hype cycle for ict in india, 2012 - ace...

G00233973

Hype Cycle for ICT in India, 2012Published: 31 July 2012

Analyst(s): Sanish KB, Vishal Tripathi

This report analyzes evolving trends and the maturity of various segments ininformation and communication technology in India, as well as the degree ofcurrent and projected market adoption of various technologies by theenterprises based in India.

Table of Contents

Analysis..................................................................................................................................................3

What You Need to Know..................................................................................................................3

The Hype Cycle................................................................................................................................ 3

Interpreting the Hype Cycle Graphics............................................................................................... 4

• The Priority Matrix..........................................................................................................................7

Off The Hype Cycle.......................................................................................................................... 8

On the Rise...................................................................................................................................... 9

Extreme Low-Energy Servers......................................................................................................9

Intelligent Transportation System.............................................................................................. 12

Navigation Solutions................................................................................................................. 14

COBIT...................................................................................................................................... 15

Entity Resolution and Analysis.................................................................................................. 17

Infrastructure as a Service........................................................................................................ 19

Hosted Virtual Desktops........................................................................................................... 21

Server Power Capping..............................................................................................................24

BPaaS...................................................................................................................................... 25

At the Peak.....................................................................................................................................29

Big Data................................................................................................................................... 29

ITIL........................................................................................................................................... 32

Data Center Bridging in India.................................................................................................... 34

E-Commerce in India................................................................................................................ 36

Finance and Accounting BPO...................................................................................................38

Managed Print Services............................................................................................................39

Fabric-Based Infrastructure...................................................................................................... 43

Media Tablets...........................................................................................................................45

SaaS-Related Professional Services......................................................................................... 47

VM Energy Management Tools................................................................................................. 50

Mobile Over-the-Air Payment....................................................................................................51

Solar Energy Technology.......................................................................................................... 54

KPO......................................................................................................................................... 56

Sliding Into the Trough....................................................................................................................58

Cloud Computing..................................................................................................................... 58

Mobile Application Stores......................................................................................................... 60

Business Service Management Tools........................................................................................62

Mobile Advertising.................................................................................................................... 63

Infrastructure Outsourcing Services, India.................................................................................66

CFD Analysis............................................................................................................................ 68

Advanced Server Energy Monitoring Tools................................................................................70

Unified Communications...........................................................................................................71

Business Process Management Suites..................................................................................... 72

Open-Source Development Tools in India.................................................................................74

Video Telepresence.................................................................................................................. 76

Software as a Service............................................................................................................... 79

CRM in India.............................................................................................................................81

Data Deduplication................................................................................................................... 83

SCM.........................................................................................................................................86

Business Intelligence Platforms.................................................................................................87

Climbing the Slope......................................................................................................................... 89

Service-Oriented Architecture, India..........................................................................................89

Power Over Ethernet Plus (IEEE 802.3at)..................................................................................91

Virtualization............................................................................................................................. 92

WAN Optimization Controllers...................................................................................................94

IP Telephony Equipment...........................................................................................................96

Appendixes.................................................................................................................................... 97

Hype Cycle Phases, Benefit Ratings and Maturity Levels.......................................................... 99

Recommended Reading.....................................................................................................................101

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List of Tables

Table 1. Hype Cycle Phases.................................................................................................................99

Table 2. Benefit Ratings......................................................................................................................100

Table 3. Maturity Levels......................................................................................................................100

List of Figures

Figure 1. Hype Cycle for ICT in India, 2012.............................................................................................6

Figure 2. Priority Matrix for ICT in India, 2012......................................................................................... 8

Figure 3. Hype Cycle for ICT in India, 2011...........................................................................................98

Analysis

What You Need to Know

The Indian economy has been growing rapidly during the past decade, driven by wide-rangingpolicy reforms, increased foreign investments and improvements in infrastructure. India's grossdomestic product (GDP) at current prices grew 6.7% in 2011 to reach $1,779 billion. This rapideconomic growth, coupled with the ever-increasing demand for and from information andcommunication technology (ICT) to sustain growth, presents India with a key challenge. Thecontinuing global economic uncertainty is influencing the Indian vendor landscape and marketgrowth, but the Indian ICT market is still in a relatively strong growth phase when compared with theglobal market.

The objective of this report is to take into account the current state of technologies in India, as wellas their maturity and traction, and place them on the Gartner Hype Cycle accordingly. Technologyvendors, service providers, investors and other IT decision makers will be able to determine thematurity of each technology and the time frame for it to become mainstream. We have included theglobal and Indian vendors within the Sample Vendors lists wherever possible.

Some technologies represented here are also covered within global Hype Cycles and, hence,contain the suffix "in India" to indicate that they represent Indian conditions; all other technologiesrepresented here are analyzed and positioned only in terms of the Indian market.

The Hype Cycle

India is emerging in terms of IT communications infrastructure consumption and is supported by astrong ecosystem of IT services providers (both India-based and global) including software andhardware vendors and system integrators.

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Indian enterprises are continuing to invest in information technology to improve productivity anddrive their growth. The primary drivers of growth can be attributed to strong domestic demand forgoods and services, led by a growing middle class with high disposable income. This is in additionto growth opportunities that Indian enterprises are seeking in new markets globally. To cater to thisdomestic demand and to align with global industries' best practices, Indian enterprises are slowlybut steadily upgrading their software, hardware, communications and networking infrastructure.

Indian enterprises are generally more price-sensitive compared with enterprises in mature marketsbut have recently shown a tendency to invest in technology that offers a significant upside in termsof agility or productivity gains. The dynamic shift in business conditions means that some of thisspend is unbudgeted but is considered vital to drive business benefits.

The technology lag is slowly diminishing (for example, in server virtualization), and manyorganizations in India are open to exploring new technology to attain that extra bit of businessdifferentiation in the growth phase. The market is also witnessing the entry of local vendors inemerging, as well as mature, technology segments, covering areas such as cloud computing,application development, business intelligence, business process management suites, data centers,and green and sustainability technology tools, and offering the same through software as a service(SaaS) and the cloud.

Apart from large enterprises, India also has a large potential market of small and midsize businesses(SMBs) — which is playing a crucial role in changing the consumption patterns of the technology.SMBs are now adopting more technology than before, but they still lack a strategic focus and willremain price-conscious.

Interpreting the Hype Cycle Graphics

This Hype Cycle report identifies 43 key technologies (compared with 44 in the 2011 Indian ICTHype Cycle) and describes the ways in which they will impact business performance during the next10 years. In this document, Gartner presents its views on the progress of some of the mostinteresting and significant technologies related to ICT in India.

Technologies that contribute to the performance of an organization, as well as to the widereconomies in which they operate, are plenty. In this Hype Cycle (see Figure 1), we profile 43technologies that we think are relevant from the Indian market's point of view. These technologiesare categorized as emerging, mature and in-between based on several factors; all are importantbecause they represent significant market and investment opportunities.

As such, clients are advised to study them carefully and to seek more detailed information ontechnologies of interest. Technologies near the peak are not necessarily more important or maturethan other technologies; they are simply enjoying a greater degree of hype (and press interest) thanother technologies. The list of technologies included is not exhaustive — technologies have beenselected on the basis of industry interest and analyst preference. Their positions on the Hype Cycleare averages — in recognition that variations exist. Some technologies should be viewed asunderlying enabling technologies that facilitate a wide range of end applications. The adoption rateof technologies varies across these applications.


This 2012 report is a revision of the report published in 2011. This year's report includes additions,deletions and technology name changes.

New technologies include the following:

■ E-commerce in India

■ Hosted virtual desktops

■ Extreme low-energy servers

■ Intelligent transportation system

■ SaaS-related professional services

■ Business process as a service (BPaaS)

These technologies have been intentionally repositioned:

■ COBIT — COBIT 5.1, released in 2011, marked a shift from a control focus to an effective andmore positive governance focus, while keeping the significance of risks unchanged. This shiftalso provides new opportunities for enhancing the value of infrastructure and operations (I&O)and IT services from governance and risk management perspectives. Hence, COBIT has beenmoved backward.

■ ITIL — The new ITIL 2011 contains a completely redone service strategy section with significantnew processes, such as business relationship management and strategy management. Theservice transition section also has undergone big changes in terms of scoping of processes andnew processes in transition planning and integration between change and release management.The new features offer big, new opportunities for I&O teams to improve the business alignmentof IT and manage changes more effectively. Hence. ITIL has been moved backward.


Figure 1. Hype Cycle for ICT in India, 2012

Technology Trigger

Peak ofInflated

Expectations

Trough of Disillusionment Slope of Enlightenment

Plateau of Productivity

time

expectations

Plateau will be reached in:

less than 2 years 2 to 5 years 5 to 10 years more than 10 yearsobsoletebefore plateau

As of July 2012

Extreme Low-Energy ServersIntelligent Transportation System

Navigation Solutions

COBITEntity Resolution and Analysis

Infrastructure as a Service

Hosted Virtual Desktops

Server Power Capping

BPaaS

Finance and Accounting BPO

Big DataITIL

Data Center Bridging in IndiaE-Commerce in India

Managed Print ServicesFabric-Based Infrastructure

SaaS-Related Professional ServicesVM Energy Management Tools

Mobile Over-the-Air PaymentSolar Energy Technology

KPO

Cloud ComputingMobile Application Stores

Business Service Management ToolsMobile Advertising

Infrastructure Outsourcing Services, India

CFD AnalysisAdvanced Server Energy Monitoring Tools

Unified CommunicationsBusiness Process

Management Suites

Open-Source DevelopmentTools in India

Video Telepresence

Software as a Service

CRM in India

Data Deduplication

Media Tablets

SCM

Business Intelligence Platforms

Service-Oriented Architecture, India

Power Over Ethernet Plus (IEEE 802.3at)

Virtualization

WAN Optimization Controllers

IP Telephony Equipment

Source: Gartner (July 2012)


• The Priority Matrix

The Priority Matrix (see Figure 2) maps the benefit rating for each technology against the length oftime before Gartner expects it to reach the beginning of mainstream adoption. This alternativeperspective can help users determine how to prioritize the technology investments. In general,companies should begin in the upper-left quadrant of the chart, where the technologies will havethe most dramatic effects on business processes, revenue or cost-cutting efforts, and are availablenow or will be available in the near future.

Among the 43 technologies listed here, 24 will mature within the next five years, and 20 of them willhave a transformational or high impact on businesses. Some technologies, such as cloudcomputing, data deduplication and virtualization, enable new ways of doing business acrossindustries, which will result in a major shift in industry dynamics and will also lead to the creation ofa new and improved — and sustainable — ecosystem. Some technologies will become mainstreamin less than two years. For example, new investments in immersive group systems are increasinglybeing replaced by investments in personal and executive systems. This is decreasing the overallscale of the addressable market for immersive systems and speeding up the rate at which thesetypes of solution move off the Hype Cycle.

Technologies such as IP telephony equipment, WAN optimization controllers and virtualization haveadvanced toward the Plateau of Productivity. However, among these technologies, IP telephonyequipment and WAN optimization controllers will be slow in their path to the Plateau of Productivity.Technologies such as unified communications, mobile advertising, business service managementtools and CFD analysis are slipping toward the Trough of Disillusionment. Those on the TechnologyTrigger (extreme low-energy servers, intelligent transportation system, navigation solutions, and soon) may take longer to achieve market acceptance; these technologies have less than 5% marketpenetration and long periods to mainstream adoption — generally a minimum of two years and aslong as five to 10 years. Business intelligence platforms, COBIT, and entity resolution and analysisare expected to take more than 10 years to reach the plateau. Even though business intelligenceplatforms are positioned on the Slope of Enlightenment, they are expected to take more than 10years to reach the plateau, because the market and adoption haven't grown. SaaS-relatedprofessional services will likely go through the Hype Cycle much faster than most othertechnologies. SaaS is moving quickly on both sides (buyers and sellers). On the buyers' side,interest in the benefits of SaaS is so great that many organizations have made at least a smallpurchase. On the sellers' side, a majority of software vendors are either offering or investing inoffering some version of SaaS.


