Mobile, Cloud and Social Networking Will Define 2011's New Normal, Researcher Says

By D.H. Kass

December 7, 2010

A 6 percent uptick in worldwide IT spending to $1.6 trillion in 2011 will fuel meteoric growth in mobile computing, cloud services and social networking so as to push these new technologies more into the IT mainstream, according to researcher International Data Corp.

The researcher said that IT spending surges in mobile applications, cloud services and social business software will generate a frenzy of activity that frames a new market and opens up a plethora of industry-specific solutions.

"In 2011, we expect to see these transformative technologies make the critical transition from early adopter status to early mainstream adoption," said Frank Gens, IDC senior vice president and chief analyst.

"As a result, we'll see the IT industry revolving more and more around the build-out and adoption of this next dominant platform, characterized by mobility, cloud-based application and service delivery, and value-generating overlays of social business and pervasive analytics,” Gens said.

While hardware spending will remain strong at nearly 8 percent growth year-over-year, the IT industry will be sparked more by spending gains in software, project-based services and outsourcing, IDC said. Specifically, the researcher expects IT software spending to increase by 5.3 percent, project-based services spending to climb by 3.5 percent and outsourcing to move forward by 4 percent.

Emerging markets will also prod markets higher in 2011, accounting for more than half of all global IT spending, IDC said.

Newer technologies will be the primary beneficiaries of the boost in IT spending next year, as outlays for public cloud services is expected to grow by 30 percent over 2010, triggered by businesses moving more applications into the cloud, according to the researcher.

In particular, cloud adoption will spike among small- and medium-sized businesses (SMB), IDC said.

By mid 2012, unit shipments of smartphones, media tablets and other non-PC mobile devices capable of supporting applications will outstrip the number of PCs shipped by manufacturers, a trend that not only will set the future pace but also will pressure PC vendors to position themselves in the redefined marketplace, according to IDC.

Anticipated growth figures associated with mobile applications are eye-popping, as IDC predicts some 25 billion mobile applications will be downloaded in 2011, a 150 percent jump from 2010.

In addition, social business software in business settings is expected to move forward at a 38 percent compound annual growth rate (CAGR), the researcher said. By the end of next year, more than 40 percent of SMBs will use social networks for promotional purposes, IDC said.

IDC expects major software vendors will buy social software providers in greater numbers in 2011, either to kick start or boost their presence in the social business segment.

"What really distinguishes the year ahead is that these disruptive technologies are finally being integrated with each other, cloud with mobile, mobile with social networking, social networking with 'big data' and real-time analytics," said Gens.

"As a result, these once-emerging technologies can no longer be invested in, or managed, as sandbox efforts around the edges of the market,” he said. “Instead, they are rapidly becoming the market itself and must be addressed accordingly."