All posts by David_H_Deans

Why legacy IT vendors are seeking cloud niche viability

Leading hyperscale cloud service providers continue to disrupt the traditional IT infrastructure vendor landscape, as more enterprise CIOs and CTOs expand their adoption of multi-cloud strategies that marginalise the remaining applications for on-premises data centres.

Legacy IT vendors that were reluctant to evolve their business model will now seek niche cloud market segments where they can differentiate their offerings. There's no viable growth path that's based upon hardware or software market status-quo assumptions. However, distinctive professional services are still a source of new opportunities.

Cloud computing market development

The worldwide public cloud services market is projected to grow 17.5 percent in 2019 to total $214.3 billion — that's up from $182.4 billion in 2018, according to the latest global market study by Gartner.

The fastest-growing market segment will be cloud system infrastructure services, or infrastructure as a service (IaaS), which is forecast to grow 27.5 percent in 2019 to reach $38.9 billion — that's up from $30.5 billion in 2018.

The second-highest growth rate of 21.8 percent will be achieved by cloud application infrastructure services, or platform as a service (PaaS).

"Cloud services are definitely shaking up the industry," said Sid Nag, vice president at Gartner. "At Gartner, we know of no vendor or service provider today whose business model offerings and revenue growth are not influenced by the increasing adoption of cloud-first strategies in organisations. What we see now is only the beginning, though."

Through 2022, Gartner projects the market size and growth of the cloud services industry at nearly three times the growth of overall IT services.

According to recent Gartner surveys, more than a third of organisations see cloud investments as a top three investing priority, which is impacting market offerings. Gartner expects that by the end of 2019, more than 30 percent of technology providers’ new software investments will shift from cloud-first to cloud-only.

This means that license-based software consumption will further plummet, while SaaS and subscription-based cloud consumption models continue their rise.

"Organisations need cloud-related services to get on-boarded onto public clouds and to transform their operations as they adopt public cloud services," said Mr. Nag.

Currently, almost 19 percent of cloud budgets are spent on cloud-related services, such as cloud consulting, implementation, migration and managed services, and Gartner expects that this rate will increase to 28 percent by 2022.

Outlook for cloud computing application growth

According to the Gartner assessment, as cloud computing continues to become mainstream within most organisations, technology product managers for cloud-related service offerings will need to focus on delivering solutions that combine experience and execution with hyperscale providers’ offerings.

This complementary approach will drive both the transformation and optimisation of an organisation’s IT infrastructure and operations. This vendor coexistence model is the multi-cloud market reality.

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How augmented analytics is turning big data into smart data

Smart data is generated by filtering out the noise from big data that's generated by media, business transactions, Internet of Things (IoT), and data exhausts from online activity. Smart data can uncover valuable commercial insights, by improving the efficiency and effectiveness of data analytics.

Furthermore, vast amounts of unstructured big data can be converted into smart data using enhanced data analytics tools that utilise artificial intelligence (AI) and machine learning (ML) algorithms.

Advancements in data processing tools and the adoption of next-generation technologies – such as augmented analytics used to extract insights from big data – are expected to drive the smart data market toward $31.5 billion by 2022.

Augmented analytics market development

Augmented analytics automates data insights gathering and provides clearer information, which is not possible with traditional analysis tools. Companies such as Datameer, Xcalar, Incorta, and Bottlenose are already focusing on developing end-to-end smart data analytics solutions to obtain valuable insights from big data.

"Markets such as the US, the UK, India, and Dubai have rolled out several initiatives to use AI and ML-powered data analytics tools to generate actionable insights from open data,” said Naga Avinash, research analyst at Frost & Sullivan.

Smart data will help businesses reduce the risk of data loss and improve a range of activities such as operations, product development, predictive maintenance, customer experience and innovation.

Frost & Sullivan’s recent worldwide market study uncovered key market developments, technologies used to convert big data to smart data, government programs, and the IT organizations applying data analytics. It also found use cases for smart data applications.

"The evolution of advanced data analytics tools and self-service analytics endows business users instead of just data scientists with the ability to conduct analyses," noted Avinash.

Technology developers can ensure much wider adoption of their solutions by offering in-built security mechanisms that can block attackers in real time. They could also develop new business models such as shared data economy and even sell data-based products or utilities.