Figure 2. Priority Matrix for ICT in India, 2012

benefit years to mainstream adoption

less than 2 years 2 to 5 years 5 to 10 years more than 10 years

transformational Virtualization Cloud Computing

Data Deduplication

high Advanced Server Energy Monitoring Tools

Big Data

Mobile Application Stores

Mobile Over-the-Air Payment

SCM


Solar Energy Technology

Unified Communications

VM Energy Management Tools

Business Service Management Tools

Extreme Low-Energy Servers


ITIL

KPO


Entity Resolution and Analysis

moderate Video Telepresence CFD Analysis

CRM in India



Mobile Advertising


SaaS-Related Professional Services



BPaaS

Business Process Management Suites

E-Commerce in India

Fabric-Based Infrastructure



Intelligent Transportation System

Managed Print Services

Media Tablets

Open-Source Development Tools in India


COBIT

low Power Over Ethernet Plus (IEEE 802.3at)

As of July 2012


Off The Hype Cycle

Following technologies are no longer on this Hype Cycle:

■ Product life cycle management (PLM)-based team collaboration — This technology was retiredbecause it has matured. Interest levels are low because of the limited number of users andbecause vendors are offering products and services having low differentiation.


■ Mini-notebooks — This technology was retired because its market matured and many vendors,such as Dell, Lenovo and HP, have stopped selling them in India.

■ Thin provisioning in India — This technology was retired because it has a fairly mature marketwith good traction within the market. While an important storage technology, it does not have asignificant impact on Indian IT market spending.

■ ERP — This technology was retired because ERP has reached the Plateau of Productivity.

■ Blade servers — This technology was retired because the market adoption of blade serversremains static with no significant change. Hence, there is not much value for the reader.

■ WAN optimization services — This technology was taken out, because WAN optimizationcontrollers (WOCs) are a technology on our Hype Cycle — and the trends of WOC as a serviceare evaluated in our analysis of this technology. WAN optimization as a whole is still developingas a network segment in India — with the mainstream user segments still not clear about itsvalue.

■ Cloud-driven business and IT services — Our description of this technology was created duringthe embryonic stages of cloud services. The definition and material captured in the analysisreflected services across several layers of the stack, including infrastructure, applications andbusiness process. As we follow this market, we see each of these areas growing and takingspecific trajectories, which now need to be distinctly depicted. Hence, we have retired thedescription of cloud-driven business and IT services, and we have created more depth for eachdistinct area, such as SaaS-related professional services and BPaaS, which now appear on theHype Cycle.

Technologies renamed in this Hype Cycle include the following:

■ The technology previously termed "big data and extreme information processing andmanagement" has been renamed as "big data."

■ "x86 server virtualization" has been renamed as "virtualization." Our description of virtualizationwas the "parent" of the description of x86 virtualization, and as the markets equalized, theseparate analysis was merged back and rationalized.

■ "IT outsourcing infrastructure services" has been renamed as "infrastructure outsourcingservices, India" to align with the global name.

On the Rise

Extreme Low-Energy Servers

Analysis By: Naveen Mishra; Carl Claunch

Definition: Extreme low-energy (ELE) servers are systems constructed around processor types thatwere originally designed for very low-power environments, typically in devices like smartphones, orin an object with a processor embedded inside. Low-energy server systems have energy


requirements that run from about 5 watts per core at the high end, down to fractions of a watt percore at the low end.

Position and Adoption Speed Justification: Prospective server vendors are ratcheting up their PRefforts; some are actively engaging with potential customers, or are supporting early customers inglobal markets. Many in the media are intrigued by dramatic speculation that this trend mightdisrupt Intel's and AMD's dominance of the server market. This scenario speaks of a major shift inthe market toward new low-energy server designs, and postulates the disruption of the industrypower balance, possibly replacing the big providers of chips and servers with a new slate ofsuppliers.

As speculative and extreme as this prospect may be, clients with major investments in x86 vendorsand products want to know to what extent this scenario may come to pass, because they will needto understand whether their existing server software will have to be converted to run on the newcategory of servers, which the scenario posits are predominately non-x86 machines.

The processor types used in this emerging category of low-energy servers currently include ARMfrom various semiconductor firms, Intel's Atom and Tilera's TILE-Gx. However, many otherprocessor architectures (such as million instructions per second [MIPS], SPARC, SuperH, 68k andPowerPC) could be adopted to build ELE servers. These processors are usually built as system-on-chip (SoC), which integrates circuitry on one chip alongside processors implemented by additional,separate support chips in traditional PC and server products. SoC leverages its included supportlogic across several cores on the silicon die to further drive down power use.

These systems are quite different from systems using low-power models of the processor typestraditionally used in servers and PCs for example, as with the Intel Xeon family, where the lowestpower versions scale down to about 10 watts per core. This figure does not include the powerrequired for the separate support chips needed on traditional servers, the wattage of a processorchip shouldn't be directly compared with the net power per core of low-energy systems.

Significant announcements this year include HP's Project Moonshot, Calxeda's EnergyCoreprocessor and the purchase of SeaMicro by AMD, reflecting the growing activity around thisemerging technology.

Indian organizations want to know whether they should retire and replace existing servers, andwhether they will need to change strategies for their infrastructures. In reality, these lower-energyserver alternatives are suitable for a specific and narrow set of cases (essentially, workloads thathave light processor requirements in relation to their memory and input/output needs and, critically,can nearly linearly scale in parallel across many more processors than are used running ontraditional x86 servers). The market impact of the alternative servers will be slow to grow, and willbe modest for some time to come, thus limiting the number of existing server users who will beimpacted.

The entire Asia/Pacific (APAC) region is witnessing limited traction of ELE servers. Per our serverresearch, all of APAC reported single-digit ELE server shipments during 1Q12. A limited number ofglobal vendors are active in the region, including India, which further limits technology penetration.Global vendors should see this as a huge opportunity to work in these markets. Going forward,


there may be few new hyperscale data center build outs specially hosting companies that mayinvest in this technology, given that India is increasingly challenged by energy supply shortages andincreasing supply costs.

User Advice: Clients for whom all the following are true should look at low-energy servers now:

■ Most of the work running in the data center has the light CPU requirements that suit thesedesigns.

■ The capabilities and culture of the organization are compatible with undertaking leading-edge orbleeding-edge IT projects.

■ The anticipated result of deploying on low-energy servers displaces or avoids the purchase ofsubstantial numbers of traditional servers.

■ Sufficient resources, spare talent and management attention exist to take on a demanding newproject, along with the ability to rapidly assess feasibility and costs.

■ The code is portable to this platform via recompiling, installing a targeted, alternate version fromthe software provider, or running under a provided interpreter (e.g., Java or scripts).

■ The product is sold and adequately supported in the area where it will be deployed.

■ Indian organizations should wait for product availability and local support before deciding toinvest in this technology.

Clients that face severe constraints on growth or profitable operation of their businesses (suchconstraints might be resolved by a dramatic reduction in energy costs, or a dramatic increase incapacity in the same data center envelope) should undertake a quick assessment of the challengesand efforts involved in deploying low-energy servers. Many Indian data centers have five- to seven-year-old infrastructures that may merit considering these servers for few workloads as a part ofconsolidation. They should compare the costs, risks and challenges with feasible alternatives thatcould address their constraints. Interested customers should prepare a deployment plan, andshould invest considerable time in proofs of concept for a set of identified workloads.

Clients that do not match either set of these conditions should periodically revisit the low-energyserver trend to judge when its maturity reaches a point that would justify a deeper study. For mostof Gartner's clients, the time for such study is not now.

Business Impact: For enterprises that find this option a good fit technically and organizationally,these alternative servers may substantially ease energy costs, especially for those burdened bylarge expenditures. Organizations with data centers in large Indian cities where power costs arehigh can consider this technology a viable option to reduce operating expenses. Similarly, theseservers can support considerably more capacity in an existing data center space than traditionaloptions, avoiding the need for construction or relocation to other data centers. Again, this is trueonly if the situation provides a very good fit for an alternative server approach.

Users that are a perfect fit for the new server types may realize a greener outcome in the energyrequired to support their businesses than with traditional, less energy-frugal machines. However,


this will only materialize if the actual net energy used for the user's real workload is lower than whatis achievable when running on the most efficient traditional server deployments. India is witnessingsignificant growth in the hosting provider space, with current players expanding their capacity andnew providers joining the fray. Given the competitive cost pressures, hosting/co-location serviceproviders can evaluate this as an alternate for upcoming capacity creation.

For the remainder of potential users, or those who can use these servers for only a small part oftheir total IT needs, the benefits will be, at most, a modest improvement in cost and a tokenimprovement in ecological factors.

Benefit Rating: High

Market Penetration: Less than 1% of target audience

Maturity: Emerging

Sample Vendors: AMD; Calxeda; Nvidia; Quanta Technology; Super Micro Computer

Recommended Reading: "Cool Vendors in High-Performance Computing and Extreme-Low-Energy Servers, 2012"

"Extreme Low-Energy Servers Aren't Built Only With ARM and Atom"

Intelligent Transportation System

Analysis By: Ganesh Ramamoorthy

Definition: An intelligent transportation system (ITS) is a collection of technologies and applications.From traveler information systems, transportation management and pricing, to public transportation,vehicle-to-infrastructure and vehicle-to-vehicle integration, ITSs involve the use of information andcommunication technology to improve the passenger safety and operational performance oftransportation companies, reduce traffic congestion, enhance mobility for travelers, and deliverimproved productivity and environmental benefits for society at large.

Position and Adoption Speed Justification: The Indian economy is growing at a fast pace, andthis has placed the country's transportation infrastructure — which is already deficient in capacityand efficiency — under immense stress. ITSs are needed today, more than ever, to ensure thattraffic is managed efficiently and to prepare India for its future growth. To overcome thesedifficulties and bottlenecks in public transportation, the Department of Electronics and InformationTechnology (DeitY) — under the Indian government's Ministry of Communications & InformationTechnology — initiated the ITS project in October 2009, with the Centre for Development ofAdvanced Computing (CDAC), Thiruvananthapuram, as a nodal agency and the Indian Institute ofTechnology, Chennai and Mumbai, and Indian Institute of Management, Kolkata as the collaboratingagencies.

The DeitY has set up an embedded Centre of Excellence on ITS at CDAC, and has outlined eightprojects aimed at bringing the benefits of advanced traffic management and control systems forgeneral public to traffic police, traffic planners, town planners and development authorities in India.


ITS encompasses a broad range of wireless and wireline communications-based information andelectronics technologies. When integrated into the transportation system's infrastructure, and invehicles themselves, these technologies relieve congestion, improve safety and enhanceproductivity. The key projects under ITS include:

■ Wireless traffic control system — Aimed at the traffic police and local authorities.

■ Second-generation area traffic control system (ATCS) — Aimed at midsize and large citiesdeploying ATCS.

■ Real-time traffic counting and monitoring system — Aimed at traffic planners and developmentauthorities.

■ Intelligent parking-lot management system — Aimed at town planners and local authorities.

■ Advanced travelers information system — Aimed at general public and traffic planners.

■ Intelligent transit trip planner and real-time route information — Aimed at the general public andtraffic planners.

■ Red light violation detection system — Aimed at traffic police and traffic managementauthorities.

■ Intelligent traffic congestion management system using RFID — Aimed at traffic planners anddevelopment authorities.

The wireless traffic control system, intelligent parking lot management system, and the intelligenttraffic congestion management system using RFID are complete, and are currently being rolled outto interested industries for commercial exploitation. The National Highways Authority of India (NHAI)— under the National Highways Development Programme (NHDP) — has budgeted $600 milliontoward building highways, expressways, by-passes and bridges until 2015, and has estimated anadditional $370 million investment from the private sector. This program will require investment inITS frameworks across India and the government has already awarded concessions to 32companies for implementing intelligent solutions in line with its 20-kilometers-per-day highwaybuilding program.

