It's been a year of innovation and disruption. Virtualization is changing the data center, social media is redefining corporate transparency and Software as a Service (
Virtualization was the hottest tech buzzword of 2006 and it will be smoking in 2007. There's a lot to like about dramatically improving server utilization rates while enhancing control and management of IT resources. Server virtualization could also be a major step forward in security. As usual, the industry is way out in front of its customers on this, and you can expect battles over standards and market leadership to erupt. In the meantime, users will tiptoe cautiously into a virtualized world. But this concept has a lot of staying power.
You've heard about IT-business alignment for years. This time is different, though. Chastened by the budget cuts of the last recession, IT managers are now thinking in terms of how to support the business rather than how to reinvent the business. It's a big difference and probably more realistic. You can actually be an innovative IT leader, even if your job is just to keep the lights on.
While the investment world frets over whether Web 2.0 is the next Internet bubble, a revolution is quietly going on behind corporate firewalls. The tools of social media -- blogs, wikis, podcasts and online video -- are being used internally by business users to improve collaboration, speed up project schedules and improve corporate memory. Users love the ease with which they can set up blogs and wikis to communicate with each other and with partners. But they won't necessarily cut IT in on the action. For all the benefits that social media tools offer, they could become an out-of-control nightmare for IT organizations that don't throw a rope around them.
I've long been a skeptic about Linux as a serious alternative to Windows on the desktop, and I still think that will never happen in the U.S.. However, some trends are converging to make the open source operating system a major player offshore. New distributions like Ubuntu Linux are as easy as Windows to install and use. Also, the One Laptop Per Child project that has been incubating for several years will ship its $100 product in 2007. It's possible that hundreds of millions of children will grow up using Linux, making them tough customers for a commercial operating system. Unless you're a gamer or you depend on a handful of brand-name software products that run only on Windows, then the combination of Linux, OpenOffice, Firefox and Thunderbird will satisfy your needs just fine.
Seven years ago, San Francisco-based Salesforce.com Inc. rejuvenated the dying application service provider market with its hosted CRM service. Today, Salesforce.com is worth $4.5 billion and there are hundreds of companies springing up using the model now known as SaaS. Software venture capitalist Ann Winblad recently told me that every new business plan she sees for application software companies now calls for a SaaS delivery model. Users love the simplicity and time-to-productivity benefits, but IT organizations are still mostly resistant. Lots of issues need to be worked out, but this model is here to stay, whether IT likes it or not. And on that note…
Maybe this won't happen entirely in 2007, but it's hard to see many obstacles to Salesforce.com's continued success. The company will step up its acquisition activities in the new year, diversifying its product line into mainstream accounting applications and possibly collaborative software. Its App Exchange integration platform will become the leading choice for third-party developers. Salesforce.com is positioning itself to become the power broker in SaaS. At this point, you've got to like its chances.
One analyst firm recently predicted that three-quarters of corporate desktops would be using Voice over Internet Protocol (VoIP) within three years. That may be optimistic, but you only have to look at the list of blue chip companies now doing large-scale rollouts to realize that VoIP is mainstream. Now the action moves on to applications, which is when things really get interesting.
Its stock has barely moved in five years, it's being trounced on the Web by Google and it faces a slew of open source competition. Hard to believe that not long ago, Microsoft was considered a monopoly. The company is responding in all the right ways, but it no longer has the leverage with Windows it once did. Efforts to reach out to the open source community and become a gentler and more approachable company are praiseworthy, but Microsoft faces formidable challenges in nearly every market and an uncertain future. In 2007, look for a big push in the enterprise along with a new focus on collaboration.
In most companies, information and physical security have historically been separate disciplines. That's all going to change. As the devices and people used to secure physical assets are digitally enabled, it will become more compelling than ever for the two functions to be combined. After all, shouldn't your surveillance cameras connect to facial recognition software? With IT playing an increasingly important role in compliance, organizations will start to merge their physical and info security operations under the CIO. This will create an unholy battle in many companies, but it's the right thing to do.
And finally, one big Hail Mary prediction:
It's not so far-fetched. Google's $140 billion market capitalization gives it the bank account to pick up the company that epitomizes the "long tail." Google's own excursions into online commerce have been largely unsuccessful, and eBay would give it not only the world's largest online market but also the leading payment system with PayPal. There is almost no overlap in the businesses, but many eBay customers advertise on Google. Combine the two companies, and thousands of merchants become almost wholly dependent on Google for their livelihood.
Paul Gillin is a technology writer and consultant and former editor-in-chief of TechTarget. His Web site is www.gillin.com.