The next 12 months will be a time for consolidation and hard
bargaining as IT directors take on suppliers seeking stronger
revenue streams. Computer Weekly's writers assess which of the
short-term and long-term trends will give you the edge
Desktops
Daniel Thomas
The PC industry suffered its most turbulent year yet in 2001 with
sales falling for the first time in two decades. Although the
market may see the start of a recovery this year, the main
suppliers will continue to struggle to make a profit. While this
may not be good news for the likes of Dell and Compaq, it
represents an opportunity for IT managers to strike deals on
desktop hardware, particularly as chip manufacturers such as Intel
and AMD have also slashed prices to boost demand.
With Microsoft no longer supporting Windows 95, IT chiefs will have
to make a choice on desktop software - do they go for Windows 2000
or the newer, slightly improved Windows XP? The option of moving
away from the Microsoft platform altogether may prove particularly
appealing to companies that expect a hike in costs as a result of
the software giant's controversial licensing changes.
Many IT directors have said they are actively considering
alternatives such as Sun Microsystems' Star Office productivity
suite and the Linux operating system, and this may finally be the
year when open source software gains a foothold on the corporate
desktop.
Other alternatives are non-desktop PC technologies such as thin
clients - slimmed down terminals that leave most computing
functions to a central server - and wireless mobile devices. Thin
clients are becoming increasingly commonplace. American Express is
in the process of rolling out 25,000 thin clients across its
worldwide operation. Analysts suggest this implementation could be
a watershed for server-based computing.
Meanwhile, businesses are starting to see the advantages of mobile
devices over and above the traditional personal information
management capabilities. Analysts expect that Microsoft's Pocket PC
platform will drive further implementations as its features are
particularly suited for corporate use.
Public Sector
James Rogers
This year promises to be a busy time for the public sector. The
Microsoft licensing debate will figure prominently over the coming
months, with both central government and local authorities in the
UK working hard to negotiate deals with the software giant.
Government officials have confirmed that the Office of Government
Commerce (OGC) is negotiating with Microsoft to draw up a single
contract to supply Office and Windows software to nearly 500,000
civil servants. The NHS and the Ministry of Defence have already
signed similar agreements with Microsoft.
The Society of IT Management (Socitm), which represents local
government IT directors, has also been in talks to negotiate a
single software agreement with Microsoft for UK councils. A
spokesman for the group says a deal is likely to be signed this
spring and the society's officials are liaising closely with their
counterparts at the OGC on the Microsoft issue. Socitm estimates
that Microsoft's licensing arrangements, announced in May 2001,
could cost town halls as much as £80m over the next two years.
Councils will also be eagerly awaiting the next slice of
e-government funding from the Department for Transport, Local
Government and the Regions. The Government announced in December
that local authorities in England will receive £160m over the next
two years to help them to improve delivery of services using new
technologies. The money, which is subject to parliamentary
approval, is coming from £350m of government funds that have been
allocated to help councils meet the 2005 target for getting
services online.
Finally, the long-awaited National Air Traffic Services control
centre at Swanwick, Hampshire, will become operational on 27
January. The opening of the multimillion-pound centre has been
delayed for nearly six years by software integration
problems.
Communications
Antony Adshead
Broadband Britain will remain a catchy alliterative slogan with
little physical substance, as the UK is still in 11th place out of
the 13 OECD nations or 13th in Europe in terms of broadband
penetration, depending on the figures you choose.
About 70% of the population can now receive cable or ADSL but only
0.8% of the general public has taken the plunge. At the same time
business says it is hampered by the lack of broadband as a means of
corporate communication and as a channel to the buying public.
This logjam will persist until the achievement of critical mass.
But providers are not going to give access away and the public does
not yet see the need for it. The market wants seedcorn funds and in
the short term this can only be obtained by the Government showing
what is possible - treating high-speed Internet as a vital element
of the national infrastructure like gas, electricity or water - and
introducing tax breaks. The opportunity exists to lead the world as
an information society but will UK plc take the bold steps
needed?
Careers
Nathalie Towner
The slowdown in the IT jobs market is set to continue well into
2002. Despite this downturn in the economy it will not be any
easier to hold on to your most valuable IT staff and this period
should be used to motivate and train teams.
Even though most people are sitting tight at the moment, if they
feel they would do better elsewhere they will move on as soon as
the market picks up and this is the worst time to be losing
talented staff.
Research has shown that most ITers do not move on because of
inadequate salary and benefits but because they are unhappy with
management or feel that there are limited opportunities for
advancement. Investing in training will ensure staff loyalty when
you need it most.
Anticipating what training to give and what skills to develop is
part of this process. The Computer Weekly/SSP skills league table
predicts the rise of Microsoft's SQL Server and a major increase in
demand for Unix skills. C++ will continue to be the most valuable
programming language but developers should work on C# as demand for
this is expected to increase over the next two years.
Research has also indicated that boards will want more e-commerce
projects in 2002 and consequently demand will rise for customer
service, Web development and middleware skills.
Most importantly though, the opportunity to build a strong team for
when the economy picks up should not be missed.