At present, the ATCS is fully complete and has been implemented in Mysore as of the 1Q12. Othercities where the ITS is scheduled to be rolled out during the next couple of years includeHyderabad, Indore, Pune, Delhi and Chennai. The CDAC estimates that there is potential toimplement ITSs in at least 200 cities and towns across India during the next five years. Overall,therefore, we believe that the ITS is currently just about emerging in India, and we expect thesesystems to be fully adopted by state transport corporations, municipal corporations, trafficmanagement authorities and the general public during the next five to ten years.

User Advice: Town planners and other concerned authorities should systematically consider thetraffic management issue and execute on plans with clear milestones and a timeline for rolling outthese systems without disrupting the existing infrastructure. When building the new trafficinfrastructure, the authorities should consider running design trials of these systems to identifyglitches and issues and to establish escalation strategies to address emergency situations. Also,


motor vehicle departments from different states should collaborate to avoid duplicate investmentand system compatibility issues.

Business Impact: An ITS provides a single point solution for transport companies to monitor andmanage their vehicle fleet better, while keeping costs under control and reducing energyconsumption. In developed cities in India, these systems are increasingly becoming a must have toaddress today's traffic congestion issues. With the growing amount of motor traffic and urbanizationin India, more municipal corporations and traffic police are demanding these systems to bettermanage their city traffic infrastructure. Therefore, solutions addressing these needs will have asignificant impact for both the users and the providers for years to come. Solution providers shouldtherefore address flexibility and scalability issues while implementing these solutions. They shouldleverage their learning in other large cities, to demonstrate value and develop innovative solutionsthat address different customer segments — such as logistic companies, general public, motorvehicle users and others — to gain greater benefits.

Benefit Rating: Moderate

Market Penetration: 1% to 5% of target audience

Maturity: Emerging

Sample Vendors: Aftek India; IBM; Siemens



Definition: Satellite navigation systems are based on GPS and other national and multinationalsatellite initiatives (for example, Glonass and Galileo) with applications in consumer and commercialmarkets. Satellite navigation systems are embedded in a vehicle, available as a portable unit(personal navigation devices [PNDs]) and offered as an application in cellular phones with aninternal or external GPS antenna, or based on a cellular tower or Wi-Fi-enabled triangulation(assisted GPS).

Position and Adoption Speed Justification: Navigation solutions are now available in India formotorbikes and cars. These solutions typically come with a GPS navigator loaded with city maps, 5-inch touchscreen, FM transmitter and hands-free Bluetooth connection. Some of these solutionsalso combine entertainment solutions such as music/video playback, e-book readers, photobrowsers and camera support. Some of the current popular PND hardware brands in India includeGarmin, MiTac, Moov, Delphi Nav, Amax and SatGuide.

Navigation systems based on GPS are just about gaining popularity in India. Although theseservices were launched in India during 2007, it was only during 2009 that the market seemed toreach critical mass. The growing automobile population, combined with the increasing affordabilityof these solutions in India, will act as a key driver for the growth of these navigation solutions in thecountry. Besides cars, where navigation solutions coupled with entertainment solutions areincreasingly finding a natural home, motorbikes are also being targeted by navigation solutionproviders. Given the large "two-wheeler" population in the country and the growing four-wheeler


sales, including cars, trucks and other transport vehicles, we believe, during the next two to fiveyears, the adoption of navigation solutions in India will grow rapidly.

User Advice: Vehicle and device manufacturers in the India market must reduce prices forembedded and PND navigation solutions to compete with alternative platforms (specifically, cellularphones) and market them as part of a complete telematics offering. As India is a big market forafter-sales solutions in the automobile segment, navigation solution providers should partner andcollaborate with automobile dealers and retailers to differentiate their solutions and offer addedfunctionality in the form of dynamic, location-based services, such as useful traffic information,buddy finders and enabling device integration.

Business Impact: Additional revenue streams are possible, especially with expanded feature setsand the potential integration of telematics services or location-based services that use Internetcontent.



Maturity: Emerging

Sample Vendors: Google Maps; MapmyIndia; Nokia

COBIT

Analysis By: Tapati Bandopadhyay; George Spafford; Ian Head

Definition: COBIT, owned by ISACA, originated as an IT control framework, and has evolved into abroader IT governance and management framework. COBIT 4.1 is used by many midsize to largeorganizations across a wide range of industries. Most use of COBIT 4.1 today is to implementcontrols to manage key risks or meet an audit or compliance requirement. Few operations leadersuse it as a broad framework to manage and govern the creation of value.

Position and Adoption Speed Justification: COBIT 5, released in April 2012, will have a steadilyincreasing effect on IT operations as IT operations organizations begin to increasingly realize itsbenefits, such as more-predictable operations, and as more enterprises adopt it and issuemandates for IT operations to comply with it.

COBIT 5 has the potential to act as a unifying force in the management and governance of the ITorganization and the wider business. As a control framework, COBIT is well-established, especiallyamong auditors and, therefore, while its indirect effect on IT operations can be significant, it'sunlikely to be a frequent point of reference for IT operations management. As typical IT operationsand other affected groups become more familiar with the implications of COBIT and awareness andadoption increase, the framework will progress slowly along the Hype Cycle. Gartner again saw anincrease in client inquiry calls in 2011, and expects interest to increase as IT operationsprofessionals increasingly understand how to leverage the framework for raising the maturity ofservice, process, risk and governance of IT.


User Advice: Even with the version 5 update and it's integration of ISACA's many frameworks, thefocus of this high-level framework is on what must be done, not how to do it. For example, theCOBIT framework identifies a software release as a control objective, but it doesn't define theprocesses and procedures associated with the software release. Therefore, IT operationsmanagement has typically used COBIT as part of a mandated program in the IT organization and toprovide guidance regarding the kind of controls needed to meet the program's requirements.Process engineers can, in turn, leverage other standards, such as ITIL, for additional design detailsto pragmatically use. Despite version 5's expansion, it still complements rather than replaces ITIL.COBIT 5 has the potential to be the tool used by leaders to identify business and IT needs, and themost appropriate framework or standard to address those needs.

Because COBIT 5 has adopted the ISO15504 process maturity model and also incorporates COBIT4.1, Val IT 2.0, Risk IT, Business Model for Information Security (BMIS) and the InformationTechnology Assurance Framework (ITAF), COBIT 4.1 expertise will have limited applicability toCOBIT 5. Consequently, a major training and familiarization exercise will need to be undertaken byorganizations adopting COBIT 5 as a successor to COBIT 4.1. This is the reason it has beenbrought back toward the beginning of the Hype Cycle, as penetration of COBIT 5 is not yet maturein the global market and is very low in the Indian context.

IT operations managers who want to assess their management and governance to better mitigaterisks and reduce variations, and are aiming toward clearer business alignment of IT services, shoulduse COBIT in conjunction with other frameworks, including ITIL and ISO 20000. Those IT operationsmanagers who want to gain insight into what auditors will look for, or into the potential implicationsfor compliance programs, should also take a closer look at COBIT; however, adoption of COBIT 5can only be successful if the wider enterprise embraces the framework. Any operations team facinga demand for wholesale implementation should push back and focus its application in areas wherethere are specific risks in the context of its operation.

COBIT 5's scope is the entire enterprise, therefore IT operations managers can refer to this source ifthey believe the goals of the enterprise are not clearly communicated and cascaded to their ownfunctional teams. Services and processes and their associated capabilities must now be focused ataddressing the explicit goals of the enterprise and not simply to implement a complete set ofcontrols unless each relates to meeting a specific goal.

Where COBIT 5 is adopted by an organization, an audit would also highlight where business goalsare not well articulated or the goal's implications are not cascaded down into IT operations' goals.

These cascading goals can serve as audit trails to justify the IT activities and processes andservices, and can help build business cases around each of them at the different levels of detail asrequired. Each COBIT process is part of a cascade that links directly to business goals to justifywhat it focuses on, how it plans to achieve the targets and how it can be measured (metrics).

Inquiries in India in 2011 related to IT service management (ITSM) practices revealed advancedawareness and application of COBIT only in a handful of IT organizations. IT teams, especially fromIndian fast-growing and sunrise sectors such as banking, financial services and insurance (BFSI),pharmaceuticals, healthcare, etc. can leverage the governance guidance in COBIT to increase theeffectiveness of their IT services in supporting business goals of their organizations.


Business Impact: While COBIT 5 moves COBIT toward a broader management and governanceframework, it is seen by most users as a framework for effective governance and reducing risk. Itaffects all areas of managing the IT organization, including aspects of IT operations. Managementshould review how COBIT 5 can be used to enhance governance practices and help better managerisks and, thus, result in improved performance. COBIT's usefulness has moved a long way beyonda simple audit tool.



Maturity: Emerging

Recommended Reading: "Leveraging COBIT for Infrastructure and Operations"

"Understanding IT Controls and COBIT"

"Updates in COBIT 5 Aim for Greater Relevance to Wider Business Audience"


Analysis By: Bhavish Sood; Mark A. Beyer

Definition: The capability to resolve multiple labels for individuals, products or other noun classesof information into a single resolved entity in order to analyze relationships among resolved entities.Advanced forms of entity analytics include the ability to reverse the resolution when appropriate andcommunicate that reversal to all client systems.

Position and Adoption Speed Justification: Entity resolution and analysis (ER&A) leverages manyaspects of data integration, master data management (MDM) and data quality (DQ). ER&Aeventually becomes instrumental to the success of each of these practices. Additionally, all four ofthese disciplines (that is, data integration, MDM, DQ management and ER&A) make up a significantportion of the implementations which take place under enterprise information management (EIM).

As a technology and practice, ER&A forms a bridge between expectations and practices regardingthe input and management of data across various systems and even different information channels(for example, social versus back-office, customer-driven portals versus operations management). In2012, organizations will continue to focus on resolution, rather than analytics, which has given riseto the false hope that DQ or MDM will resolve these issues. Data architects and informationmanagers have begun to ask, "Why isn't entity resolution part of data quality?" and "Why doesn'tMDM also do this as a set of functions?" The answer is that ER&A should be a shared DQ and MDMfunction, and will most likely be driven by DQ discovering issues and MDM resolving them. Somevendors claim they accomplish ER&A simply through DQ and MDM on either side, but then fail tocomplete the workflow expectation of resolving networks into individuals, and the reverse, and thentracking those changes into all client systems. ER&A has significant benefits; however, it willultimately merge into DQ technology and MDM practices between 2013 and 2015. Additionally,analytics technology that extracts the identifying information — used in reconciling entities from


audio, video, image and other unstructured data types — is needed for the technology to reach itsinherent potential.

There is also a growing awareness in the government sector of the advantage of using ER&Atechnology in projects such as issuing unique identity numbers to Indian residents through theUnique Identification Authority. Marketing and customer service organizations are also evaluatingthe use of this technology in their functions, especially in India's telecom and financial servicessectors. As both state and federal governments in India embark on ways to address leakages in thevarious welfare schemes floated by them — making sure that only the eligible population receivesthe appropriate benefits — ER&A will become an important technology in India's e-governancejourney. Some early adopters of this technology include:

■ Indian banks, for their "Know Your Customer" initiatives.

■ Department of Income Tax, for 360-degree profiling of Indian tax payers.

■ Insurance companies, for getting a single view of the customer.

User Advice: Fraud detection and other criminal investigation techniques can use these solutions toenhance their use of available information. DQ stewards and data governance experts can usethese as forensic tools. Through 2014, commercial applications of this technology will bechallenged, because DQ problems will diminish the interest of the analytics portion of ER&A andonly half of the problem will be solved.

Use of this technology should include the adoption of data stewardship and dedicated analysts tointerpret the results. It is important to understand that the greatest benefit from this technologyclass emerges from both facets — entity resolution and analytics — and the use of entity resolutiontools only sets the stage for analytics. In fact, failure to include analytics (specifically the absence ofnetwork awareness) will cause this technology to drop into the Trough of Disillusionment, whileentity resolution moves up the Slope of Enlightenment as a much-reduced, "battle scarred" stand-alone solution. Review the vendors' entity resolution tool road maps for eventual integration withanalytics or DQ.

