CIO SUMMIT 2014: IDC chief analyst sees 'hyper disruption' ahead for cloud, business

"You aint seen nothing yet," was the message from IDC VP and chief analyst Frank Gens at the CIO Summit 2014 in Auckland this morning.

The IDC man's pitch is that we're moving to the third platform. (The first being mainframe computers, the second PCs and servers).

The third platform includes the cloud, mobile and social media.

This much we all know. Where's it heading?

At the sharp end of things, Mr Gens says cloud, mobile and social accounted for 25% of new IT spending 2013.

In seven years' time, he says it will account for 100% of all new IT budget growth.

The cloud war has heated up this year, with new data centres being built at a furious pace, and savage price cutting.

Expect more of the same. Mr Gens says Amazon, Google, Microsoft, HP and other cloud players will double their operations in the key Platform-as-a-Service area over the next 24 months.

He sees the cloud market consolidating to six or eight big players in three or four years time. "It's all about scale," he says. "If you don’t scale up, when the market consolidates you’re out."

Mr Gens sees two camps in the cloud war.

One is the single-vendor cloud stack players, who include Google, Amazon, Salesforce and Microsoft, who have all created their own, self-contained eco-systems

The other is the open vendoers, or who share technology. They includeOpenStack, HP, IBM and SAP.

He characterises them as similar to the Linux camp against Microsoft, or the Android pack who successfully took on Apple's smartphone monopoly. No one could chase down Amazon Web Services' big lead individually, but collectively they could have a winning hand.

Who'll win? Mr Gens says watch the developers. The camp who attracts the most will be the one that creates the killer apps, and where money will ultimately gravitate.

Like all-comers, Mr Gens also talks up the internet of things as the definition of "mobile computing" is radically extended, but is broader than some in his sweep. He sees coming examples of smart devices including an internet-connected contact lens that can track a diabetic's blood sugar levels, and everything from smart tennis rackets to smart tooth brushes. The edge is "hyper-extending," as he puts it.

Smartphones and tablets are only chapter one in the "hyper extension" of computing, he says, meaning Apple and Google's dominance in those areas means little. "Microsoft – congratulations you’ve got another shot," he says.

The IDC analyst sees the "Amazon-ing" of every industry on the planet over the next four years.

"Think what Amazon did to retail. They took the third platform and said 'How can we use this to redefine how people shop,," including redefining the supply chain and lowering costs. 

He sees players in other industries will create cloud platforms for crunching big data about their customers, and using it to create new services. 

"In any industry, about a third of the top players will experience a serious case of heartburn, perhaps fatal  because new competitors take technologies and expand market reach with new products, dramatically expand supply chain partnerships, and reduce cost structure," he says.

Long term, he says we're moving to an era of "two-way digitisation. We've been taking real-world information and turning it into ones and zeros.

"Over next several years swing of that door in the other direction," Mr Gens says.

He references 3D printers — the technology of the moment — but sees it moving beyond plastic widgets to synthetic biology, or creating replacement organs. He also sees computers that can programme themselves and talk to you talking over basic service jobs, and technologies like self-driving cars entering the mainstream. It all seems like radical stuff, and at times abstract, but Mr Gens is talking tight timeframes, and advises people to be on the lookout for what will impact their industry.

ckeall@nbr.co.nz