August/September 2006
Welcome to IDC's Asia/Pacific Insider, the monthly newsletter delivered by IDC to inform registered users about IT market trends and drivers in the region, as well as keep you up to date on the latest IDC Asia/Pacific market intelligence. For more information on IDC's Asia/Pacific Research, please contact Kimberly J. Fraser at 650-350-6491, or via email: kfraser@idc.com.

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Featured Press Releases
 
Bill Rojas, Research Director, Asia/Pacific Communications Research
Ullrich Loeffler,Market Analyst, Software Research, IDC New Zealand
3G Licensing is Instrumental in Driving the Mobile Network Equipment Market in China, India and Korea, says IDC

Singapore and Hong Kong, August 10, 2006 - China, India, and Korea accounted for 78% of total mobile subscribers in the Asia/Pacific (excluding Japan) or APEJ region in 2005, up from 76% in 2004. The total mobile equipment capital expenditure (capex) in the three markets of China, India and Korea increased 17% in 2005 to reach US$14.93 billion from US$12.76 billion in 2004. More details can be found in IDC's latest report "China, India and Korea Mobile Carrier Capital Expenditure 2006-2010 Forecast and Analysis". (Doc#AP204104N)"The APEJ region is a world leader in 2G and 3G mobile services, broadband generic DSL (xDSL) access, long-haul optical transport, long-distance VoIP, and limited mobility services," says Bill Rojas, Director for Asia/Pacific's Telecom Research. "China and India will continue to drive the bulk of fixed-line growth in the region but fixed-wireless substitution has tremendous potential in a number of markets including China, India, Indonesia, and the Philippines."

*To view the full article, please click here
Infrastructure Management End Users See Budget Constraint as the Greatest Challenge, Says IDC

Singapore and Hong Kong, Aug 31, 2006 - Based on an extensive online survey on investment plans for infrastructure management and storage software in Asia/Pacific (excluding Japan), IDC found that end users of infrastructure management software are continuing to adopt technology for greater efficiency and effectiveness. Over 63% of respondents see the software as an important investment purchase. These include systems management, network management and storage software. "Heterogeneous storage environments resulting from departmental, branch, or post-merger consolidation present challenges to end-users; as such, IDC expects the storage management software investments to be a critical priority moving forward. However, the end-users do meet some challenges," says Ullrich Loeffler, Market Analyst, Software, IDC New Zealand.

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Asia/Pacific Research Update – August 2006
Personal Computing
Asia/Pacific: Thin Client Market Analysis and Forecast 2005-2010 - Doc #AP1051S6N Asia/Pacific: Thin Client Market Analysis and Forecast 2005-2010
2006 Portable Music Survey: MP3 Player Ownership and Usage Practices Among Consumers in Asia/Pacific (Excluding Japan) - Doc # AP654107N Asia/Pacific Consumer Markets
Asia/Pacific (Excluding Japan) Media Center PC 2006–2010 Forecast: A Real Opportunity in a Niche Market? - Doc #AP654114N Asia/Pacific Consumer Markets
Services
Application Outsourcing: End-User Survey Results 2006 - Doc #AP221703N Asia/Pacific IT Outsourcing and Utility Services
Discrete Outsourcing for IT Infrastructure: End User Survey Results 2006 - Doc #AP221707N Asia/Pacific IT Outsourcing and Utility Services
Large Enterprise Managed Services Usage and Preference -- Moving on from Cost Savings? - Doc #AP1441S8N Asia/Pacific Managed Services
Storage and Data Management Services Profile: IBM - Doc #AP223203N Asia/Pacific Storage and Data Management Services
Asia/Pacific (Excluding Japan) Broadband Internet Access Services 2006-2010 Forecast and Analysis - Doc #AP201404N Asia/Pacific IP Services
Small and Medium Sized Enterprises Managed Services Usage and Preferences - A Glass Full of Opportunities - Doc #AP144104N Asia/Pacific Managed Services, Asia/Pacific IT Outsourcing and Utility Services
Outsourcing to the EDS Agility Alliance - Doc #AP221704N Asia/Pacific IT Outsourcing and Utility Services
Asia/Pacific (Excluding Japan) Support Services: Three Challenges Facing Vendors Today - Doc #AP221108N Asia/Pacific Services Opportunities
Software
Adoption Maturity on Application Development and Deployment Software in Key Asia/Pacific Countries, 2006 - Doc #AP3221S5N Asia/Pacific Application Tools Software
Asia/Pacific (Excluding Japan) Customer Relationship Management Applications 2006-2010 Forecast and Analysis - Doc #AP321207N Asia/Pacific Enterprise Applications
Asia/Pacific (Excluding Japan) Investment Plans on Application Development and Deployment Software in Emerging Countries, 2006 - Doc #AP3221S4N Asia/Pacific Application Tools
BEA Systems Aims for Easy Service Oriented Architecture Take-Up - Doc #AP322112N Asia/Pacific Application Tools
Infor Reinforces With Crossbreeding - Doc #AP39402N Asia/Pacific Semiannual Enterprise Applications Tracker, Asia/Pacific Enterprise Applications
Asia/Pacific (Excluding Japan) Online Gaming Service Providers Databook, 2006 - Doc #AP3221S8N Asia/Pacific Online Gaming
Storage
The Market Impact and Outlook for Wide Area File Services - Doc #AP261110N Asia/Pacific Disk Storage Systems
Storage Profile 2006: EMC - Doc #AP261108N Asia/Pacific Disk Storage Systems
Telecom/Networking

