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Gartner Releases Hype Cycle for Networking and Communications, 2011

It is ironic that a framework meant to define the relative level of hype associated with new technologies adds in seven new ones, an increase of 20% within just a year.

Are all those technologies really significant enough to be included in a framework whose purpose is to cut through hype?   With less than 1% adoption throughout enterprises for over 50% of these technologies, it may be time for a more rigorous screening process.

After reading this Hype Cycle several dominant themes emerge. They include modernization of IT infrastructure to support greater scalability and security, consolidation of IT hardware investments, recognition of hybrid clouds being a central part of networking strategies, and location-based technologies having the potential to re-define logistics, supply chain and customer service strategies.  That’s a lot of ground to cover in a single Hype Cycle, and to be fair, Gartner says this is an aggregated view of the market.  Yet there is still the issue of technologies being included that have not shown any real value to enterprises yet.

Presented below is the Hype Cycle for Networking and Communications, 2011 and key take-aways.

Source:  2011 Gartner, Inc.  Hype Cycle for Networking and Communications, 2011 David A. Willis, Publication Date: 24 August 2011 ID Number: G00216400

Key Take-Aways:

  • Gartner is predicting the technologies that will experience the fastest growth include Virtual I/O, Gigabit Ethernet, Long-Distance Live Virtual Machine Migration, Energy Efficient Ethernet,  Context Delivery Architecture, and Video Telepresence.
  • Hosted Virtual Desktops, OpenFlow (technology also known of as software-defined networking (SDN), Transcoderless and Software-Based Videoconferencing Infrastructures, Mobile Enterprise Applications via SaaS, 802.11ad (Wi-Fi at multi-Gigabit speeds) , 802.16-2009 (consolidates dated WiMAX standards) and Mobile Satellite Services are the latest technologies Gartner has added to this Hype Cycle.  Of these, Mobile Enterprise Applications with SaaS have the most significant potential effect on Total Cost of Ownership (TCO) on CRM and customer-facing enterprise applications.  None of these have greater than 1% adoption in the enterprise today however.
  • Gartner is projecting over 1B smartphones and media tablets will be sold globally by 2015.  This explosive growth is forcing enterprises to react much faster than they initially expected to mobile security, mobile device management, and application support is an essential services.  A recent survey completed by Gartner indicates that CIOs fully expect to support up to three mobile operating systems by 2012 and that 20% of devices will be employee-owned by that year.  Presented below is their forecast for smartphones and media tablets through 2015. The following forecast is from their report, Emerging Technology Analysis: Mobile Business Intelligence, 13 July 2011, ID:G00214124 by Bhavish Sood, Andreas Bitterer, James Richardson.
Worldwide Smartphone and Media Tablet Shipments, 2010-2015
  • Mobile Enterprise Applications via SaaS will see the greatest growth in vertical or specialized and Small & Medium Business (SMB) segments.  It is evident from their analysis that TCO estimates may confuse enterprise buyers into thinking initial set-up costs for SaaS will lead to a lower price than licensed, premise-based applications.  This will not always be the case despite the hype around SaaS economics today.  This Hype Cycle could have been stronger and more prescriptive for enterprise IT buyers by discussing SaaS economics in greater detail.
  • Gartner goes into great depth on location-aware technology yet doesn’t make that convincing of a connection to enterprise-level strategies, initiatives and programs.  There is much technological discussion on GPS, assisted GPS (A-GPS), Wi-Fi, Enhanced Observed Time Difference (E-OTD) and Enhanced GPS (E-GPS) yet hardly any analysis of how this fits into the enterprise.
  • Gartner sees the majority of enterprise cloud-based systems being hybrid.  The Hype Cycle provides a glimpse into private and public clouds being integrated together for workload sharing.  There needs to be more focus on how this will work for a business process standpoint to be of value however.
  • Mobile consumer application platforms (MCAPs) will increasingly become multi-platform based.  Gartner is predicting that Messaging-Based, Browser-Based, Thick Clients/Rich Clients and Streaming Audio/Video will dominate consumer application platforms within the next two years.  They also see this area as the most transformational of all technologies analyzed in the Hype Cycle.

Bottom line: The best way to deflate hype in any industry is to insist on real, measurable results.  From choosing communications and networking solutions to including nascent technologies in a research framework, results attained by real customers are all that really matter.

SaaS-based Analytics and Business Intelligence Market Update, August 2011

Challenging, uncertain economic times accelerate sales cycles and lead to more closed deals for business intelligence software providers.  Companies get an urgency to reduce costs and risks, relying on the insights gained from these applications.