Outlook for augmented analytics application growth

As an example of other application scenarios, various governments have already begun to use data analytics on 'open data' sets to solve issues related to smart city and municipal water crises. Other important growth opportunities for smart data solution providers include:

  • Employing augmented analytics and self-service data analytics tools, as they enable any business user to make queries, analyse data, and create customized reports and visualisations
  • Leveraging a data monetisation approach, as it allows businesses to utilize and bring value at every point in the data value chain
  • Adding new data analytics services to existing offerings, driven by enterprise CIOs and CTOs
  • Partnering with innovative smart data solutions providers (emerging startups) across the world. This will help companies enhance their implementation capabilities by leveraging open-source smart data solutions focused on enterprise data management and analytics
  • Collaborating with the government to address the digital transformation talent shortage and setting clear investment and data strategy goals

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How channel partners are driving hyperscale cloud growth

Hyperscale cloud service providers continue to leverage their low-cost advantage to drive growth. According to the latest worldwide market study by Canalys, Google Cloud was the fastest-growing cloud infrastructure vendor last year – up more than 90% year on year – increasing its share of the total market from 6% in 2017 to 8% in 2018.

The top four hyperscale cloud service providers accounted for 61% of the total market in 2018. Amazon Web Services (AWS) remained the leader on 32%, followed by Microsoft Azure with 17%, Google Cloud in third place with 8% and Alibaba Cloud with 4%.

Hyperscale cloud market development

Canalys reports that hyperscale cloud infrastructure services are in a period of sustained growth, with spending up 46% in 2018 to more than $80 billion. Expenditure is also forecast to surpass $143 billion in 2020.

More businesses are deploying a hybrid multi-cloud strategy, integrating multiple providers with their existing on-premises IT infrastructure. Canalys estimates 30% of cloud infrastructure services spend, just over $24 billion, went through the IT channel of distributors, resellers, service providers and systems integrators in 2018.

"AWS, Microsoft Azure, Google Cloud and Alibaba Cloud are all increasing channel investment to raise their profiles, as competition for enterprise customers increases and workload cloud migration diversifies," said Alastair Edwards, chief analyst at Canalys.

The channel will play a vital role for the cloud service providers, in terms of boosting their customer reach, from both a sales and technical perspective. But each of the hyperscale cloud service provider titans current partner reach, engagement and program maturity differs — with Google Cloud trailing both AWS and Microsoft Azure in all areas. Alibaba Cloud is further back, behind the leaders.

 

 

Canalys estimates the top three providers represented 65% ($16 billion) of the channel's total cloud infrastructure services business in 2018. Microsoft manages one of the largest channel ecosystems in the technology sector and its Cloud Solution Provider (CSP) program is the most mature among the cloud titans, according to the Canalys assessment.

Approximately 74% of revenue from Azure is estimated to come via its partners, which is by far the highest percentage in the sector. In contrast, AWS channel business accounts for around 15%, though its reach is growing rapidly, AWS having recruited over 35,000 partners to date, with hundreds a month wanting to join its partner program.

Canalys estimates that Google Cloud's channel business accounts for just over 25% of its $7 billion cloud infrastructure revenue. In spite of Google Cloud's rapid growth, its channel reach is relatively small, though it is trying a differentiated approach by being more focused on specific applications and verticals.

An estimated 13,000 partners have joined its partner program, of which just over 100 have achieved the highest-tier Premier Partner status, while less than a third of those have achieved a Specialization Partner designation.

Outlook for cloud channel application growth

In a recent Candefero channel survey, 20% of respondents think there is huge potential to working with Google Cloud, while 22% said they will work with other cloud service providers instead. Cloud computing service channel partners will continue to align with the market leaders.

That said, 44% of partners were intrigued to know more about partnering with Google. Their new leadership brings the experience of working with the largest enterprise customers. But to date, Google has not captured the broader channel where AWS and Microsoft are being more proactive.

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Why IT security solutions spending will reach $133.8 billion

Cybersecurity investment continues to be a top priority for most IT organizations. Worldwide spending on security-related hardware, software, and services is forecast to reach $103.1 billion in 2019 — that's an increase of 9.4 percent over 2018. The pace of growth will continue as industries invest heavily in IT security solutions to meet a wide range of cyber threats.