Carrier Strategies in Mobile Data Services in Asia/Pacific (Excluding Japan) - Doc #AP201305N Asia/Pacific Wireless Markets and Technologies

IMS: Asian Carriers' Perceptions, Understanding, Adoption Plans, and Investments - Doc #AP204102N Asia/Pacific Carrier Network Equipment
Fixed Mobile Convergence Decoded for the Enterprises - Doc #AP206111N Asia/Pacific Enterprise Mobility
Managing the Prosumers: What Are IT Managers to Do? - Doc #AP206112N Asia/Pacific Enterprise Mobility
The Road to 4G: Building a Wireless Broadband Future in Asia/Pacific - Doc #AP204107N Asia/Pacific Carrier Network Equipment
Financial Insights
Invisible War: Asian Banks Versus Internal Fraud - Doc #FIN202995 Asia/Pacific Banking Advisory Service, Asia/Pacific Risk Management Advisory Service
Cross-Border Remittance in Asia/Pacific - Doc #FIN202907 Asia/Pacific Banking Advisory Service
HSBC Emerges as the World's Biggest Bank - Doc #FIN203125 Asia/Pacific Banking Advisory Service
Transaction Cost Analysis: Ensuring Excellence in Execution in Asia - Doc #FIN203068 Asia/Pacific Capital Markets Advisory Service
CRM Resurgence in Asia: Which Banks Lead the Charge? - Doc #FIN202885 Asia/Pacific IT Benchmarking Advisory Service
Australia/New Zealand
Australia Paid Music Service Provider 2006-2010 Forecast and Analysis: Grooves Move Beyond Pods - Doc #AU654108N Australia Digital Home Market Opportunities
Australia IS Outsourcing and NDOS Services 2006-2010 Forecast and Analysis - Doc #AU221206N Australia Outsourcing and Utility Services
A Refresher Course for Selling into a PC Market With No Refresh Cycle - Doc #AU103101N Australia Buying Behavior and Trends: Computer Systems
Australian Healthcare IT Market, 2006 - Doc #AU386106N Australia Vertical Markets
Australian Government IT Market, 2006 - Doc #AU386102N Australia Vertical Markets
Australian Business Services IT Market, 2006 - Doc #AU386107N Australia Vertical Markets
TEyewitness: The Extended Enterprise - Doc #AU616208N Australia ITEyewitness
Understanding How Australia Medium-Sized Businesses Buy Technology: Where Is the Opportunity for Vendors? - Doc #AU381109N Australia Small and Medium Business Market
Australia Small and Medium-Sized Business Enterprise Applications 2006--2010 Forecast and Analysis - Doc #AU381104N Australia Small and Medium Business Markets
HR BPO Vendor Analysis- The Evolving Landscape - Doc #AU223104N Australia Business Process Outsourcing
New Zealand Vertical Market 2006–2010 Forecast and 2005 Review - Doc #NZ384106N New Zealand: Vertical Market Review and Forecast 2005-2010
China
China Digital Entertainment Content 2006-2010 Forecast - Doc #CN656107N China Consumer Devices and Services
China Telecom Services 2006-2010 Forecast and Analysis - Doc #CN206101N China Telecom Market Opportunities, China IT Market
China IT Services 2006-2010 Forecast and Analysis - Doc #CN221101N China Services Market, China IT Market
China Storage Software Market 2006-2010 Forecast and Analysis - Doc #CN321107N China System Infrastructure Software, China Software Market
China IT Service Management 2006-2010 Forecast and Analysis - Doc #CN321106N China System Infrastructure Software, China Software Market
China Digital TV Market: Opportunities and Challenges - Doc #CN656105N China Consumer Devices and Services
Oracle CIO Summit 2006 - Doc #CN221100N China Services Market
Japan
Japan IT Outsourcing User Survey 2006: Customer Perception and Needs - Doc #JP222210N Japan Outsourcing
Japan Infrastructure Management Software 2006-2010 Forecast and 2005 Vendor Shares - Doc #JP322114N Japan Software Infrastructure and Tools
Japan CIO Survey 2006: IT Services Spending Trends - Doc #JP222110N Japan IT Services Opportunities and Contenders
Japan IT Security Hardware, Software and Services: 2006-2010 Forecast and 2005 Analysis - Doc #JP206110N Japan Security Products and Services
Impact of New Accounting Standards on Japan's IT Services Market - Doc #JP222115N Japan IT Services Opportunities and Contenders
Japan Storage Software 2006-2010 Forecast and 2005 Vendor Shares - Doc #JP326126N Japan Storage Solutions
Japan Storage Services 2006–2010 Forecast and 2005 Vendor Shares - Doc #JP326125N Japan Storage Solutions
Oracle's JD Edwards EnterpriseOne 8.12 Strategy Targeting the SME Market - Doc #JP384115N Japan IT Solutions, Japan Software Infrastructure and Tools