IT Strategy and management
Ross Bentley
The first half of 2002 promises to be a tough time for everyone and
senior IT professionals are no exception. With money tight in many
sectors the emphasis will be on keeping costs down and
demonstrating return on investment.
However, with IT budgets so tight, it could be time to tackle those
tasks you were always going to do if only you had time, for
example, restructuring databases, archiving historical data,
documenting systems, auditing PC software and reviewing maintenance
agreements. These tasks usually require little or no expenditure
but by putting your house in order substantial cost savings can be
made.
Staffing issues will again be high on the agenda. Whereas the
much-vaunted skills crisis has abated, the challenge this year will
be to keep your remaining employees motivated and focused. Your
ability to lead and delegate will be tested.
You will need to keep your wits about you too as outsourcing and
software suppliers introduce new pricing models. But with suppliers
desperate to make sales, now is the time to negotiate some
advantageous deals.
Finally, IT will continue its drift towards the centre of most
organisations. If you have not already got the message, IT can no
longer remain in glorious isolation. Everything must be viewed in
terms of the business as a whole.
Julia Vowler
Recession is the dominant driver for
business strategy, and hence IT strategy for the next year. IT
spending is forecast to grow by only 6.9%. With only £64.5bn to
spend on IT, UK business will be demanding more for less from
corporate IT.
While reducing costs internally, for example, by consolidating
servers, campaigning against Microsoft's new licensing charges, and
shedding staff, some analysts, such as Gartner, are advocating a
gap-year for IT.
Value for money and customer service are the watchwords of one IT
director that will be echoed by many of his peers. But uncertainty
makes planning hard, say other directors. Tony Cornford, of the
London School of Economics, advises organisations to consolidate
e-business investments, since e-government will increasingly
validate the e-economy for consumers, and businesses want cheaper
channels to suppliers and customers.
Brace yourselves for yet more mobile computing as not only is the
technology developing fast but business will want to cut overheads
through hot-desking, ensuring that staff can log on and work from
any desktop. Be bold and tool-up with skills while the downturn
makes them plentiful, so that you can take off at speed in 2003
when IT growth will head for 10% again.
Financial services
Nick Huber
Last year was grim for IT in the financial
services industry and this year will probably be just as tough. The
sharp downturn in the economy will cast a long shadow over IT
projects and budgets have been held in check, prompting
redundancies among IT staff and lay-offs of consultants.
However, despite the widespread economic gloom, this could be the
year when long-predicted technologies and IT trends finally hit the
corporate and consumer mainstream.
Mobile payments and outsourcing will all see significant changes in
the year ahead as companies try to get to grips with wireless
technology and find new ways to reach customers, industry experts
predict.
It will also be the year when companies attempt to get better
returns from technologies such as customer relationship management,
which have so far promised more than they have delivered.
The big trend will be in mobile payments for small transactions and
this will be boosted by a draft European Commission directive last
year which will allow non-banks to issue electronic money. Vodafone
is already developing a mobile payment system to allow users to pay
for inexpensive items via their phones and other operators are
likely to follow.
Software
Eric Doyle
This is the year when 64-bit systems will
really start to make their mark. Intel is due to bring out its
McKinley chip, the grown-up version of its 64-bit chip
architecture, and Microsoft is expected to release the version of
Windows XP which will run on 64-bit servers. Those companies with
any budget still to be allocated will be evaluating where McKinley
can improve business and a new flock of servers will be launched to
celebrate 64-bit's move to the mainstream.
The big news, however, will probably centre on e-business platforms
with IBM and BEA continuing to build on their successes so far,
while Oracle, Microsoft, Sun and Hewlett-Packard jostle for
position in the chasing pack.
Linux will still struggle to make its mark in the higher end
business market while consolidating its hold in embedded systems
and servers. Thanks to Microsoft hiking up the cost of its licences
this year and its well-publicised systems security problems, even
the less adventurous financial services companies and public sector
organisations are now showing serious interest in open source
software.
Security
Bill Goodwin
Computer Weekly asked some leading experts
in IT security to predict what security issues will affect IT
directors in 2002. Peter Sommer, of the London School of Economics,
says the e-mail and Internet monitoring provisions in the
Government's emergency powers terrorist legislation will prove
unworkable. It will either have to be abandoned or reworked in a
way that will prove very unpopular with civil libertarians.
According to Thomas Raschke, a security analyst at IDC, smaller
companies will increasingly take advantage of off-the-shelf
plug-and-play security packages. Lower equipment prices will
encourage these companies to improve their security.
The spread of wireless devices will create new problems for IT
directors, he says, and laptops, personal digital assistants and
mobile phones could open up new back doors into company
systems.
Sophisticated Windows worms will take over from e-mail macro
viruses as the biggest headache for businesses, says Graham Cluley,
of anti-virus specialist Sophos. They will use shape-changing
technology to escape detection. More virus writers will turn their
attention to developing Unix viruses.
Security consultant Chris Sundt says companies will begin
experimenting with improved versions of public key infrastructure
(PKI). These will have improved trust models and will take over
from more traditional PKI.