According to the latest market study by International Data Corporation (IDC), worldwide spending on IT security solutions will achieve a compound annual growth rate (CAGR) of 9.2 percent over the 2018-2022 forecast period and total $133.8 billion in 2022.

IT security market development

Three industries will spend the most on security solutions in 2019 — banking, discrete manufacturing, and federal or central government — will invest more than $30 billion combined. Three other industries (process manufacturing, professional services, and telecommunications) will each see spending greater than $6 billion this year.

The industries that will experience the fastest spending growth over the forecast period will be state or local government (11.9 percent CAGR), telecommunications (11.8 percent CAGR), and the resource industries (11.3 percent CAGR). This spending growth will make telecommunications the fourth largest industry for security spending in 2022 while state or local government will move into the sixth position ahead of professional services.

"When examining the largest and fastest growing segments for security, we see a mix of industries – such as banking and government – that are charged with guarding highly sensitive information in regulated environments. In addition, information-based organizations like professional services firms and telcos are ramping up spending, said Jessica Goepfert, program vice president at IDC.

Managed security services will be the largest technology category in 2019 with firms spending more than $21 billion for around-the-clock monitoring and management of security operations centers. Managed security services will also be the largest category of spending for each of the top five industries this year.

The second largest technology category in 2019 will be network security hardware, which includes unified threat management, firewalls, and intrusion detection and prevention technologies. The third and fourth largest investment categories will be integration services and endpoint security software.

The technology categories that will see the fastest spending growth over the forecast will be managed security services (14.2 percent CAGR), security analytics, intelligence, response and orchestration software (10.6 percent CAGR), and network security software (9.3 percent CAGR).

From a geographic perspective, the United States will be the single largest market for IT security solutions with spending forecast to reach $44.7 billion in 2019. Two industries – discrete manufacturing and the federal government – will account for nearly 20 percent of the U.S. total.

The second largest market will be China where security purchases by three industries — state or local government, telecommunications, and central government – will comprise 45 percent of the national total. Japan and the UK are the next two largest markets with security spending led by the consumer sector and the banking industry respectively.

Outlook for IT security application growth

Large and very large businesses will be responsible for roughly two-thirds of all IT security-related spending in 2019. These two segments will also see the strongest spending growth over the forecast with CAGRs of 11.1 percent for large businesses and 9.4 percent for very large businesses.

Medium and small businesses will spend nearly $26 billion combined on IT security solutions in 2019. Across the globe, consumers are forecast to spend nearly $5.7 billion on security-related products and services this year.

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How ‘AI at the edge’ is creating new semiconductor demand

As more CIOs and CTOs focus attention on selecting the best-fit IT infrastructure for their particular cognitive computing needs, vendors of semiconductor technologies are exploring new ways to optimize their investment in solutions at the edge of enterprise networks.

Revenue from the sale of artificial intelligence (AI) chipsets for edge inference and inference training will grow at 65% and 137% respectively between 2018 and 2023, according to the latest worldwide market study by ABI Research.

During 2018, shipment revenues from edge AI processing reached $1.3 billion, and by 2023 this figure is forecast to reach $23 billion. While it's a massive increase, that doesn’t necessarily favor current market leaders Intel and NVIDIA.

AI chipset market development

According to the ABI assessment, there will be intense vendor competition to capture this revenue between established players and several prominent startup players.

"Companies are looking to the edge because it allows them to perform AI inference without transferring their data. The act of transferring data is inherently costly and in business-critical use cases where latency and accuracy are key, and constant connectivity is lacking, applications can’t be fulfilled," said Jack Vernon, industry analyst at ABI Research.

Moreover, locating AI inference processing at the edge also means that companies don’t have to share private or sensitive data with public cloud service providers, a scenario that has proven to be problematic in the healthcare and consumer sectors.

That said, edge AI is going to have a significant impact on the semiconductor industry. The biggest winners from the growth in edge AI are going to be those vendors that either own or are currently building intellectual properties for AI-related Application-Specific Integrated Circuits (ASICs).

By 2023, it's predicted that ASICs could overtake GPUs as the architecture supporting AI inference at the edge, both in terms of annual vendor shipments and revenues.

In terms of market competition, on the AI inferencing side, Intel will be competing with several prominent AI startups – such as Cambricon Technology, Horizon Robotics, Hailo Technologies, and Habana Labs – for dominance of this market segment.