Business Impact: Between 2011 and 2015, organizations will pursue ER&A as part of either theirMDM or DQ approaches to governance. In business data, multiple references may result from dataentry errors, inconsistency due to multiple systems for entering data, intentional falsification ofinformation or the creation of false identities. Resolving these issues will allow organizations toexperience significantly improved relationships with their clients and business partners.

Benign uses of ER&A (for example, alternative bill of materials analysis and consumer referencenetworks) will see rapid results from using this technology; because it quickly identifies data issuesand suppliers, services partners and distribution partners will be better able to communicate withthe business. Additionally, after resolving individual identities and the networks of activityperpetrated by those individuals, it becomes possible to detect the presence of shadow processesthat may actually replace formal or approved processes in an organization. One of the potentiallyhigh benefits lies in the development and analysis of social networks.


Unfortunately, criminals will exercise their creativity in circumventing these systems. Linking thistechnology with voice and speech recognition solutions, as well as text analysis, will assist instaying ahead of criminal countermeasures.



Maturity: Emerging

Sample Vendors: IBM; Infoglide Software; Informatica; Posidex Technologies

Recommended Reading: "Top 10 Technology Trends Impacting Information Infrastructure, 2011"

"Magic Quadrant for Data Quality Tools"

"Magic Quadrant for Master Data Management of Customer Data"

"Magic Quadrant for Master Data Management of Product Data"


Analysis By: Arup Roy; Jim Longwood; Biswajeet Mahapatra

Definition: Compute infrastructure services are a type of infrastructure as a service (IaaS) offering.They offer on-demand computing capacity from a service provider. Rather than buying servers andrunning them within its own data center, a business simply obtains the necessary infrastructurefrom a service provider in a shared, scalable, "elastic" way and accesses it via the Internet or aprivate network.

Position and Adoption Speed Justification: IaaS in India has been growing gradually as anevolving market, with both service providers and consumers taking initiatives and testing differentofferings, watching how the market and competition are reacting, and then moving with the nextoffering. The Indian IaaS market is not as evolved as other markets, particularly in the U.S. andEurope, and it will take more than five years to evolve and mature to the level where the U.S. andEuropean markets are.

The bottleneck in the initial growth is because of:

■ Lack of maturity of the Indian offering among the IaaS providers

■ Uncertainty around SLAs

■ Lack (albeit improving) of customer awareness

■ Data security concerns

■ General murkiness about regulatory compliance and how it would impact this model becausethe data would reside outside organizations


The IaaS provider ecosystem in India has matured slightly in the last year, although there still arenot many players that can be qualified as cloud IaaS providers per the Gartner definition, whereinreal-time elasticity, agility, pay-as-you go and self-service are important components. Most of thecloud IaaS service providers in India do not have a self-service portal and are billed monthly basedon monthly usage configured once or twice a month, which means no real-time elasticity and agility.Hence, they cannot be classified as true cloud-based IaaS providers. We see a focus oninfrastructure utility or hosted IT service offerings in India.

On the evolving demand side, and based on recent survey feedback, we believe that high-growthIndian companies, in particular, are seeking IaaS services. Their drivers are to avoid upfront capitalinvestments in new projects and to enable faster solution rollout, and situations where there aretemporary needs for additional capacity, such as tests/pilots, but also to overcome a lack of highlyskilled and experienced IT staff for ongoing management of increasingly complex data centersolutions. This will also lead to maturing outsourcing services.

Small or midsize businesses (SMBs) and Internet companies, such as retail chain stores, educationand technology firms, are early users because they are reluctant to build up their own data centersto support highly scalable business. The choices of IaaS providers are very limited as of now.

The transition from traditional to new approaches will take at least five years, as there is a stronglegacy of government and enterprise users having traditional insourced infrastructure services ormoving into first- and second-generation outsourcing deals. One of the key accelerators of thistransition will be associated with improvements in IaaS price and billing approaches, and one of thekey inhibitors will be providers' lack of operational maturity.

User Advice: Although Indian enterprises should consider IaaS because of the increased flexibilitysuch services offer, enterprises should also be aware of the level of immaturity of many offerings. Inparticular, enterprises should evaluate the specific contractual service definitions of these services,including scope and service levels, the degree of flexibility and on-demand capabilities offered, andthe associated pricing structures — for example, whether the service can scale up and down ondemand. A key aspect in the sourcing of these services is thus to evaluate the key performancemetrics guaranteed and the associated SLA.

Enterprises should:

■ Recognize that most IaaS offerings are in the early stages and will evolve over time. Enterprisesshould select services based on specific requirements and not use IaaS for their mission-criticalapplications for at least another two years.

■ Build a tactical sourcing strategy, identifying the particular infrastructure services that arecandidates for IaaS (for example, ad hoc project work supported by software as a service[SaaS] offerings running on IaaS platforms or application development and testing). Enterprisesshould define the service and cost outcomes they require in the resulting sourcing action planand, because these services are still immature, they should incorporate an exit strategy in caseof performance problems.

■ Ensure, when evaluating IT outsourcing service providers, that they have sound servicemanagement methodologies that are aligned with, or based on, industry best-practice


frameworks and standards, such as ITIL v.3, Six Sigma and International Organization forStandardization (ISO) 20000. They should not focus too much on costs until they haveestablished that the candidate service providers can deliver the required services in the desiredlocations at the needed quality of service (see "How to Ensure Infrastructure Providers CanDeliver Service Excellence").

■ Ensure that these services are enabled with a Web portal that not only allows for on-demandreal-time configuration changes, but also maintains a detailed real-time reporting of usage andbilling-related statistics.

Business Impact: IaaS enables enterprises to reduce upfront capital expenditure on infrastructure,as well as ongoing maintenance and management costs. It allows them, instead, to source at leastpart of their IaaS based on business needs and to pay on a pay-per-use basis. Besides replacingcapital expenditure with operational expenses in a pay-as-you-go model, this also allowsenterprises to make more effective use of their resources and more accurately match theirexpenses with their day-to-day needs.

The service also enables a higher degree of flexibility or agility, as enterprises can scale resourcesmore quickly and respond to fluctuations in business needs. This can replace the headache ofproactive capacity planning and forecasting with highly flexible and responsive services.



Maturity: Emerging

Sample Vendors: Airtel; CtrlS; Dimension Data; Netmagic; Reliance Data Center; Sify; TataCommunications; Wipro

Recommended Reading: "Adopting Cloud Infrastructure as a Service in the 'Real World'"

"Evaluating Cloud Infrastructure as a Service"

"The Impact of Cloud Computing on Sourcing Strategy Models"

"Cloud Sourcing Deals Anatomy: From Public to Private, From Services to Technology Lock-In"

"Data Center Services: Regional Differences in the Move Toward the Cloud, 2012"

"Top Six Adoption Trends for Cloud Compute IaaS in India"

"User Survey Analysis: Infrastructure as a Service, the 2011 Uptake"


Analysis By: Vishal Tripathi; Naresh Singh


Definition: A hosted virtual desktop (HVD) is a full, thick-client user environment run as a virtualmachine (VM) on a server and accessed remotely. HVD implementations comprise servervirtualization software-to-host desktop software (as a server workload), brokering/sessionmanagement software to connect users to their desktop environments, and tools for managing theprovisioning and maintenance (e.g., updates and patches) of the virtual desktop software stack.

Position and Adoption Speed Justification: An HVD uses server virtualization to support thedisaggregation of a thick-client desktop stack that can be accessed remotely by the user. Bycombining server virtualization software with a brokering/session manager that connects users totheir desktop instances (that is, the OS, applications and data), enterprises can centralize andsecure user data and applications, and can centrally manage personalized desktop instances.Because only the presentation layer is sent to the accessing device, a thin-client terminal can beused. For most early adopters, the appeal of HVDs was the ability to "thin" the accessing devicewithout significant re-engineering at the application level (usually required for server-basedcomputing).

While customers implementing HVDs cite many reasons for deployments, three key factors havecontributed to the increased focus on HVD: the desire to implement new client computingcapabilities in conjunction with Windows 7 migrations, the desire for device choice (in particulartablets and smartphones), and the uptick in customers focused on security and compliance issues.During the past few years, adoption of virtual infrastructures in enterprise data centers hasincreased, making HVDs easier to deploy. With this comes a level of maturity and an understandingof how to better utilize the technology. This awareness helps with implementations of HVD wheredesktop engineers and data center administrators work together.

Early adoption of this technology was hindered mainly by licensing compliance issues for theWindows client OS, although this was resolved through Microsoft's Windows Virtual DesktopAccess (VDA) licensing offerings. This was only one aspect of the higher total cost of ownership(TCO) associated with broad-scale HVD implementation. While many IT organizations had madesignificant progress in virtualizing their data center server infrastructure, HVD implementationsrequired additional virtual capacity for server and storage (beyond what was in place for physical tovirtual migrations). Even with Microsoft's reduced license costs for the Windows OS, enabling anHVD image to be accessed from primary and secondary devices for one license fee, other technicalissues have hindered mainstream adoption. Improvements in the complexity of brokering softwareand remote access protocols will continue through 2012, extending the range of desktop userscenarios HVDs can address. Yet, adoption will remain limited to a small percentage of the overalldesktop installed base.

Because of the constraints, broad applicability of HVDs has been limited to specific scenarios,primarily structured-task workers in call centers, kiosks, trading floors and secure remote access.About 50 million endpoints remain the target population of the total 700 million desktops. Throughthe second half of 2012 and into 2013, we expect general deployments to continue. Inhibitorsinvolve the cost of the data center infrastructure required to host the desktop images (servers andstorage, in particular) and network constraints. Even with increased adoption of virtualinfrastructure, cost-justifying implementations remains a challenge, because of HVD costcomparisons with those of PCs. Some advancements in leveraging application virtualization makeHVD less cumbersome by introducing the ability to layer applications. This makes managing the


image and maintaining the HVD easier. The availability of skills to manage virtual desktops is anongoing challenge, as is deploying HVDs to mobile/offline users, despite the promises of offlineVMs and advanced synchronization technologies.

Through 2012, the manageability of HVD VMs will expand, as techniques to reduce HVD storagevolumes lead to new mechanisms for provisioning and managing HVD images by segmenting theminto isolated components (including OSs, applications, persistent personalization and data). Thesesubsequent improvements will extend the viability of HVD deployments beyond the structured-taskworker community — first to desk-based knowledge workers, then to new uses, such as improvedprovisioning and deprovisioning, and for use by contractors and offshore developers.

HVD marketing has promised to deliver diminishing marginal per-user costs due to the high level ofstandardization and automation required for successful implementation. However, this is currentlyonly achievable for persistent users where images remain intact — a small use case within theoverall user population. As other virtualization technologies mature (e.g., brokers and persistentpersonalization), this restraint decrease. This creates a business case for organizations that adoptHVDs to expand their deployments once the technology permits more users to be viably addressed.Enterprises that adopt HVDs aggressively will see later adopters achieve superior results at lowercosts, and will need to migrate to new broker and complementary management software asproducts mature and standards emerge. This phenomenon will push HVDs further into the Troughof Disillusionment in late 2012.

User Advice: End users must accept the likelihood that HVD will not provide an immediate costsavings, and should expect high capital costs in the short run. Focus on HVD's role in addressingthe organization's strategic and high-priority business requirements when justifying projects toupper management. Involve major business stakeholders when building the business case. Beforereaching the project stage, examine the organization's IT maturity, especially the extent of servervirtualization, infrastructure management and data center consolidation, to determine whether it isready for HVD; a successful deployment is highly dependent on these factors.

