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Slowdown predicted

Simon Quicke

The global IT market is going to slow next year, with any impact of the US credit crisis expected to hit the hardware sector first.

According to analyst firm IDC's predictions for 2008 the areas for growth will be around the SME market, hosted services, web gadgets and Web 2.0 applications.

Frank Gens, senior vice president of research at IDC, said that those IT players that saw the current race to capture emerging markets, exploit the web and develop online community-led added value as just short-term fads would be left behind.

He added that those that were not prepared to open up technology and take part in the current wave of internet-based collaboration would also be in trouble as "disruptions" including emerging markets and the web made their impact.

"What has been seen as disruptions up to now will be embraced by the major vendors next year and so they will no longer be disruptions but become the rules," said Gens.

He explained that the cooling growth in established markets would force the major vendors to concentrate on emerging countries as they "hedged against the slowdown in the US and Japan".

"The second hyper growth emerging market is the SMB sector in emerging countries as well, with 10 per cent growth," he said.

Gens added that after a lot of talk in the industry about hosted services, 2008 would actually be the year when companies made the move, and they would be led by IBM and Microsoft and joined by Cisco and Google.

He said the channel played a crucial role acting as the "last mile", delivering the emerging products and services to customers.

"Suppliers will need to give the channel better configuration and delivery tools that include more software components that deliver the next generation of system integrators," he added.

Gordon Davies, CEO at Adepteq, said that the IDC predictions were already being underlined by the experience in the channel.

"SaaS is here to stay, end of story, and if anything I can see it increasing rapidly next year as customers like it," he said.

"Web 2.0 is almost a de facto standard and if you are not using those tools then you are lagging behind," he added.

But Davies questioned the excitement around the idea of partnerships between traditional IT vendors and CE and web-based players, pointing out that expanding the horizons was one of the moves that any business would need to make to remain successful.

One of the IDC predictions for next year is around the environment, with a mention of the impact of green on technology procurement.

Mike Norris, chief executive of Computacenter, said that energy was already a massive issue and outside of customers' traditional demands of wanting more for less, "energy consumption is the biggest issue of this year and will be next".

The data centre has been where the pressure has been felt most acutely but Norris said it was not just an issue for the City: "Retailers and energy companies have made a commitment to their customers and they want to be seen as environmentally friendly."

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