NVIDIA with its GPU-based AGX platform has also been gaining momentum in industrial automation and robotics. While FPGA leader Xilinx can also expect an uptick in revenues on the back of companies using FPGAs to perform inference at the edge, Intel as an FPGA vendor is also pushing its Movidius and Mobileye chipset.

Outlook for AI chipset applications growth

For AI training, NVIDIA will hold on to its current position as the market leader. However, other AI applications at the edge will likely favor alternative vendors.

"Cloud vendors are deploying GPUs for AI training in the cloud due to their high performance. However, NVIDIA will see its market share chipped away by AI training focused ASIC vendors like Graphcore, who are building high-performance and use-case specific chipsets," concluded Vernon.

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Enterprise demand for agile, data-centric architectures: The next wave of big data and analytics

Augmented analytics, continuous intelligence and explainable artificial intelligence (AI) are among the top trends in big data and analytics that have significant disruptive potential over the next three to five years, according to the latest worldwide market study by Gartner.

"The size, complexity, distributed nature of data, speed of action and the continuous intelligence required by digital business means that rigid and centralized architectures and tools break down,” said Donald Feinberg, vice president at Gartner. “The continued survival of any business will depend upon an agile, data-centric architecture that responds to the constant rate of change."

Gartner recommends that data and analytics leaders collaborate with senior business leaders about their critical business priorities and explore the ten top related trends.

Augmented analytics

Augmented analytics is the next wave of disruption in the data and analytics market. It uses machine learning (ML) and AI techniques to transform how analytics content is developed, consumed and shared.

By 2020, augmented analytics will be a dominant driver of new purchases of analytics and business intelligence (BI), as well as data science and ML platforms, and of embedded analytics. Data and analytics leaders should plan to adopt augmented analytics as platform capabilities mature.

Augmented data management

Augmented data management leverages ML capabilities and AI engines to make enterprise information management categories including data quality, metadata management, master data management, data integration as well as database management systems (DBMSs) self-configuring and self-tuning.

It is automating many of the manual tasks and allows less technically skilled users to be more autonomous using data. It also allows highly skilled technical resources to focus on higher value tasks.

Augmented data management converts metadata from being used for audit, lineage and reporting only, to powering dynamic systems. Metadata is changing from passive to active and is becoming the primary driver for all AI and ML.

Through to the end of 2022, data management manual tasks will be reduced by 45 percent through the addition of ML and automated service-level management.

Continuous intelligence

By 2022, more than half of major new business systems will incorporate continuous intelligence that uses real-time context data to improve decisions.

Continuous intelligence is a design pattern in which real-time analytics are integrated within a business operation, processing current and historical data to prescribe actions in response to events. It provides decision automation or decision support.

Continuous intelligence leverages multiple technologies such as augmented analytics, event stream processing, optimization, business rule management and ML.

Explainable AI

AI models are increasingly deployed to augment and replace human decision making. However, in some scenarios, businesses must justify how these models arrive at their decisions. To build trust with users and stakeholders, application leaders must make these models more interpretable and explainable.

Unfortunately, most of these advanced AI models are complex black boxes that are not able to explain why they reached a specific recommendation or a decision. Explainable AI in data science and ML platforms, for example, auto-generates an explanation of models in terms of accuracy, attributes, model statistics and features in natural language.

Graph analytics

Graph analytics is a set of analytic techniques that allow for the exploration of relationships between entities of interest such as organizations, people and transactions.

The application of graph processing and graph DBMSs will grow at 100 percent annually through 2022 to continuously accelerate data preparation and enable more complex and adaptive data science.

Graph data stores can efficiently model, explore and query data with complex interrelationships across data silos, but the need for specialized skills has limited their adoption to date.

Graph analytics will grow in the next few years due to the need to ask complex questions across complex data, which is not always practical or even possible at scale using SQL queries.

Data fabric

Data fabric enables frictionless access and sharing of data in a distributed data environment. It enables a single and consistent data management framework, which allows seamless data access and processing by design across otherwise siloed storage.

Through 2022, bespoke data fabric designs will be deployed primarily as a static infrastructure, forcing organizations into a new wave of cost to completely re-design for more dynamic data mesh approaches.