Increased deployment will occur in India between 2013 and 2014, due to the technology maturingand a slight decline in costs. Clients that make strategic HVD investments now will gradually buildinstitutional knowledge. These investments will allow them to refine their technical architecture andorganizational processes, and to increase internal IT staff expertise before IT must support thetechnology on a larger scale through 2016. Balance the benefits of centralized management withincreased infrastructure overhead and resource costs. HVDs may resolve some managementissues, but are not panaceas for unmanaged desktops. In most cases, the promised reductions inTCO will not be significant, and will require initial capital expenditures to achieve. The best-casescenario for HVDs remains securing and centralizing data management, and structured-task users.

Organizations must optimize desktop processes, IT staff responsibilities and best practices to fitHVDs, just as they did with traditional PCs. Leverage desktop management processes for thelessons learned. The range of users and applications that can be viably addressed through HVDswill grow steadily through 2012. Although the user population is narrow, it will eventually includemobile/offline users. Organizations that deploy HVDs should plan for growing viability across theiruser populations, but should be wary of rolling out deployments too quickly. Employ diligence in


testing to ensure a good fit of HVD capabilities with management infrastructure and processes, andintegration with newer management techniques (such as application virtualization and softwarestreaming). Visibility into future product road maps from suppliers is essential.

Business Impact: HVDs provide mechanisms for centralizing a thick-client desktop PC without re-engineering each application for centralized execution. This appeals to enterprises on the basis ofmanageability and data security.



Maturity: Emerging

Sample Vendors: Citrix Systems; NComputing; VMware


Analysis By: Rakesh Kumar; John R. Phelps

Definition: Server power capping involves the use of software tools that limit the amount ofelectrical power allocated to a server. When that threshold is reached, the tool will restrict furtherworkloads. Although this approach seems logical and simple, it masks a great deal of complexityabout system integrity, software support, etc.

Position and Adoption Speed Justification: Server power-capping tools have been around formore than four years, and, although they have matured, they require careful planning. Differentorganizations use and operate servers in different ways. Data centers have service and performancelevels that need to be met, and the capping of a server's capacity and performance based onenergy use should never compromise those service levels. Using a power-capping tool will restrictor govern workload capacity based on defined policies that comprise technology, business andfinancials. However, many data centers are under pressure to better use their hardware assets andlower the operational costs of running their data centers, so the use of server power-capping toolswill increase during the next few years.

Another issue that users need to be aware of is that system vendors will attempt to use these toolsfor competitive advantage by embedding their tools in their hardware products in a proprietarymanner. Moreover, they will link these tools to their own system and network managementconsoles. Although most APIs will be open enough to allow users to integrate the tools with otherproducts, this requires a degree of software development and maintenance.

Over the last year, most of the system vendors have improved their server power capabilities andwe have seen organizations begin to use the technique in noncritical environments.

User Advice: Server power-capping tools will need to be integrated with other data center systemand performance management tools, as well as other data center infrastructure management(DCIM) products. Data center efficiency dashboards should incorporate data from these tools.Users need to understand the effect of these tools on operational processes, especially in the areas


of performance, availability and service delivery. Hence, infrastructure teams must work closely withtheir operational teams to ensure that the power-capping tools are used successfully. Power-capping tools also enable administrators to reduce the risk of computer overload, which couldotherwise drive server power consumption beyond the limit of the data center and cause acatastrophic shutdown.

Business Impact: The appropriate use of these power-capping tools will enable data centermanagers to better manage the energy portions of their budgets and will help internal, energy-based chargeback.



Maturity: Embryonic

Sample Vendors: 1E; CA Technologies; HP; IBM

Recommended Reading: "How to Select and Implement DCIM Tools"

BPaaS

Analysis By: Frances Karamouzis

Definition: Gartner defines business process as a service (BPaaS) as the delivery of businessprocess outsourcing (BPO) services that are sourced from the cloud and constructed formultitenancy. Services are often automated, and where human process actors are required, there isno overtly dedicated labor pool per client. The pricing models are consumption-based orsubscription-based commercial terms. As a cloud service, the BPaaS model is accessed viaInternet-based technologies.

Position and Adoption Speed Justification: The landscape of BPaaS offerings has several keycharacteristics:

■ Highly diverse across a large number of business processes and industry subsegments.

■ Embryonic regarding the understanding of what constitutes a BPaaS offering, its valueproposition and scope.

■ Evolving rapidly; new offerings are emerging every quarter.

■ Fragmented across a large array of processes (and subprocesses) as well as a large crosssection of industry-specific services (e.g., banking, insurance, pharmaceuticals). Hence,different types of BPaaS are maturing at different rates. In the sample list of vendors below,Gartner provides examples that illustrate a wide array of options. For example, Genpact has aBPaaS offering that focuses on an order-to-cash process. Accenture has one BPaaS offeringfocused on a specific insurance process related to first notice of loss.


Gartner's analysis (at this early stage of emerging cloud business services) reveals thesedevelopments in the market dynamics of the BPO industry (specific to BPaaS):

■ The largest BPO deals in size, scope and complexity often focus on large multinationalorganizations for HR, finance and accounting, operations, or industry-specific processes. Thesedeals often cross several categories of service, including people, process workflow structures,enterprise applications, enhancement software and infrastructure. Gartner's current view of themarket, based on client inquiry and vendor briefing discussions, is that such extensive andcomplex deals are not utilizing BPaaS offerings as an extensive element of these deals.However, smaller, modular-specific components of these large complex solutions may bereplaced by cloud-enabled elements. The more focused and targeted business processservices (BPSs), especially within microvertical industries, are the biggest areas of growth.

■ The longer-term impact will be that BPaaS offerings will serve to change the view andperception of how business processes are scoped (and componentized), acquired, packaged,priced and delivered. The adoption of specific BPaaS offerings will be a catalyst for investmentand will continue to trigger more exploration by vendors. Gartner believes BPaaS offerings willrepresent a more granular and modularized offering than the large complex BPO offerings thatare dominant today. In fact, for a long time, traditional BPO offerings and selective highlyverticalized BPaaS offerings will be the norm.

■ Given the nature of a BPaaS offering as more granular and modularized, there will be a need tocarve out specific business process elements (subprocesses, activities or tasks) as the basis forthe scope of new cloud service offerings. This is identical to the dynamics that are currentlyafoot in the software as a service (SaaS) marketplace. Few if any SaaS offerings areenterprisewide suites of functionality. Most SaaS offerings are department-specific or verticallyspecific offerings that address a very narrow scope of functionality (often requiring lots of appsto fully enable a business process). Hence, we anticipate that, over time, this will drive aproliferation of BPaaS offerings, which are small and narrowly targeted.

■ Furthermore, a zeal for cutting the cost of delivery of business processes, or of leveraging themfor growth, will also give rise to a decoupling of subprocesses, activities or tasks from the largerend-to-end business processes. Specifically, each component or piece of a business process— whether defined by function or task — will be scrutinized for optimized delivery options.Optimization may be defined by various levels of efficiency, effectiveness or agility. Eachprocess element (decoupled component) can represent a net new BPaaS. This decoupling ofbusiness processes causes offerings to become more modular and to be sold in more granular"nuggets" (for example, payment processing to a service like PayPal).

■ Given the hype of cloud and the significant market potential for BPaaS, a huge number of largeand small vendors are feverishly developing and piloting offerings with early-adopter clients.The difficulty with BPaaS is that it can span multiple industries and focus on a specific channel.Hence, it's quite a dynamic market with a vast array of offerings that are quite fragmented. As aresult, Gartner believes the adoption of BPaaS will likely come in very targeted ways in specificindustries. This will result in a steady (relative small growth of the sourcing portfolio) butconsistent over a long time frame.


■ Similar to other types of outsourcing, the starting point for sourcing decision making will be tofocus on displacing services that have been traditionally delivered through internal resourcesand processes, which Gartner calls the inside-out approach. More specifically, this is theapproach where organizations have long-standing business processes that were developed in-house, and at some juncture, there is an evaluation of whether it should be outsourced (inside-out). The newer paradigm will be where sourcing teams proactively scan the market to uncoverideas and innovation that may be developed from external sources (such as BPaaS offerings).Sourcing options are already externally available and will begin to be an option that sourcingteams will consider (the outside-in approach).

■ Organizations will need to have a much higher level of transparency with all of theirconstituencies (employees, customers, suppliers). Business process workflows will requirehigher visibility and much tighter integration as the extent of the decoupling of the componentsof business processes increases. The new paradigm is one that completely rethinks the statusquo of the business, and it embraces dramatically deeper relationships with its customers,suppliers and partners. Businesses are not compartmentalized. A business is virtual and fluidwith its customers interacting with it from any device, anywhere and at any time. As a result,organizations will reject massively monolithic and inwardly focused concepts, and instead willseek out BPaaS.

User Advice: The embryonic and dynamic nature of BPaaS creates an imperative for business unit(BU) leaders and sourcing managers to have clear approaches as to how to guide theirorganizations. Enterprises will have more capabilities and a wider choice of vendors and services inthe cloud. This elevates the role that business unit leaders and sourcing officers must play in riskmanagement. The most important focus areas for CIO and sourcing managers include the following:

■ To be able to confidently separate hype from reality, as well as distinguish the key benefits anddifferentiating variables across different types of BPaaS offerings

■ To demonstrate leadership and develop a proactive approach to sourcing strategies, to stayabreast of what BPS approaches are being utilized or piloted by competitors in your industry.

■ To determine the best time and position within a BPS portfolio to evaluate BPaaS or conduct apilot

■ To ensure you are staying within market pricing and quality ranges for delivering BPaaS to yourorganization; service providers that can deliver something better, faster and less expensivelywill inevitably grab the attention of your constituency

■ To mine BPaaS offerings as ideas for innovation in your organization

■ To develop the baseline understanding of the variables required to do an accurate qualitativeand quantitative business case analysis across different BPaaS offerings

Given the hype of cloud, there have been and will continue to be many vendors heavily marketingtheir offerings and trying to position themselves to capture market share. However, not all of thevendors are using terms and nomenclature in the same way or offering a consistent scope or valueproposition. This has caused many BU leaders and sourcing teams to heavily debate the cost,


benefits and risks of solutions for similar or normalized scope. Therefore, organizations mustestablish a very collaborative and iterative approach to bringing together the right personnel withinthe organization to ensure that they are working all the focus areas above on a continual basis toaddress BPaaS dynamics.

Organizations will have to delight customers who are more informed than ever about their productsin changing markets. They want to know that the business cares about their immediate concerns.They also want to affect how the business works, but have a shorter attention span and morechoices available to them. Meeting these customer needs to generate customer-facing value will beone of the triggers for interest in BPaaS.

Business Impact: In the short term, it will be difficult to determine the portion of an overall sourcingportfolio that will be allocated to BPaaS offerings because the landscape of offerings is quitefragmented and diffuse. We expect that adoption will take a similar route as SaaS, where businessunit buyers will not necessarily work through the CIO organization. Specific purchases forsubprocesses may be small (as a percentage of total spending); however, the visibility, impact andassociated brand attribution and potential customer interest will be high. Therefore, the businessimpact with regard to top-line revenue or profitability is not expected to be material in terms ofdollar amounts, but the visibility and interest level can be game changing with regard to exploringnew channels and associated brand attribution for industry leadership.

The long-term impact of BPaaS will likely be larger within the overall business and IT serviceindustry. Moreover, Gartner feels that it will provide more choices for enterprise buyers and serve asanother force that will reshape the service provider landscape, because major barriers to entry suchas the need for capital-intensive assets will be removed.