Japan Network Attached Storage 2006-2010 Forecast and Second Half 2005 Vendor Shares - Doc #JP326106N Japan Storage Systems 2. Japan Storage Solutions
Japan Security Software 2006-2010 Forecast and 2005 Vendor Shares - Doc #JP322111N Japan Software Infrastructure and Tools
Japan ERM Solution 2006-2010 Forecast - Doc #JP384104N Japan IT Solutions
Non-Japanese PC Vendor Wins 2nd Place: Market Shares Adjust as Industry Structure Reorganizes - Doc #JP102118N Japan Personal Computing
Japan Carriers Internet Data Center 2006-2010 Forecast and 2005 Analysis - Doc #JP203110N Japan Carrier Managed Services
Japan Volume Server 2005 Vendor Analysis - Doc #JP242116N Japan Servers
Japan PC 2006-2010 Forecast and 1Q06 Vendor Shares: Product Analysis - Doc #JP102112N Japan Personal Computing
Korea
Korea Overall Software 2006-2010 Forecast and Analysis : 2005 Year-End review - Doc #KR32080618 Korea Software
Korea Business Intelligence Software 2006-2010 Forecast and Analysis: 2005 Year-End Review - Doc #KR32080619 Korea Software
Korea CRM Applications Software 2006-2010 Forecast and Analysis: 2005 Year-End Review - Doc #KR32080620 Korea Software
Korea SCM Applications Software 2006-2010 Forecast and Analysis: 2005 Year-End Review - Doc #KR32080621 Korea Software
Malaysia
Malaysia IT Market Sentiment, 3Q06 - Doc #MY384104N Malaysia IT Market Monitor
Philippines
Philippine SME IT Buying Behavior, 2006 - Doc #PH383105N Philippine ICT Market
Asia/Pacific Research – Coming in August 2006
Software
CRM Applications: Investment and Adoption Plans in India, Australia, PRC and Korea, Survey 2006 Asia/Pacific Enterprise Applications
ERM Applications: Investment and Adoption Plans in Malaysia, Thailand, and Vietnam, 2006 Asia/Pacific Enterprise Applications
Telecom/Networking
Asia/Pacific (Excluding Japan) Enterprise Mobility Vendor Competitive Analysis: Who's Ahead of the Curve? Asia/Pacific Enterprise Mobility
Asia/Pacific (Excluding Japan) Enterprise Communications Survey 2005 - Vertical Splits Asia/Pacific Telecommunications
Asia/Pacific Emerging Asia Telecommunications Capex Forecast & Analysis, 2006-2011 Asia/Pacific Emerging Asia Telecommunications Capex Forecast & Analysis, 2006-2010
IT Spending
Asia Pacific IT Spending and User Segmentation, 2006-2010 Forecast, August 2006 Asia/Pacific IT Spending and User Segmentation
Australia/New Zealand
Understanding How Small Australian Businesses Buy Technology: The Great Challenge for Vendors Australia Small and Medium Business Markets
Australia Business Mobile Vertical 2006-2010 Forecast and Analysis: Can You Read My Mind? Australia Mobile and Wireless Solutions
Australia Digital Terrestrial, Cable, Satellite and IPTV 2006-2010 Forecast: Videos from the Pipe Australia Digital Home Market Opportunities
Australia IT Spending 2006–2010 Forecast Update: 1Q06 Review Australia ICT Market Planning
The Hospital of the Future: IP Overall, All Over IP: St Olav Hospital, a Case Study in the Healthcare Industry Australia Next Generation Networks, Australia Mobile and Wireless Solutions, Australia IP Network Services, Australia Vertical Markets
Australia Mobile Marketing and Advertising: In My Pocket Australia Mobile and Wireless Solutions
Australia SMB Competitive Landscape, 2006: David or Goliath? Who Will Win the SMB Race? Australia Small and Medium Business Markets
Australia IT Services Survey 2006: A Demand-Side View Australia IT Services Opportunities
Australia Digital Video Recorder (DVR) and Media Center PC 2006-2010 Forecast and Analysis: From Niche to Masses Australia Digital Home Market Opportunities
China
China Tape Drive and Tape Automation 2006-2010 Forecast and Analysis China Tape Drive and Tape Automation 2006-2010 Forecast and Analysis
China Packaged Software 2006-2010 Forecast and Analysis China Software Market, China IT Market
China Hardware Maintenance 2006-2010 Forecast and Analysis China Services Market
China Telecom Service Provider Study China Telecom Market Opportunities
China Vertical RFID Solution 2006-2010 Forecast and Analysis China Vertical Solutions Market
Korea
Korea PC 2006-2010 Forecast Update: 2Q 2006 Review Korea Personal Computing
Korea Server 2006 – 2010 Forecast and Analysis: 2Q 2006 Review Korea Enterprise Systems
Malaysia
Korea PC 2006-2010 Forecast Update: 2Q 2006 Review Korea Personal Computing
IDC Specialist Connection