NLP conversational analytics

By 2020, 50 percent of analytical queries will be generated via search, natural language processing (NLP) or voice, or will be automatically generated. The need to analyze complex combinations of data and to make analytics accessible to everyone in the organization will drive broader adoption, allowing analytics tools to be as easy as a search interface or a conversation with a virtual assistant.

Commercial AI and ML

Gartner predicts that by 2022, 75 percent of new end-user solutions leveraging AI and ML techniques will be built with commercial solutions rather than open source platforms.

Commercial vendors have now built connectors into the Open Source ecosystem and they provide the enterprise features necessary to scale and democratize AI and ML, such as project & model management, reuse, transparency, data lineage, and platform cohesiveness and integration that Open Source technologies lack.

Blockchain

The core value proposition of blockchain and distributed ledger technologies is providing decentralized trust across a network of untrusted participants. The potential ramifications for analytics use cases are significant, especially those leveraging participant relationships and interactions.

It will be several years before four or five major blockchain technologies become dominant. Until then, technology end users will be forced to integrate with the blockchain technologies and standards dictated by their dominant customers or networks. This includes integration with your existing data and analytics infrastructure.

The costs of integration may outweigh any potential benefit. Blockchains are a data source, not a database, and will not replace existing data management technologies.

Persistent memory servers

New persistent-memory technologies will help reduce costs and complexity of adopting in-memory computing (IMC)-enabled architectures. Persistent memory represents a new memory tier between DRAM and NAND flash memory that can provide cost-effective mass memory for high-performance workloads.

It has the potential to improve application performance, availability, boot times, clustering methods and security practices while keeping costs under control. It will also help organizations reduce the complexity of their application and data architectures by decreasing the need for data duplication.

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How channel partners are set to drive new cloud computing growth

The worldwide cloud computing infrastructure market had another strong quarter in Q4 2018, as spending grew 46 percent to nearly $23 billion. The total outlay on cloud infrastructure in 2018 exceeded $80 billion – that's up from $55 billion in 2017 according to that latest market study by Canalys.

This investment makes cloud computing services one of the most important sectors in the IT industry, not just by the rate of growth, but also due to its expanding size.

Cloud computing infrastructure market development

Amazon Web Services (AWS) remained the dominant cloud service provider in Q4 2018; its market share of customer spend unchanged at 32 percent. Microsoft Azure grew its share to 16 percent against 14 percent in the same period a year ago. Google Cloud reached 9 percent for the first time, while Alibaba Cloud maintained its 4 percent share.

IBM, Salesforce, Oracle, NTT Communications, Tencent Cloud and OVH rounded out the top 10 cloud service providers.

"Cloud infrastructure services provide the core components needed to support digital transformation initiatives around building new customer experiences, deploying IoT to transform processes, using big data and analytics for better insights, and embedding machine learning and AI for automation,” said Matthew Ball, principal analyst at Canalys.

Market dynamics have changed over the last 12 months, with more businesses opting for multi-cloud and hybrid IT environments to use the strengths of different cloud service providers and deployment models dependent on application and data requirements, compliance, cost and performance.

The role of channel partners in cloud services is growing in importance as a direct result of these trends. In particular, understanding customer requirements, recommending services, deployment and integration, as well as simplifying the billing and management of multiple cloud services.

According to the Canalys assessment, cloud service providers are placing greater emphasis on building channel programs to support the growing network of partners beyond the largest systems integrators, especially as they extend to mid-market and SMB customers.

Canalys expects the share of cloud business supported by or with channel partners to increase in 2019. Cloud service providers must therefore find new ways to improve their own differentiation to partners and raise the maturity of their channel models.

Outlook for cloud channel partner innovation

Canalys expects a greater focus on rewarding partners with specialist expertise around specific cloud deployments, such as SAP HANA, analytics or security; on partners developing unique services on top of cloud; and on those driving customer adoption of cloud services.

Cloud service providers should build trust with their channel partners and not implement initiatives or change terms and conditions that drive more direct sales, according to Canalys. Instead, they must offer superior marketing resources that enable channel partners to differentiate hybrid multi-cloud service capabilities in this very competitive marketplace.