Maturity: Embryonic

Sample Vendors: Accenture; American Express; Genpact; HP; IBM; LiquidSpace; RunMyProcess;TCS

Recommended Reading: "What's in a Name for Cloud Business Process Outsourcing Services:Explaining BPUs and BPaaS"

"Cloud Business Services: A Closer Look at BPaaS"

"Outsourcing Advisory: Sourcing Strategy Options and Approaches for Business Process Services"

"Advance Your Sourcing Strategy With Gartner's Self-Assessment Tool"

"How to Optimize Your Strategy in Business Process Outsourcing, 2010-2011"

"Predicts 2012: IT Services Sourcing Strategies and Execution Demand Proactive Diligence"

"Manage Risk and Unexpected Costs During the Cloud Sourcing Revolution"


At the Peak

Big Data

Analysis By: Sid Deshpande; Mark A. Beyer

Definition: Big data is high-volume, -velocity and/or -variety information assets that demand cost-effective, newly innovative forms of information processing that harness and enhance insight,decision making, and process automation.

Position and Adoption Speed Justification: Even though technologies are developing very rapidlyat a global level, there are very few real big data projects in India today. There is significant interestin big data in India, but confusion and hype persist in the market. Therefore, many end users are notsure how to view big data projects in a strategic manner and which technologies to use to get there.MapReduce is the current darling of big data processing, but it is a batch solution and therefore hasto be combined with other information management and processing technologies to providecomplex-event processing support and support for larger user populations. Hadoopimplementations require expert-level staff or system implementers, and this comes with cost andcomplexity implications that organizations often underestimate when planning big data projects.Attempts to combine MapReduce with Graph will follow as well as natural-language processing andtext analytics. Other big data assets, such as images, video, sound and even three-dimensionalobject modeling, will also drive big data into the trough. Some big data technologies represent agreat leap forward in processing management. As a result, these new technologies represent acapability to overtake existing technology solutions when the demand emerges to access, read,present or analyze any data. Throughout 2010 and 2011, big data focused primarily on the volumeissues of extremely large datasets generated from technology practices such as operationaltechnology, Internet logging, social media and streaming sources. A wide array of hardware andsoftware solutions has emerged to address the partial issue of volume.

The larger context of big data refers to the massive data creation venues in the 21st century. Bigdata practices introduce the concept that all data can be integrated and promotes the developmentof new technologies. This is in stark contrast to the current view that only selected data can beintegrated due to existing technology limitations. As a new issue with requirements that demand anapproach, the expansion of traditional boundaries will occur extremely fast because the manysources of new information assets are increasing geometrically (for example, desktops becamenotebooks and now tablets; portable data is everywhere and in multiple context formats). Theincreasing number of digital information devices is causing exponential increases in data volumes.Additionally, the information assets include the entire spectrum of the information contentcontinuum, from fully undetermined structure ("unstructured") to fully documented and traditionallyaccessed structures ("structured"). As a result, organizations will seek this as differentiation fromtheir competitors, so they can become leaders in their markets in the next two to five years. Thismakes big data a current issue demanding almost immediate solutions. Vendors are almostuniversally claiming they have a big data strategy or solution. However, Gartner clients have made itclear that big data must include large volumes processed in streams as well as batch (not justMapReduce), an extensible services framework that can deploy processing to the data or bring data


to the process and that spans more than one variety of asset type (for example, not just tabular orjust streams or just text). Importantly, the different aspects and types of big data have been aroundfor more than a decade — it is only recent market hype around legitimate new techniques andsolutions that has created this heightened demand. Early interest among Gartner's Indian clientshas come from the government/security, banking, manufacturing and telecom verticals. While mostdomestic companies in India are unaware or in an early exploratory phase of big data, a fewmultinationals have been running sophisticated big data projects as part of a broader globalinitiative. A few government organizations in India launching "greenfield" projects are exploring theopen-source option for a part of their requirements, helping validate big data in India in these earlydays of evolution. It is important to note that full-scale strategic implementations of big data in Indiaare few and far between, though Gartner expects organizations to rapidly ramp up in the near tomedium term due to the rapid maturation of the technology ecosystem and validation of thisecosystem by the entry of several large players into the competitive landscape.

The final and most important point is that current specialized technologies will become mainstream,and then the next "big data" issue will emerge and force even newer technologies and practices,constantly renewing itself.

User Advice: Identify existing business processes that are hampered in their use of informationbecause the volume is too large, the variety is too widespread or the velocity creates processingissues. Then identify business processes that are currently attempting to solve these issues withone-off or manual solutions.

Review existing information assets that were previously beyond existing analytic or processingcapabilities, determine if they have untapped value to the business, and make them a first or pilottarget of your big data strategy. In particular, look for information use cases that combine extremelydiverse information assets into analysis and data mining solutions.

Plan on utilizing scalable information management resources, whether they are public cloud, privatecloud or resource allocation (commissioning and decommissioning of infrastructure), or some otherstrategy. Do not forget that this is not just a storage and access issue. Complex, multilevel, highlycorrelated information processing will demand elasticity in compute resources similar to theelasticity required for storage/persistence.

Extend the metadata management strategies already in place, and recognize that more is needed toenable the documentation of these information assets, their pervasiveness of use, and the fidelity orassurance of the assets, tracking how information assets relate to each other and more.

Understand that open-source technologies are at the center of the big data revolution, andovercome cultural and organizational barriers while evaluating them. Several vendors in the marketoffer packaged distributions of freely available open-source projects or management frameworksbased on them, and in many cases, these may be a good starting point for a big data strategy.

Business Impact: There are three principal aspects to big data — success will be limited unless allare addressed. The quantitative aspects of big data generally do not emerge one by one. Volume,variety and velocity most often occur together. The second aspect is that innovation must be cost-effective both in costs to deploy and maintain, and in terms of time to delivery — solutions that


arrive too late are useless regardless of cost. Finally, the focus must be on increased insight by thebusiness into process optimization from immediate automation through the development ofcompletely new business models. Big data permits greater analysis of all available data, detectingeven the smallest details of the information corpus — a precursor to effective insight and discovery.The primary use cases emerging are: leveraging social media data, combining operationaltechnology (machine data) with back-office and business management data, and further validatingexisting assets (increasing their "fidelity").

One of the key areas that Indian organizations will need to assess before embarking on big dataprojects is the level of alignment of business and IT. Some early projects in India have notsucceeded; the failure was primarily due to the business units not involving IT as a strategicplanning partner during the early stages of big data initiatives. These cultural factors, in addition totechnological maturity, will have to be considered and addressed.

Big data has multiple use cases. In the case of complex-event processing, queries are complex withmany different feeds, and the volume may be high or not high, the velocity will vary from high tolow, and so on. Volume analytics using approaches such as MapReduce (the Apache Hadoopproject, for example) are valid big data use cases. In addition, the business intelligence use casecan utilize it in-database (for example, Aster Data and Greenplum), or as a service call managed bythe database management system (IBM Big Insights, for example), or externally through third-partysoftware and implementation services (such as Cloudera or MapR). Enterprises using portals as abusiness delivery channel have the opportunity already to combine geospatial, demographic,economic and engagement preferences data in analyzing their operations, and/or to leverage thistype of data in developing new process models. Life sciences generate enormous volumes of datain clinical trials, genomic research and environmental analysis as contributing factors to healthconditions.

The primary imperative remains. A new standard in determining cost-effective solutions hasemerged. Gartner estimates that organizations that have introduced all 12 dimensions of big data totheir information management strategies by 2015 will begin to outperform their unpreparedcompetitors within their industry sectors by 20% in every available financial metric.



Maturity: Emerging

Sample Vendors: Cloudera; EMC-Greenplum; HortonWorks; IBM; Teradata-Aster Data

Recommended Reading: "'Big Data' Is Only the Beginning of Extreme Information Management"

"How to Choose the Right Apache Hadoop Distribution"

"CEO Advisory: 'Big Data' Equals Big Opportunity"


ITIL

Analysis By: Tapati Bandopadhyay; George Spafford; Ian Head

Definition: ITIL is an IT service management framework that provides guidance on the full life cycleof defining, developing, managing, delivering and improving IT services. ITIL is owned by the U.K.Governments' Cabinet Office and is structured as five core books: service strategy, service design,service transition, service operation and continual service improvement. Specific implementationguidance is not provided, the focus being a set of good practices that an organization should adaptto its needs.

Position and Adoption Speed Justification: ITIL, since its inception, has been evolving throughvarious versions, the latest release being ITIL 2011. It is well-established as the de facto standard inservice management, and shares many concepts and principles with the formal servicemanagement standard ISO/IEC 20000 although the alignment is not perfect with differences thatreflect the different origins of the two bodies of work.

The current release, ITIL 2011, was the first update to the major version 3 release in 2007. ITIL hasthe highest adoption rate of the related frameworks used within IT operations (e.g., COBIT, CMMI,MOF), and is mainstream today. Based on our client discussions and conference attendee polls,uptake continues to grow slowly.

Organizations beginning service improvements now start with v.3 or 2011, and many groups thatwere using the previous version, v.2, are in various phases of transition.

The current version of ITIL, which includes a complete rewrite of the service strategy book, coversthe entire IT service life cycle and includes the addition of several new processes including strategymanagement, business relationship management, transition planning and support and designcoordination. The ITIL service life cycle begins with the development of strategies relating to the ITservices that are needed to enable the business. ITIL then introduces processes concerned with thedesign of those IT services, their transition into production and ongoing operational support, andthen continual service improvement. In general, service transition and service operation are themost commonly used books and could arguably justify a position higher on the Plateau ofProductivity while service strategy, being new as of July 2011, could be placed much earlier in theHype Cycle.

ITIL 2011 promotes the philosophy that IT be delivered so as to meet the needs of the business asefficiently and effectively as possible. This leads to a proactive approach to the delivery of ITservices which is reflected not only in the need to consider the business strategy in deciding what ITservices to deploy, but also in the prominence given to event management, capacity andperformance management and knowledge management.

Emphasis is placed on learning and feedback so that continual service improvement addresses allaspects of the IT services delivered, improving the business value of IT services.

Integration is a key focus in ITIL 2011. For example, integrated service asset and configurationmanagement, change and release management processes, together with problem management, all


working in a continual improvement framework can combine to raise the quality of IT servicesdelivered and enhance the business processes they support.

Despite some claims to the contrary, ITIL has a major role to play in operational process design,regardless of how it is sourced, even for cloud computing. All solutions require a blending ofpeople, processes and technologies. As part of this, there must be an understanding of what isnecessary to properly underpin the services that IT is offering to the business. Based on theseobjectives, the relevant services should be identified, designed and transitioned into production,and then subject to continual improvement. ITIL will continue to serve as a source of guidance forprocess and organization design and tool implementation guidance for those responsible fordelivering IT services to draw from.

Overall, we continue to see a tremendous span of adoption and maturity levels. Some organizationsare just embarking on their journey for a variety of reasons, whereas others are well on their wayand pursuing continual improvement, integrating other tool process improvement frameworks, suchas Six Sigma and Lean. In fact, a combination of process guidance from various sources tends todo a better job of addressing requirements than any framework in isolation.

User Advice: ITIL provides guidance on putting IT service management into a strategic context andprovides high-level guidance on reference processes and other factors in the service life cycle. Tooptimize service improvements, IT organizations must first define objectives, and then pragmaticallyleverage ITIL during the design of their own unique processes. ITIL has been widely adopted aroundthe world, with extensive supporting services and technologies. However in India, a show of handsduring a multicity Gartner event in 2011 indicated that ITIL adoption in a large scale is still quite rareamong the IT teams, and in those rare occasions it is primarily focused on linking ITIL initiatives toISO audit and certifications, or using primarily the service operations section.

It is important that ITIL be used as a tool to improve an organization's IT service managementcapabilities and to better integrate with other IT functions, including application development.However, the language of ITIL is probably not that of your business customers, therefore it isrecommended that organizations communicate with customers in a language meaningful to them,rather than relying on a universal knowledge of the ITIL taxonomy.

Infrastructure and operations (I&O) organizations in India should look at ITIL in a holistic andstrategic manner, beyond plain-vanilla operational issues or service desk issues, and should try toleverage ITIL to build strong internal process management capabilities (Gartner's maturity modelITScore for I&O shows process as the least-mature dimension among four I&O dimensions, othersbeing people, technology and business management). ITIL-based process expertise is, in fact, amust-have for organizations that are considering various newer initiatives on cloud and data centerrefresh or transformation.

