMO must share with your CIO

IDC PMS4colorversion  The one map your CMO must share with your CIO

So many marketing solutions are available that it is very difficult for marketers, chief digital officers, and CIOs to have a holistic view of what they have, what they need and why. IDC has recently created a tool to help – The 2014 Marketing Technology Map. This tool provides a visualization of the different technologies needed to support different marketing organizations no matter how small or large, digital or non digital, modern or not. Pictured below is the whole map which presents solutions in four broad categories:
  1. Interaction: The primary function of these solutions is to be customer facing
  2. Content:  The primary function of these solutions is to facilitate the production and management of marketing content
  3. Data and Analytics: The primary function of these solutions is to store and produce insights from customer, operations, and financial data
  4. Management and Administration: The primary function of these solutions is to provide internal communications, workflows, budgeting and expense tracking.

View the map now… 

The Customer: The Most Important Statistic in Marketing – Everything Else is Just Offensive Rebounds

IDC PMS4colorversion  The Customer: The Most Important Statistic in Marketing – Everything Else is Just Offensive Rebounds

Let’s start with a story that relates to marketing today. When my brother in-law was trying out for his high school basketball team, the coach sat all the players down at the end of one practice and asked them, “What is the most important statistic in all of basketball.” My brother in-law, quite confident his answer would be correct, raised his hand and answered “Points scored.” The coach stared at him for a few seconds and responded, “No. Offensive rebounds.” For those of you who are familiar with basketball, you know that is a ridiculous statement – while offensive rebounds are important, the final score determines the winner, and thus is inarguably, the most important statistic in basketball.

For marketing, the customer is the final score

Today in marketing we are in an exciting phase with so much change happening, but also so much opportunity. The current atmosphere is a scary proposition for some, yet energizing for others. This energy has brought enthusiasm to many areas within marketing that are touted as “the most important.” While areas like marketing technology, big data and analytics, and content marketing are INCREDIBLY important, ultimately, they are only a portion of marketing and not the full picture. In the end the most important “statistic” is the customer. The buyer ultimately judges and scores you, so remember, how well you provide value to your customer will determine whether you win or lose.
Highlighting this customer focus, in our 11th annual marketing barometer survey we asked over 75 senior level marketing executives to “compose a tweet on the future of marketing.” We then took those answers and created a word cloud (see above). Low and behold, the two largest words that came up were “Customer” and “Buyer”. These executives, whether intentional or not, understand that the customer/buyer will determine the final score. So remember, while different marketing practices may have incredibly important functions, in the overall game of business, they are all just offensive rebounds.

IT Maturity Increasing Among MEA Manufacturers as They Embrace Technology in Bid to Drive Productivity and Competitiveness

IDC PMS4colorversion  IT Maturity Increasing Among MEA Manufacturers as They Embrace Technology in Bid to Drive Productivity and Competitiveness

16 Mar 2014

With Middle East and Africa (MEA) manufacturers showing considerable enthusiasm for IT and comfortably outspending their counterparts in Central and Eastern Europe, the sector is well set for a significant boost in productivity and increase in competitiveness, according to the latest findings released today by IDC Manufacturing Insights.

A recent end-user survey conducted across MEA by IDC Manufacturing Insights shows that manufacturers in the Middle East, in particular, now view IT as an area that can help accelerate their manufacturing maturity. To this end, more comprehensive and competitive IT strategies are being put in place in core MEA countries, and more mature decisions regarding IT environments are being made, with customer-oriented initiatives and integration across the enterprise resonating particularly strongly. IT solutions that can be developed around the core enterprise resource planning (ERP) suite are also being viewed as powerful tools for fulfilling key strategic objectives.

“MEA manufacturers are becoming more mature in their use of IT,” says Martin Kuban, IDC Manufacturing Insights’ lead research analyst for Central and Eastern Europe, the Middle East, and Africa (CEMA) “Ongoing industrialization and market optimism have translated into increased IT spending, which has helped to accelerate this process. IDC forecasts that 2014 will be a very dynamic year in terms of IT deployments in the MEA manufacturing vertical.”

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Server Market in Asia/Pacific Almost Breaches the US$10 Billion Mark in 2013, Reports IDC

IDC PMS4colorversion 1 Server Market in Asia/Pacific Almost Breaches the US$10 Billion Mark in 2013, Reports IDC

Singapore and Hong Kong, March 13, 2014 – Server revenues in Asia/Pacific excluding Japan (APEJ) region grew a modest 1.3% to total US$9,985 million in 2013, coming in just short of the magical US$10 billion mark, according to IDC.  The modest growth in 2013 was in sharp contrast to the heady 17% growth recorded in 2010 and 2011, fuelled by massive infrastructure buildout by Web 2.0 and cloud service providers in the PRC.  Despite the sharp deceleration in growth in 2013 compared to the previous years, server market in APEJ continued to outperform other regional markets on a worldwide basis.

“Strong adoption of server virtualization and cloud technologies in the enterprise segment, rapidly increasing appeal of public cloud providers for specific workloads, and growing interest in Integrated Systems were some of the key technology disruptions that impacted the server spending growth in 2013,” says Rajnish Arora, Associate Vice President of IDC’s Asia/Pacific Enterprise Computing Research.  “Global economic malaise, lack of aggressive economic reforms in emerging economies, and political turmoil coupled with upcoming federal elections in certain countries were some of the non-technology factors that stymied server spending growth in 2013.”

The PRC, which has increasingly become the bellwether and cornerstone of the APEJ server market since 2008, grew at a much more anemic pace in 2013.  The Web 2.0 and public cloud services providers such as Tencent, Baidu and Alibaba building hyper-scale datacenters, who were responsible for driving the heady demand for servers in the PRC for the past several years, took a breather in 2013 that impacted the spending growth.

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