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Hybrid multi-cloud computing investment trends and CIO strategies

As more enterprise CIOs and CTOs embrace hybrid multi-cloud deployment strategies, business technology vendors and cloud service providers must continue to evolve their go-to-market approach – in recognition of the prevailing IT infrastructure investment trends.

Vendor revenue from sales of IT infrastructure products for cloud environments, including public and private cloud, grew 47.2 percent year-over-year in the third quarter of 2018 (3Q18), reaching $16.8 billion, according to the latest worldwide market study by International Data Corporation (IDC).

Cloud IT infrastructure market development

IDC also raised its forecast for total spending (vendor revenue plus channel mark-up) on cloud IT infrastructure in 2018 to $65.2 billion, with year-over-year growth of 37.2 percent.

Quarterly spending on public cloud IT infrastructure has more than doubled in the past two years reaching $12.1 billion in 3Q18 and growing 56.1 percent year-over-year, while spending on private cloud infrastructure grew at half of this rate, 28.3 percent, reaching $4.7 billion.

Since 2013, when IDC started tracking IT infrastructure deployments in different environments, public cloud has represented the majority of spending on cloud IT infrastructure and IDC expects this share will peak at 68.8 percent with spending on public cloud infrastructure growing at an annual rate of 44.7 percent. Spending on private cloud will also grow 23.3 percent year-over-year in 2018.

In 3Q18, for the first time, quarterly vendor revenues from IT infrastructure product sales into cloud environments surpassed revenues from sales into traditional IT environments, accounting for 50.9 percent of the total worldwide IT infrastructure vendor revenues, up from 43.6 percent a year ago.

However, for the full year 2018, spending on cloud IT infrastructure will remain below the 50 percent mark at 47.4 percent. Spending on all three technology segments in cloud IT environments is forecast to deliver double-digit growth in 2018. Compute platforms will be the fastest growing at 59.1 percent, while spending on Ethernet switches and storage platforms will grow 18.5 percent and 20.4 percent, respectively.

The rate of growth for the traditional (non-cloud) IT infrastructure segment slowed down from the first half of the year to 14.8 percent, which is still exceptional for this market segment. For the full year, worldwide spending on traditional non-cloud IT infrastructure is expected to grow by 12.3 percent as the market goes through a technology refresh cycle, which will wind down by 2019.

By 2022, we expect that traditional non-cloud IT infrastructure will only represent 42.4 percent of total worldwide IT infrastructure spending (down from 52.6 percent in 2018). This share loss and the growing share of cloud environments in overall spending on IT infrastructure is common across all regions.

"The first three quarters of 2018 were exceptional for the IT Infrastructure market across all deployment environments and the increase in IT infrastructure investments by public cloud data centres was especially strong driven by the opening of new data centres and infrastructure refresh in existing data centres," said Natalya Yezhkova, research director at IDC.

All regions grew their cloud IT Infrastructure revenues by double digits in 3Q18. Revenue growth was the fastest in Asia-Pacific (excluding Japan) (APeJ) at 62.6 percent year-over-year, with China growing at an even higher rate of 88.7 percent. Other regions among the fastest growing in 3Q18 included Japan (48.2 percent), USA (44.2 percent), and Canada (43.4 percent).

Outlook for cloud IT infrastructure investment growth

Long-term, IDC expects spending on cloud IT infrastructure to grow at a five-year compound annual growth rate (CAGR) of 13.3 percent, reaching $88.6 billion in 2022 and accounting for 57.6 percent of total IT infrastructure spend.

Public cloud data centres will account for 66.3 percent of this amount, growing at a 13.6 percent CAGR. Spending on private cloud infrastructure will grow at a CAGR of 12.6 percent.

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Cloud computing apps and mobile wearables converging: What is the next step?

Adoption of mobile internet access, combined with the development of innovative cloud services and wearable devices, has created a multitude of new consumer and business use cases that will drive demand, according to the latest worldwide market study by International Data Corporation (IDC).

Global shipments of wearable devices are forecast to reach 125.3 million units in 2018 — that's up 8.5 percent from 2017. The growing popularity of smartwatches and greater wearables adoption in emerging markets will combine to produce a five-year compound annual growth rate (CAGR) of 11 percent with shipments jumping to 189.9 million units in 2022.

