Report: ICT Sector Finds Opportunities Despite Economic Uncertainty

A new study from Frost & Sullivan (News - Alert) has revealed that in spite of the uncertain economy certain information and communication technologies (ICT) segments are getting opportunities through the same uncertainty.

 

“ICT solutions that shift costs from a capital to variable component focus on productivity increases and cost reduction, and support organizational restructuring and acquisitions are likely to see growing demand,” says Andrew Milroy, ICT director at Frost & Sullivan.

 

Frost & Sullivan also predicts belt-tightening will increase investments in the sustainable technology initiatives - such as virtualization, videoconferencing, thin clients and power consumption modeling - as they are able to lower costs as well as boost green credentials.

 

The report adds though some projects are likely to be shelved, such as, Sustainable IT; outsourcing services, managed and hosted services; information management tools and services that support mergers and acquisitions are the areas that are going to see some advantages.

 

For instance, businesses, in order to cut the costs of spending, will reduce travel and will look for videoconferencing tools. The rise in conferencing technologies will allow a greater proportion of employees to work remotely from home, further cutting travel costs and emissions. Another flow-on effect will be the rise of new opportunities for providers of secure remote access solutions.

 

Like conferencing Software as a Service (SaaS (News - Alert)) would also see demand for them as organizations would not want the cost of owing and maintaining certain software and prefer to get them from SaaS providers.

 

The report adds that demand for IT outsourcing will increase with offshore outsourcing organizations likely to reap the greatest benefit due to their ability to provide the most significant cost advantage. However, the study cautions that contract terms can be expected to fall significantly.

 

Sectors that are predicted to do well include Customer Relationship Management (CRM) and business intelligence.

 

Frost & Sullivan stated that they offer opportunities to increase productivity through improved data management. The firm adds that the economic slowdown will also likely lead to some mergers and acquisitions of companies that plan to dodge the slowdown which could create significant opportunities for IT consulting and systems integration organizations.

 

Milroy adds, “Right now, ICT firms tend to assume the worst and are anticipating slower - if not falling - demand. We believe that there are opportunities for solutions and services that can help organizations to cut costs, change cost structures, or increase productivity. The challenge is for suppliers to recognize this and to package their offerings accordingly.”