Business Impact: ITIL provides a framework for the strategy, design, transition, operation andcontinual improvement of IT services, including the organization, processes, technology andmanagement practices which underpin them. If they haven't done so already, IT organizationsdesiring more effective and efficient outcomes should immediately evaluate this framework forapplicability. Most IT organizations need to start or continue the transition from their traditional


technology and asset focus to a focus on services and service outcomes as described in thisframework. IT service management is a critical discipline in achieving that change, and ITIL providesuseful reference guidance for IT management to draw from. Service management professionalsmust also accept that ITIL is not a prescriptive standard and, therefore, precise implementationinstructions are not provided. Every organization is different and so the detailed implementation ofservice management practices will reflect the unique needs of the organization's business and ITenvironment.



Maturity: Adolescent

Recommended Reading: "ITIL 2011 Overview: Evolution, Not Revolution"

"ITIL 2011 Service Strategy: An Important Missing Link Between IT and Business"

"How to Leverage ITIL for Process Improvement"

"Five Ways to Manage IT Service Transitions to Cloud, Leveraging ITIL Processes and ITOM Tools"

"Leverage ITIL 2011 to Build Process Capabilities for Effective Management of Cloud-Based ITServices"

"Use Six Sigma With ITIL 2011 to Improve IT Operations Processes and Effectively Leverage theCloud"

"How to Leverage ITIL 2011 and Avoid Three Common Cost Traps"

"Three Ways IT External Service Providers Can Leverage ITIL 2011 to Cost-Effectively ImproveClient Relationships"

"The Metrics and Measurability of IT Services and ITIL Processes in the Context of the Cloud"

"Top Six Foundational Steps for Overcoming Resistance to ITIL Process Improvement"

"Don't Just Implement CMMI and ITIL: Improve Services"

"Evolving Roles in the IT Organization: The IT Product Manager"

Data Center Bridging in India

Analysis By: Naresh Singh; Joe Skorupa

Definition: Data center bridging (DCB) is the collection of standards proposed by IEEE to makeEthernet more lossless and capable of supporting virtualization. The goal of these specifications isto enable a converged physical network that can efficiently handle multiple data center applications,including storage and high-performance computing.


Position and Adoption Speed Justification: DCB holds out the ultimate promise of networking —a single network to transport all types of traffic, including storage, Internet Protocol (IP) and high-performance compute clustering. DCB is also beneficial to making Internet Small Computer SystemInterface (iSCSI) storage area networks (SANs) more robust, enabling iSCSI SANs to encroach onFibre Channel SANs. Vendors eager to drive revenue from switch replacements and to displacerivals have been espousing the benefits of DCB for more than four years. Unfortunately, standards-compliant and interoperable products may never appear, because nearly every vendor has addedproprietary extensions that severely limit interoperability to a lowest-common-functional subset.

Although vendors in India are already pushing the need for switches that claim to support DCB forunifying the data center networks into a common fabric, not many users feel they need to fullyconverge network infrastructure, particularly storage and IP data networks. Even the early adopterscontinue to be wary of mixing networks that carry different traffic that have clearly dissimilarcharacteristics. More critically, vendors are yet to clearly communicate the full ramifications of DCB.And users are still not aware of its likely impact on and relation to existing network assets. Althoughunification of different networks is one of DCB's primary goals, it is unclear whether multiplemanagement platforms will continue to exist or, if not, how they will work together. Thus, users inIndia are cautious about going for a disruptive technology such as DCB, and they are willing to waituntil there are more proof points of its viability among customers with similar usage situations.

User Advice: Network convergence is more than just a technological issue; it also presentssignificant organizational and operational issues, something that most Indian users are clearly notready to tackle. Before deciding whether to adopt DCB, define clear goals for the effort anddetermine whether it is the best approach. Consider whether a single converged network would bebeneficial, or whether standardizing on a single technology — DCB or an alternative — butmaintaining multiple networks and administrative domains might be a better option. Be wary ofvendors that push customers to commit to "prestandard" versions of these technologies, as thiscould well result in a lack of multivendor interoperability — the very problem that characterizes theFibre Channel world today. When evaluating DCB-based offerings, understand that in all likelihoodthere will be no interoperability in the core, only at the edge. Ensure that the products you selecttoday won't require an expensive, disruptive upgrade in the next two to three years to deliver thepromised meshed, lossless Layer 2 data center core network.

Users in India who do want to test out the technology should observe caution about big promisesmade by vendors and should ask for both proof-of-concept testing and customer references thatare relevant to their verticals.

Business Impact: Standardizing multiple, if not all, data center network requirements on Ethernetwill involve technical complexities and organizational disruptions. DCB will also impactinfrastructure and operations management organizational structures. On the other hand, DCB canhelp enable customers to consolidate their storage network to some extent, thus reducing costsand management overhead.




Maturity: Emerging

Sample Vendors: Brocade; Cisco; HP; IBM; Juniper Networks

Recommended Reading: "Emerging Technology Analysis: Data Center Bridging, Critical but NotYet Ready"

"Myth: A Single FCoE Data Center Network = Fewer Ports, Less Complexity and Lower Costs"

E-Commerce in India

Analysis By: Praveen Sengar

Definition: E-commerce platforms enable B2B and business-to-consumer (B2C) transactions overthe Web. Common e-commerce functions include creation and management of Web storefronts,shopping cart management, taxation, personalization, transaction management, settlement andproduct visualization as well as specialized capabilities like interactive selling, site merchandisingmanagement, order management, product management, customer/account management, searchengine optimization, mobile stores, etc.

Position and Adoption Speed Justification: E-commerce platform deployment is at a nascentstage in India; however, India is one of the fastest growing e-commerce markets in Asia. In India,B2C e-commerce leads the market while B2B is limited to organizations driving online channels tointegrate with their partners and distributors. There are few emerging B2C marketplaces, such asFlipkart, with B2B marketplaces limited to Chinese players such as Alibaba. The e-commercemarket in India is largely dominated by the online travel industry, which has an 80% market share,followed by electronics, financial services, digital products, clothing and fashion, etc.

The major adopters of e-commerce have been organizations specializing in travel, telecom,banking, financial services, insurance, and manufacturing, followed by utilities and retailers. Mobilecommerce is finding traction, with use cases seen in mobile shopping, location based services,digital content consumption and mobile payments.

The market is at a nascent stage as organizations don't have a clear strategy on e-commerce, asmaturity varies widely and penetration of the e-commerce platform is relatively low, with mostsmaller organizations looking to work with marketplace vendors. Most large retailers have notinvested in multichannel commerce and are focused on store expansion and driving foot traffic totheir stores.

Organizations can choose different deployment options for e-commerce such as licensed software,open source software, complete custom development and outsourcing of e-commerce operations.There are multiple factors such as budgets, e-commerce business understanding, skill setsavailable, customization requirements and risk appetites associated with e-commerce business thatinfluence the deployment option. Organizations choose e-commerce platforms based on multiplefactors like viability of vendor, product capabilities, ability to use and ease of implementation.However, the ability to localize and provide industry-specific solutions take precedence over othercriteria.


Limited volume, multiple payment models like cash on delivery, credit card and wire transfer,logistics and fulfillment challenges, higher return rates and low average order value puts pressure onprofitability and viability of B2C e-commerce business. The B2B model is leveraged to driveefficiency in the supply chain and the biggest challenge is getting a partner to invest in IT. Most ofthe B2C marketplace vendors are taking losses and running on negative margins; however, they aretrying to attract volume and gradually drive efficiencies to break even.

User Advice: Few local marketplace vendors, such as Flipkart, are able to drive awareness andvolume for e-commerce business. This opens opportunities as well challenges for selling online, andorganizations should focus on customer segmentation, delivery and customer support to createloyalty to their business.

Organizations should evaluate the product localization capabilities and the ability of vendors todeliver to Indian market requirements. The choice of packaged e-commerce applications is limited(Oracle/ATG, SAP, IBM, Octashop) and very few of them support an outsourcing or software as aservice (SaaS) model in India.

Services vendors such as Infosys and Wipro offer packaged e-commerce solutions for small andmidsize enterprises leveraging their best practices and custom codes shrink-wrapped around an e-commerce vendor's platform.

Organizations should clearly define their e-commerce objective and strategy, understand how e-commerce aligns with other customer points of interaction and gradually drive customers to amultichannel experience. Retailers with brick-and-mortar presence can differentiate by increasingpoints of interaction, gradually driving users to shop online, reserve/buy online, but pick-up and payin store, or vice versa.

Schedule a review of your current e-commerce budget and objectives such as driving sales,customer service or influencing customers, and develop an e-commerce upgrade plan accordingly.

Ensure that site upgrades are integrated into an overall multichannel customer experience coveringsocial and mobile channels, as they are set to grow rapidly over the next two years.

Business Impact: Organizations in India are challenged with expanding their target market to Tier 2and Tier 3 cities, driving multiple touchpoints to improve customer experience and loyalty while atthe same time reducing overall cost of operations. Increasing competition from global players andrapidly growing markets require organizations to leverage e-commerce to expand their market,reduce cost and drive customer experience.



Maturity: Emerging

Sample Vendors: Hybris Software; IBM; Octashop; Oracle-iStore; Oracle ATG; SAP (SAP CRM)


Recommended Reading: "Magic Quadrant for E-Commerce"

"Four Deployment Choices for E-Commerce Globalization"

"An Analytics Framework for E-Commerce Leaders"

"Tap Into the Cloud to Keep Pace With E-Commerce Innovation"

"Cool Vendors in E-Commerce, 2012"

"E-Commerce Has Spread Beyond Retail"

"Predicts 2012: E-Commerce Innovation Demands Speed, Agility and Sharper Order Management"


Analysis By: Cathy Tornbohm

Definition: Business process outsourcing (BPO) is the delegation of one or more IT-intensivebusiness processes to an external provider that, in turn, owns, administrates and manages theselected processes based on defined and measurable performance metrics. Finance andaccounting (F&A) BPO is the outsourcing of any of the following processes to an external provider:accounts payable (AP), accounts receivable (AR), billing, general ledger, tax management, treasury/cash management, management accounting, yield analysis, risk analytics and other F&A tasks.

Position and Adoption Speed Justification: In India, very few companies, especially in thetelecommunications, manufacturing and retail markets, have outsourced their F&A administrationservices. Processes like tax management, AP, billing and AR are starting to be outsourced.However, due to challenging global economic circumstances and continued growth in the domesticIndian market, more providers are targeting the Indian market with F&A BPO services.

User Advice: AP and AR processes run in-house are often not managed efficiently. F&A BPOpresents organizations in the high-growth Indian economy with a possible solution to issues ofscalability, service quality, skills, talent, and acquisition of best-of-breed processes and technologyfor back-office F&A operation and processes. When deciding whether to outsource multiple F&Aprocesses or start with a single process, begin by baselining your capabilities, the size and scope ofthe potential outsourcing deal, and your ability to manage a major deal of scale. Large Indianbusinesses (those with more than $300 million revenue) are more likely to have processing volumethat warrants consideration of a comprehensive F&A BPO, and they should consider making use ofthese local Indian "process factories." Indian organizations should consider outsourcing highlytransactional or clerical processes, such as AP and AR, before deciding on other discrete F&Aprocesses and, especially, before deciding on comprehensive F&A BPO.

Business Impact: The business effect of outsourcing the underlying administration of F&A in thehigh-growth Indian economy can be supportive to organizations, especially because scalability,skills, and acquisition of best-of-breed processes and technology are among the top priorities forF&A BPO buyers. Indian economic growth will also act as a catalyst for organizations to grow theirbusinesses quickly, and outsourcing will serve as an extension to their sourcing strategy in a growth


environment. F&A BPO can save money if the operations had been previously managed inefficientlyin-house or with infusion of best-of-breed processes and technology. In addition, it can provide aCFO with easier access to financial operational levers, such as tighter control of cash-flow-relatedactivities, thereby, freeing senior finance staff to concentrate on strategic endeavors.Comprehensive F&A BPO, although still in its infancy, is expected to gain traction as processintegration and maturity improve.