Wearables market development

"The transition from basic wearables to smart wearables will continue over the next five years as the two approach parity in terms of market share by 2022," said Jitesh Ubrani, senior research analyst at IDC. "The rise of smart wearables will not just be in mature markets, but also from emerging markets in Asia-Pacific and elsewhere. Japan will play an equally important role as they consume more than one third of all smart wearables."

Among the smart wearable operating systems, Apple WatchOS will remain in the lead although its share will decline from 44.4 percent in 2018 to 35.8 percent in 2022 as other platforms gain traction. The second largest OS is expected to be Google Android with 22.4 percent share in 2022.

Android should not be confused with WearOS, as the open-source platform offers vendors an opportunity to customize the wearables' experience while creating differentiation. With Google's service being banned from China, many local brands have adopted this strategy and IDC anticipates the proliferation of these devices to continue in many neighboring countries as well.

Behind WatchOS and Android, WearOS will capture 19.8 percent share in 2022 as additional vendors begin to offer products and as the platform catches up to competitors in terms of features.

The remainder of the smart wearables landscape will be comprised of smaller platforms and vendors although IDC anticipates Samsung, Fitbit, and Garmin to dominate with their proprietary platforms.

According to the IDC assessment, we should expect further new developments focusing on healthcare, with the smartwatch playing a critical role in tracking our health goals and detecting potential ailments.

Outlook for wearables application growth

Watches are forecast to reach 72.8 million units in 2018 with smartwatches accounting for roughly two thirds of the total volume. Total watch shipments are expected to reach 120.2 million by 2022 with a CAGR of 13.3 percent.

Growth for the Wristband category will remain muted with a 0.3 percent CAGR from 2018 to 2022. However, it's important to note that this category will still account for 24.7 percent of the total market by 2022 with the total volume reaching 47 million.

Earwear, accounting for less than 2 percent of the market in 2018, is on track to capture a 6.8 percent share in 2022. Growth in this category is largely attributed to the disappearance of the traditional headphone jack on modern computing devices. Additionally, an increasing number of vendors are including biometric tracking into wireless headphones which will further help this category.

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How applications container revenue will reach $4.3 billion: Growth drivers and trends

The global market for server virtualization technologies has experienced relatively low growth as more CIOs and CTOs consider alternative approaches to support their developer's need for agile IT infrastructure deployment. While some early adopters are experimenting with 'serverless' solutions, the mainstream market is utilising software applications container solutions.

According to the latest worldwide study by 451 Research, the emerging applications container market will continue to expand and be worth more than $2.1 billion in 2019 and more than $4.3 billion by 2022 – that's a compound annual growth rate (CAGR) of 30 percent.

Application container market development

When 451 Research first published a forecast on the container market two years ago, there were 125 companies identified in their market analysis. Included in the most recent forecast is an examination of 184 vendors, which represents about a 50 percent increase from the number of vendors in late 2016.

While the revenue contribution from containers for the vast majority of participating vendors is still relatively small, the widespread interest in application container technology remains a defining feature of this emergent market.

Growth in the containers market and ecosystem is being driven by increasing enterprise interest to help application developers move faster, manage infrastructure more efficiently and meet digital transformation goals. That being said, serverless technologies have a similar goal with a cloud computing functions-as-a-service (FaaS) model.

According to the 451 Research analyst's market assessment, about half of enterprise organizations are either using application containers today or planning to use them in the next two years.

"The promise of container technologies to increase developer speed, efficiency and portability across hybrid IT infrastructures, as well as microservices, are all driving growth," said Jay Lyman, principal analyst at  451 Research. "Broader and deeper vendor participation along with increasing enterprise use indicate this market will continue to grow and as that growth continues, consolidation in the market is likely."

The market study also indicates that both startup vendors and established leaders within the enterprise software industry are addressing a variety of container use cases — such as management and orchestration, monitoring, DevOps, IT security, networking and storage.

Outlook for application container innovation

This is not only indicative of the broad applicability of container-based technologies but also highlights how revenue is spread across a diverse vendor landscape. Moreover, the openness of this market may encourage a variety of additional vendors to enter the container market and fuel further growth.

"The industry is already seeing these mergers and acquisitions that include IBM’s recent acquisition of Red Hat and VMware's purchase of Heptio. These recent deals demonstrate how the container market is ripe for more consolidation as well as growth," added Lyman.

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