Avneesh Saxena, Vice President, Asia/Pacific Systems, Storage, and Software Research

Infrastructure Simplification Through Virtualization

Organizations need to cope with increasingly complex IT infrastructure and systems when expanding the scale and scope of their business. For years, enterprises have tried proprietary approaches to decouple existing systems and, in turn, have been caught in a vicious "stop-gap" cycle of sporadically reskilling, reimplementing, upholding costly annual maintenance fees for enterprise applications, and relearning users' needs across organizations.

Today, virtualization and service oriented architecture (SOA) are IT industry buzzwords. But what does virtualization mean to CIOs, and what can enterprises expect to achieve through virtualization? To address these and other issues, the following questions were recently posed to Avneesh Saxena, Vice President, Asia/Pacific Systems, Storage, and Software Research.
Q
What is server virtualization and what does it encompass?
A

Currently, virtualization enables users to efficiently leverage the compute capacity available within an organization across similar platforms. In addition to gains in utilization levels, virtualization has far-reaching impact on the cost of IT, turnaround time, and management of infrastructure. Virtualization also enables consolidation, so that end users are able to effectively harness the capacity present within their existing infrastructure.

Moving forward, we expect vendors to couple several management and automation tools with virtualization software in order to provide end users the capability to further reduce manual time and to create a more dynamic IT environment. This would help run the infrastructure in a more seamless and intelligent manner, and unhinge IT assets from their physical location to make them centrally available to users across multiple departments. Eventually, we foresee that common virtualization tools will be used across different platforms.

 
Q
What factors have led to the importance of virtualization in an enterprise?
A

Key virtualization drivers are:

  • Value. Organizations want to simplify processes in the data center, aiming to do more with less.

  • Consolidation. The higher the fragmentation, the higher the points of failure. Furthermore, different operating systems demand different expertise. Consolidation helps to shift to fewer platforms and reduce disparities, leading to cost savings in manpower, and lower ongoing hardware and software costs.

  • Simplification. New business services and applications have a tendency to add new servers. Servers with more powerful processors and dense form factors (blades) will render the consumption of electricity and air conditioning uneconomical; moreover, the real estate required to house multiple servers is an increasingly valuable asset. Virtualization helps to pare down the complexity in the datacenter.
  •  
    Q
    What are the key benefits of virtualization to an enterprise?
    A

    Two primary benefits of virtualization to an organization are:

  • Helps build an efficient and cost effective datacenter
  • Provides the ability to do more with the existing infrastructure

    As the business environment continues to change, organizations will feel the necessity to have a more agile and adaptable infrastructure to help them move ahead of their competitors. IDC believes that virtualization is a key building block for future datacenters, and the foundation on which an organization can develop a more dynamic IT environment.
  •  
    Q
    What initiatives does an organization have to take to ensure a virtualized environment?
    A

    At the outset, end users must understand the capabilities and limitations of the currently available virtualization tools in the market, along with industry direction; this is important in order to isolate hype from reality. Thereafter, the organization should conduct an audit of its IT environment to better understand its virtualization possibilities, and the potential benefits, before implementation.

