26 April 2009

The Future of ICT

It is worth thinking about the future from time to time. It helps us craft investment strategies and career paths that match the major trends in the world. So what is the future of ICT?

My guesses are
  1. Simplification.
  2. Movement to the cloud.
  3. Fixed/mobile convergence.
  4. Integration of simple cloud services. (1+2)
threesixtyfive | day 244
Modern ICT systems are insanely complex while the most productive computer users I know all use simple tools. 
Most of the things we do we with computers are much simpler than the popular packages are capable of. e.g. Editing some text does not require a full blown desktop publishing program like MS Word, yet MS Word is the most popular text editor in the world. Likewise keeping track of some customers and inventory does not require a gigantic package like SAP, yet SAP is the biggest selling ERP software package in the world.
Modern Times
The costs of learning these immensely complex packages are considerable in terms on time lost. There is probably a much higher cost in working as slaves to these packages which distracts from finding the best solutions to an enterprise's problems. A current trend in corporate ICT is to use "best of breed" packages with the minimum possible customization because the payback from customizing is much less than the cost. (BTW, this does not seem to be true for ERP). This means that enterprises that enterprises are paying the cost of  not solving their ICT problems as well as they could. This cost has to be a significant fraction of their ICT budgets.
What is ERP anyway? (MS&T ERP Center, 01/29/2009)
This article explains why "best of breed" software packages sell well. It boils down to the promise of lower total cost of ownership (TCO) through using a single vendor for all services and a mega-brand that makes buyers feel safe. 
SAP ERP systems effectively implemented can have huge cost benefits. Integration is the key in this process. "Generally, a company's level of data integration is highest when the company uses one vendor to supply all of its modules." An out-of-box software package has some level of integration but it depends on the expertise of the company to install the system and how the package allows the users to integrate the different modules.
Movement to the Cloud
Centralized computing is much more efficient than desktop-centric computing. TCO decreases dramatically with centralization because maintaining and upgrading software running in one physical location is far easier than on many people's personal computers. 
Most client software, even computationally intensive software like high quality graphics, has very low duty cycles. It does nothing most of the time. When you buy expensive PC hardware to support it, you are paying to support peak usage, the few minutes per day when it does the tricky computations and you want the user interface to be responsive. The average computer resource usage of this software is very low, much less than 10%. Therefore running the software on a central server is much more the 10x more efficient.
Expensive infrastructure such as high-reliability disk storage does not need to be replicated through an organization. Virtualization, SaaS etc only became effective in the last few years so many software and hardware vendors built their (then efficient) businesses around powerful client PCs running software locally.

Fixed Mobile Convergence 
Skype Crashing on iPhone Fix
When simple applications and cloud computing become dominant, the requirements for terminals become much less. Smart phones and 3G netbooks are already very capable and are becoming more so. They also use little power and are portable.

The next level of usability is to have one device for fixed and mobile work. That device should be able to work with WiFi and 3G networks and move seamlessly between them. The technology for this is maturing.

From Wikipedia
A clear trend is emerging in the form of fixed and mobile telephony convergence (FMC). The aim is to provide both services with a single phone, which could switch between networks ad hoc. Several industry standardisation activities have been completed in this area such as the Voice call continuity (VCC) specifications defined by the 3GPP. Typically, these services rely on Dual Mode Handsets, where the customers' mobile terminal can support both the wide-area (cellular) access and the local-area technology (for VoIP). However, an alternative approach achieves FMC over 3G mobile networks - eliminating the requirement for Dual Mode. This approach, broadly termed cellular FMC, is in trials by telecoms operators including BT.
An alternative approach to achieve similar benefits is that of femtocells .
Integration of simple cloud services
When cloud computing is widespread and simple cloud services are widely available, integration  companies will be able to assemble tools to meet the needs of businesses. This should be a vast business since it competes with the mega-apps Microsoft, Oracle, SAP, Siebel etc and the mega-glue Tibco etc.

If the recent history of software development is a guide, nimble companies will start to build effective suites and grow rapidly to  form a foundation for this industry, then they will be followed by specialist companies who will take care to make their software inter-operable. This will evolve into a software ecosystem and sales channels will emerge. With fixed mobile convergence in the mix, application stores may be used for sales, removing the need for sales and marketing teams in the startup companies that start this new business category.

At this time  the setups of hyper-productive software users will be easy to replicate in the cloud. User applications will  be available to users as simple serices on simple devices like 3G netbooks. Enterprise applications will run in the cloud with simple interfaces. Business outsourcing will be simple because the software will run in the cloud with well-defined APIs.

The Consequences
  1. These changes will result in a dramatic increase in productivity that will boost economies world-wide.
  2. Software will be simple so ICT staff will not be slaves to the machines of gigantic software packages.
  3. This will free up ICT staff's time to add business value which will increase productivity even more.
Photo Credits
threesixtyfive | day 244 by Sybren A. Stüvel.
What is ERP anyway? (MS&T ERP Center, 01/29/2009) by MS&T Center for ERP.
Skype Crashing on iPhone Fix by theleetgeeks.
Modern Times by jampa.

1 comment:

Simple Simon said...

See http://opengardensblog.futuretext.com/archives/2009/05/the_myth_of_mob.html