Local enterprises are investing in virtualisation and cloud computing, as conditions in the technology industry are set to improve from last year's recession.
“Deloitte has picked up a lot of cloud computing activity in the Europe, Middle East and Africa region within the past nine to 12 months. Cloud computing is the next big thing and will change how organisations manage and view their cost base.”
So says Adrian Moorgas, technology director at Deloitte Consulting, who points out that IT organisations are searching for innovative technologies such as cloud computing and virtualisation to give them a competitive advantage.
He advises that IT budgets have a balance between non-discretionary spend; which focuses on keeping a business running, and on discretionary spend that provides strategic benefit such as cloud computing.
“In the past two years, a lot of companies are turning to virtualisation, especially some of the big banks. Virtualisation will continue, but it's an incremental way of optimising what you already have; while cloud computing is moving away from a capital expenditure to removing maintenance and upgrade costs.”
Growing market
The South African virtualisation market is expected to grow in spend by 18.9% this year, says Citrix. According to the company, this is an increase from the 3.7% spend in 2009.
Citrix, in particular, is bolstering its partnership with Microsoft to drive desktop virtualisation in the enterprise space. Citrix recently signed a deal with Microsoft to integrate the Citrix XenDesktop 4 with Microsoft System Centre and App-V for virtual desktops.
James Stevenson, area vice-president of Citrix Systems Ireland, UK and SA, predicts the strongest area for growth, coming out of the recession, will be in desktop virtualisation as the South African IT market is set to grow by 18.9% in 2010, and 39.4% in 2011.
Stevenson says: “This year, we are seeing a shift towards cost avoidance and deferred return on investment, enabling workforce productivity, simplification of the core, and consolidation of markets. These goals can be realised through desktop virtualisation.”
According to a Citrix survey, around 48% of respondents say they will adopt desktop virtualisation within 12 months, with that percentage increasing to 64% within 18 months.
Worldwide trends
Global research firm Gartner forecasts worldwide IT spending will reach $3.4 trillion this year; a 5.3% increase from IT spending in 2009.
Joanne Correia, managing vice-president at Gartner, explains that organisations are looking to shift spending from capital expenditure to operating expenditure. This is largely being driven by cost-cutting virtualisation technologies and hosted solutions.
"Because of this, vendors offering software-as-a-service, IT asset management, virtualisation capabilities and that have a good open source strategy will continue to benefit,” says Correia. “We also see mobile device support or applications, as well as cloud services driving new opportunities."
IDC analyst Hannes Fourie says: “From an IT priority point of view, last year has pressurised companies to do more with less and this drove a lot of CIOs to look at other technologies, such as cloud computing, to reduce their overall cost structure. We are also seeing a lot of CIOs looking to virtualise the data centre.”
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