There’s an interesting dichotomy starting to emerge in how experts and analysts define just how these markets will mature however.  Both agree that economic uncertainty are growth catalysts yet they diverge on adoption rates, roadblocks, and which analytics and BI technology will dominate in the years ahead.

This week I read Balancing Custom And Packaged Apps In Your Application Portfolio Strategy by George Lawrie, Mike Gilpin and Adam Knoll from Forrester and the latest Hype Cycle of Business Intelligence, 2011 by a collection of Gartner authors led by Andreas Bitterer.  I’ve summarized the key points of each below.

Forrester Sees SaaS Applications Overtaking Custom Application Development

Forrester sees SaaS-based applications starting to replace in-house custom application development, gathering momentum through 2013.  Gartner, with their Hype Cycle for Business Intelligence, 2011 just released this week, shows BI platforms having greater near-term benefit than SaaS-based analytics and BI.  Custom application development projects are going to face continued pressure to keep up with business requirements that SaaS applications are proving able to handle more effectively and economically than ever before.

In-house development makes more sense for specific analytics and reporting requirements,  yet will continually be eroded by SaaS-based applications that can meet most requirements at a lower cost.  Forrester has in the past said SaaS-based adoption of analytics applications in general and predictive applications specifically would be very slow due to data integration challenges.  This study points to a potential shift in their mindset, as the data shows SaaS-based analytics beginning to replace custom in-house developed applications.

Here are the key take-aways from the report:

  • Analytics processes are supported 79% of the time with custom application development.  Procure-to-pay (33%) and record-to-report (33%) are the second-most supported.  Multiple responses were allowed in the survey.
  • When asked which process areas they are automating with SaaS, analytics (33%), record-to-report (18%), order-to-cash  (15%), and purchase-to-pay (12%) were the most common responses.  There was a small sample size on the Forrester report and the most startling insight was how quickly respondent companies plan to migrate from custom application development to SaaS-based analytics and BI.
  • Nearly 50% of the respondents to the Forrester survey have between five and 19 SaaS-based applications today with 18% expecting to have 35 or more by 2013.  In addition 63% of respondents expect to deploy between five and 34 SaaS-based applications by 2013, a significant shift in just two years.
  • 36% of survey respondents say their  SaaS applications run completely standalone.  Another 36% mention they use a combination of on-premises Master Data Management (MDM) and process integration tools.  Ironically only 3% are deploying their applications on cloud-based MDM or process integration-based platforms.

Gartner’s Hype Cycle for Business Intelligence, 2011

Unlike the hype cycle for cloud computing, this hype cycle has fewer technology categories (25), a narrative firmly grounded in business process and strategy, and more practical and pragmatic insights versus just theoretical.  At 50 pages it’s  quick read and while there are many excellent points made, I have summarized the key take-aways pertaining to the highest hype points and SaaS adoption below:

  • Mobile Business Intelligence (BI) is the latest entry to the Hype Cycle for Business Intelligence based on the massive hype around analyzing locational and application data.  The hype surrounding the Apple iPad Series, Google Android and other tablet and smartphone platforms has made this one of the most hyped areas of the last year according to the analysis.
  • Consumerization, Decision Support, analysis of non-traditional data and “Big Data” are the areas of the greatest innovation today.  The hype cycle points to search, mobile, visualization and data discovery being the catalyst of Consumerization.  Predictive analytics, which is on the Slope of Enlightenment on this latest hype cycle, is critical to decision support.  The non-traditional and “Big Data” area of innovation is further supported by content, text analytics, in-memory DBMSs and columnar DBMSs.
  • SaaS-based Business Intelligence is at the apex of the Peak of Inflated Expectations yet will continue to have low adoption rates.  Gartner believes that the  lack of trust in third parties managing confidential data, and the inertia and fear many companies have in moving to a new architecture are slowing adoption.  This is in contrast to the survey Forrester released this week showing analytics being one of the most popular SaaS-based applications planned by 2013 in their base of respondents.
  • Gartner sees SaaS-based Business Intelligence of the most value to midsize and smaller organizations who lack IT staff yet have very specific, targeted information needs.  Website analytics, social media monitoring, dashboards, predictive analytics and Excel as a BI front-end all apply.  Both Forrester and Gartner agree on this point and see this type of custom development going away quickly internally.
  • There is a massive amount of hype surrounding in-memory computing, particularly from SAP at its Sapphire conferences .  Gartner believes that SAP’s vision of in-memory computing exceeds  in-memory analytics to include analytical and transactional processing.  As a result, In-Memory Database Management Systems are at the Peak of Inflated Expectations.


Source: Hype Cycle for Business Intelligence, 2011, Published 12 August 2011 | ID:G00216086 By Andreas Bitterer.  Gartner, Inc.