    At the selection stage, end users can choose a vendor that best suits the organization's needs. Virtualization is possible across the hardware and software layers of an organization's IT infrastructure. It can be deployed at the access layer, application layer, platform layer, and the storage systems layer. Depending on the level and need for virtualization, end users can partner with vendors that cater to these respective spaces.

    IDC believes that it is worthwhile for organizations to examine ways to reduce silos and share IT resources across business units. Companies will face internal resistance at this stage, because change implies a significant departure from the traditional approach: every business division having its own IT infrastructure. However, identifying opportunities for IT consolidation helps to lay the foundation for a service oriented architecture (SOA), which demands higher standards across the organization.

     
    Q
    What are the key challenges of virtualization?
    A

    Key challenges of virtualization include:

  • Institutional resistance. Resistance on the part of the company and its users to let go of existing independent structures and adopt a centralized infrastructure.

  • Cost to the company. Invariably, implementing new technology incurs cost.

  • Software ability. There is a gap between vendors' vision of virtualization software and its market availability. Thus, users who are aware of this bridge are in a cautious, "wait and watch" mode.

  • Lack of awareness. End users are not completely aware of the kind of technology available, its capabilities, and the difference it can make to their infrastructure. Apprehension on the part of CIOs and IT managers is a primary reason for slow adoption and deployment of virtualization: they will not hamper existing infrastructure unless they are certain of the result.

  • Lack of in-house expertise. Companies lack the confidence to implement and manage virtualization software on their own; a subsequent lack of vendor support also can be a hindrance.
  •  
    Q
    Ideally, what can an organization expect post-virtualization?
    A

    Organizations are increasingly keen to know the benefits of new IT investments. CIOs and IT managers also have to justify ROI. In the case of virtualization, the benefits range from cost benefits to increased efficiency. IDC recommends that organizations understand and measure the promises offered by vendors before implementation, and that end users keep their internal goals in mind, such as:

  • Productivity gains
  • Better levels of efficiency with respect to the utilization of servers
  • Cost benefits
  •  
    Q
    What is the focal point of IDC's Asia/Pacific InfraVision Conference 2006?
    A

    A solid infrastructure is vital to an organization's IT capabilities. Thus, at IDC's Asia/Pacific InfraVision Conference 2006, we will discuss two solutions that we believe will help to change the face of the datacenter: virtualization and SOA.

    IDC believes that there is a strong link between virtualization - an important step to facilitate SOA, which requires more simplification and less rigidity within an organization's infrastructure, and one of the fundamental technologies that can have an extensive impact on the procurement trends of organizations, and SOA - the end-goal for most organizations today.

    This conference aims to educate end users about available virtualization technologies, and foster understanding of the evolving virtualization market.

     
    Q
    What can attendees expect from the IDC's Asia/Pacific InfraVision Conference 2006?
    A

    The underlying theme of the conference is "harnessing the power of SOA and virtualization." The conference will address topics such as:

  • Building a SOA, knowing where to start - the business or IT side.
  • Types of virtualization, what can be virtualized, and what needs to be virtualized.
  • Building an architecture that helps align IT decisions with business objectives.
  • Consolidation and integration of IT infrastructure with virtualization to benefit the bottom line.
  •  
      IDC's Asia/Pacific InfraVision Conference 2006 will run in 12 cities across the region in September, October, and November 2006. For more information, visit http://www.idc.com.sg/infravision2006/
     

    ABOUT THIS AUTHOR

    Avneesh Saxena is based in Hong Kong and heads the Asia/Pacific Systems, Storage, and Software Research group. In this role, he drives research and analysis that focuses on tracking emerging technology trends, vendor strategies, market size, distribution channels, and end-user segmentation in the Asia/Pacific Personal Systems, Servers, Storage, and Software markets. Avneesh has successfully led many research projects and mentored many people in his team in the past 13 years with IDC. Prior to joining IDC Asia/Pacific, Avneesh was with IDC India where he was responsible for tracking and analyzing hardware & software supply-side research for the Indian market.

    ABOUT THIS ARTICLE

    This article was produced by IDC Go-to-Market Services. The opinion, analysis, and research results presented herein are drawn from more detailed research and analysis independently conducted and published by IDC, unless specific vendor sponsorship is noted. IDC Go-to-Market Services makes IDC content available in a wide range of formats for distribution by various companies. A license to distribute IDC content does not imply endorsement of or opinion about the licensee.

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