What Both Agree On

Forrester’s survey shows SaaS eventually replacing custom application development while Gartner’s Hype Cycle for Business Intelligence shows the practical, pragmatic technologies including dashboards, predictive analytics combined with the more complex Business Activity Monitoring (BAM), Business Intelligence Platforms, and Data-Mining Workbenches delivering the most value.  Despite these differences, both agree on the following:

  • The overall market for BI, Analytics and Performance Management continues to grow at between 8 to 12% per year depending on the forecast used.  The following forecast is from the report  Market Trends: Business Intelligence, Worldwide, 2011-2014, 7 June 2011 | ID:G00213483 by Dan Sommer and James Richardson.
Source: Market Trends: Business Intelligence, Worldwide, 2011-2014, 7 June 2011 | ID:G00213483 by Dan Sommer and James Richardson
  • 2011 continues to see large, strategic deals for analytics and BI closing more rapidly than they have in the past.
  • SaaS-based analytics and BI continues to gain a greater share of spending in midsize and smaller companies.  Both also agree that the proliferation of smaller SaaS-based analytics and Bi vendors concentrating on a specific niche have successfully displaced in-house custom development of competitive applications.  Trust in the smaller vendor, their track record, customer references and financial viability are what are winning deals for SaaS-based analytics and BI software providers today.
  • The market transition from build to buy is now in full force as budgets become available again.  This is key assumption of both analyses and means that smaller, more niche-oriented SaaS-based analytics and BI vendors stand a chance to get new reference accounts and grow, despite a challenging economy.

Oracle Files Suit Against Oasis Research LLC Over Cloud Computing Patents

Oracle chose to go on the offensive today against Oasis Research LLC, who accused the company of violating six different patents in the development, marketing and service of Oracle On Demand, Oracle CRM On Demand and other applications.

Oracle chose to file their suit against Oasis Research LLC in Delaware federal court, seeking both a declaratory judgment of noninfringment and invalidity of six U.S. patents.  On May 26th, 2011 counsel representing Oasis Research sent a letter to Oracle alleging  the enterprise software company of “utilizing and benefiting from technologies and features covered in Oasis’ patents”.  According to the complaint filed in Delaware federal court, Oasis alleges that Oracle is offering for sale, selling, maintaining and supporting various online fee-based SaaS products including but not limited to Oracle On Demand and Oracle CRM On Demand based on Oasis patented intellectual property.  The letter concluded with Oasis demanding licensing agreements and fees from Oracle.

Oasis Research did not invent the technologies mentioned in this suit, they were acquired from Intellectual Ventures Computing Platform Assets LLC.  Oracle alleges in the complaint that the primary business model of Oasis is to obtain licensing revenues based on the inventory of patents they own, arguing that lack of investment in these technologies limits their patentability.

The six patents named in the complaint include the following:

  • U.S. Patent No. 5,771,354 pertains to an Internet online backup system that provides remote storage for customers using IDs and passwords that are interactively established when signing up for backup services.  This patent was originally issued on June 23, 1998.
  • U.S. Patent No. 5,901,228 refers to commercial online backup services that provide transparent extended storage to remote customers over telecommunications links.  This patent was issued May 4, 1999.
  • U.S. Patent 6,014,651 refers to commercial online software distribution systems and methods using encryption for security.  This patent was issued January 11, 2000.
  • U.S. Patent 6,327,579 defines online services including help desk, anti-virus and/or application service features   This patent was issued December 4, 2001.
  • U.S. Patent 6,411,943 defines an Internet online backup system that provides remote storage for customers using IDs and passwords which were interactively establish when signing up for backup services.  This patent was issued June 25, 2002.
  • U.S. Patent 7,080,051 defines Internet download systems and methods providing software to Internet computer users for local execution.  This patent was issued July 18, 2006.

Oracle alleges in the compliant none of these patents have been infringed, seeks relief from the licensing attempts by Oasis, and also seeks a declaration that one or more of the patents-in-suit fail to meet the conditions of patentability.  Oracle is also seeking coverage of all costs, expenses, disbursements and reasonable attorney fees.

Conclusion

Given the amount of hours attorneys at Oracle, SAP, Microsoft, Infor and many other enterprise software companies are going to log in the next several years over patent infringement, it makes sense to create an application to streamline contract, patent and legal processes.  It’s a perfect application for a database company to build, and lends itself well to analytics and reporting all delivered via the SaaS platform. Litigation burns thousands of hours, millions of dollars, is a major distraction to any business and taken together form a set of requirements ideal for these companies to tackle with what they do best: develop applications to solve complex business problems.

Sources: (free opt in required) http://www.law360.com/ip/articles/262334/oracle-files-pre-emptive-suit-over-cloud-computing-ip

 

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