Maturity: Emerging

Sample Vendors: Bill Junction; EXL; Genpact; HCL Technologies; IBM; Infosys; Serco; TataConsultancy Services; Venture Infotech; Wipro

Recommended Reading: "Cool Vendors in Business Process Services, 2012"

"What's in a Name for Cloud Business Process Outsourcing Services: Explaining BPU and BPaaS"

"User Survey Analysis: Data Supporting the Business Case for BPO"

"Agenda for Business Process Services, 2012"

"Outsourcing Trends, 2011-2012: Evaluate Business Process Outsourcing for Business Advantage"

"Marketing Essentials: Strategic Options for Marketing BPO Process-Enhancing Technologies andServices"

"Marketing Essentials: How to Craft Cloud Business Process Services Messages"

"SWOT: Accenture, Business Process Outsourcing, Worldwide"

"Emerging Service Analysis: Source-to-Pay Business Process Outsourcing"

"Market Trends: Seizing Growth in a Highly Complex Business Process Outsourcing Market"


Analysis By: Amrita Choudhury

Definition: Managed print services (MPS) are services offered by an external provider to optimize ormanage a company's document output. The main components provided are needs assessment,selective or general replacement of hardware, and the service, parts and supplies needed tooperate the new and/or existing hardware (including existing third-party equipment, if required bythe customer). The provider also tracks how the printer, fax, copier and multifunction product (MFP)fleet is being used, the problems and the user's satisfaction.


Position and Adoption Speed Justification: In the last year or so, MPS in India has gained moretraction as organizations kept evaluating avenues to consolidate their print hardware. The economicslowdown has also bolstered the prospects of MPS as pressure on the bottom line has increasinglyforced organizations to look for services that can lower their capital expenditures (capex) andimprove their operating expenditures (opex). Businesses have started seeing the value beyond totalcost of ownership and are focusing on streamlining the print environment. MPS improves inboundand outbound document-related operations, as well as removes an organization's focus onmaintenance of the devices.

IT providers, channel partners and outsourcers are motivated to develop MPS because of the needto add value to their hardware offerings, differentiate themselves beyond the hardware they sell andenhance margin opportunities. Major players have embarked upon the increasing trend and havepushed MPS toward mainstream adoption. These global players have also relied on channelpartners to push their MPS. Owing to the diverse and distributed business environment in India,Gartner expects MPS revenue growth rates to remain in the double digits for the next five years asthe customer base widens and adoption is fueled by newcomers in this marketplace, as well as anincreased customer appetite for the savings and business-process benefits MPS can bring.

New competitors are emerging, such as consumables remanufacturers like Cartridge Junction andABC Copiers, which are positioning as a bundled package of supplies and services. They aremaking small inroads into small or midsize businesses (SMBs) by offering more-competitive costper page than multinational companies.

In general, organizations with 100 or more employees are good candidates for MPS, although largeorganizations are likely to gain more benefits because they have a widely dispersed printingenvironment with big potential for print optimization. Currently, most organizations with more than500 users, across all industries, adopt MPS. Typical adopters in the large segment are serviceproviders in banking, financial services, insurance and IT-enabled services sectors that performlarge numbers of print jobs in a month

The drives: Convergence of digital media has led to exponential growth of the digital content. Thenature of performing transactions is changing, and so is the need for seamless flow of data. MPSproviders create standards and policies for organizations, making IT governance simpler and easyto maintain. Issues related to security, compliance and scale are also addressed and resolved,which improves the perceived value of such services. MPS implementation at this stage isn't oftentied to other goals, such as paper-based business process improvement and alignment of the printstrategy to other IT areas. Also, the growing list of partnerships and acquisitions — such asLexmark's acquisition of Brainware and Xerox's cloud partnership with Cisco — prepares the wayfor MPS to shift toward aligning documents and content with overall business goals. Print providers,system integrators and IT outsourcing firms are aiming high and developing MPS solutions that fitunique requirements.

MPS can deliver clear environmental benefits through reduced paper and energy use. More MPSproviders are developing footprint calculators to address organizations' growing focus on powerconsumption and paper usage. But, more importantly, regulatory requirements are forcingorganizations worldwide to more accurately monitor, track and report their operations'environmental impact. MPS providers are developing capabilities to assess and address


enterprises' carbon footprint. For example, HP has developed software and hardware solutions andservices packaged as EcoSolutions. Increasingly, MFPs with Energy Star ratings are included inMPS contracts. Sustainability aware and environmentally responsible organizations are consideringservices that can help them optimize and streamline their print landscape, reduce waste, streamlinedocument management processes and build an environmentally compliant mashup of hardware,software and systems.

One of the biggest challenges for MPS providers in India is that enterprises, especially SMBs, lookat unrealistic costs, comparing them with small print shops, which, with reconditioned machines,are able to offer print/copy services at half the price of the established global companies. Also, theIndian government does not offer benefits to organizations that invest in or take measures toimprove their eco-friendly quotient and contribute to a sustainable environment.

Despite these obstacles, we believe MPS is gaining traction with organizations; therefore, we areprompted to move its position to peak for 2012.

User Advice: Organizations must pay close attention when choosing the right MPS vendor. Buyersshould expect a more-complex decision with more criteria than required in simply choosing officeprinters and MFPs. Also, they need to involve higher levels of management in the decision (see"Managed Print Services Vendor Selection Criteria").

When considering MPS, businesses need to:

■ Review their buying habits. An organization must consider its current and future size, andoutput needs.

■ Raise senior management's awareness of MPS. The potential investment and changeassociated with MPS are substantial, so businesses need senior management support toensure commitment from the workforce and communication of the benefit.

■ Develop a strategy that includes measuring and tracking output usage, as well as regular reviewof output needs. In many outsourcing agreements, promise of long-term cost reductions can berealized only when continuous process improvement is made a goal of the relationship.

■ If the assessment is done externally, make sure all parties agree on the performance and costmetrics used, so they clearly understand the work to be done.

■ Select a provider based on the service it can wrap around multibranded hardware solutions,rather than around the brands it sells.

■ Analyze print-related workflow and business processes. Digitizing the workflow and reviewingcompany business processes are the stages following an MPS contract.

■ Realize that some channel-led MPS programs might not be suitable. Select a channel partnerbased on the service it can wrap around multibranded hardware solutions, rather than aroundthe brands the company sells.


■ Manage the transition. This is a critical part of the outsourcing relationship. Educate users aboutproductivity features and cost savings to ensure a smooth transition and efficiency of newmachines and services deployed.

Business Impact: Organizations are telling Gartner that, by managing their printer, copier and faxfleets, they saved as much as 10% to 30% in printing costs.

MPS can be a catalyst or critical event for long-overdue change. The MPS market is changing theway organizations purchase and manage their printers, copiers and fax machines. Generally, byopting for MPS, businesses can benefit from simplified budgeting of output costs by consolidatingcontracts for hardware, supplies and maintenance, thereby ensuring businesses greater visibility ofspending. MPS provides the flexibility to scale pages, print resources and cost to match businessvolume and staffing up, as well as down. It has the ability to shift costs to where they have a budgetvia chargeback and turning capex into opex, or vice versa. In addition, leaving the management, aswell as support tasks, to an MPS provider can allow an organization to concentrate on its corebusiness, while freeing IT staff for other purposes. Organizations benefit from the MPS provider'sexpertise in implementing appropriate products, usage policies and processes to meet theirprinting, copying and faxing needs.



Maturity: Emerging

Sample Vendors: ARC; Canon; HCL Infosystems; HP; Konica Minolta; Lexmark; Ricoh; Wipro;Xerox

Recommended Reading: "Marketing Essentials: How to Help Your Print Sales Channel TransitionFrom a Transactional to a Consultative Selling Model and Drive Managed Print Service Sales"

"Marketing Essentials: How to Win Support From Stakeholders Involved in the MPS BuyingDecision"

"Marketing Essentials: Three Considerations for MPS Providers to Enable Long-Term Growth inAsia/Pacific"

"Market Trends: The Next Kind of MPS"

"Market Snapshot: Managed Print Services, 2011"

"Competitive Landscape: Managed Print Services, Worldwide"

"Magic Quadrant for Managed Print Services, Worldwide"

"Toolkit: Managed Print Services Vendor Selection"


Fabric-Based Infrastructure

Analysis By: Aman Munglani; Naveen Mishra

Definition: Fabric-based infrastructure (FBI) is an emerging area of vertical and/or horizontalintegration of hardware and software infrastructure, with automation on top. This technology willassist IT organizations in developing dynamically optimized data centers, which we term real-timeinfrastructure (RTI). FBI differs from fabric-based computing (FBC) by enabling technology elementsto be grouped and packaged in a fabric-enabled environment to achieve a modicum ofinfrastructure convergence.

Position and Adoption Speed Justification: FBI solutions are increasingly being touted byvendors as the logical step to a cloud-based data center using virtualization management tools,where nearly everything is automated, removing significant labor costs from service delivery (see"Clearing the Confusion About Fabric-Based Infrastructure: A Taxonomy"). In making these claims,the vendors hope to change IT buying behavior — i.e., to buy more vertically integratedinfrastructure from fewer vendors. There are two reasons for this:

■ Infrastructure vendors have been under attack by software vendors for years — and are nowunder attack by cloud vendors seeking to paint the hardware as "throwaway" and unimportantto influence IT organizations in moving some of their hardware funds to the software or servicescategory.

■ With server spending constrained, infrastructure vendors need to vertically integrate and createa value proposition that helps them take more of the IT budget to meet the growth and profitobjectives of their shareholders.

Consequently, the early FBI market was driven more from a vendor perspective (versus a customerpull model), as vendors sought to take a larger share of the IT budget to meet their growth goals inan era of constrained IT budgets. However, end-user appetite grew steadily through 2011 and thefirst half of 2012, as users increasingly believe that an FBI approach would help them address the ITmodernization demands of advanced virtualization, leading to cloud computing.

The market adoption for FBI in India continues to be modest. It is primarily being driven by adoptionwithin the manufacturing, IT services and banking segments. Although there are still opportunities,user adoption is marred by concerns about vendor lock-in and perceptions of FBI being expensiveto deploy. Also impeding growth is the fact that long-term users of IT have established and trainedIT skill sets that can integrate and configure solutions in-house and do not need the benefits of apreorchestrated solution. On the flip side, users that do not have an established IT team in place orcannot afford one are looking at FBI for its ease of deployment, time to provision and itsrecoverability benefits.

Many Indian users are still not clear on the benefits of an FBI, and many who do understand are notready for the concept. Early adopters of FBI have found value in the automation of the physicalinfrastructure, enabling them to resize resource pools, automate provisioning with little or no humanintervention, and use policy-based provisioning to run services in varying locations based on theirdata centers and service provider strategies (encoded into the cloud solution).


User Advice: Let vendors tell their stories, narratives and road maps, but only after a specificarchitectural plan has been carefully thought out. Don't take it on faith that a single vendor has thecomplete solution to FBI. FBI is an emerging market, where there are many more vendor promisesthan complete solutions. At the same time, the vendors are selling what IT organizations want —that is, more fully automated infrastructure that reduces labor costs. Make sure that vendors showyou how they will take you there — and what services are required to make necessary ITtransformations or changes to the organization and processes to lead to that vision of FBI. Refer toGartner's published frameworks for evaluating vendors, maturity and cost variables (see "A 14-PointDecision Framework for Evaluating Fabric-Based Infrastructure" and "Introducing the TechnologyDependency Matrix for Fabric-Based Infrastructure").

To achieve the specific benefits of consolidation and cost reduction, FBI typically requires certainvendor hardware and software products. Although IT organizations can build their own FBIapplications, they do so at a significant system engineering and integration cost. IT organizationsthat are early adopters of technology should assess whether FBI could help them achieve theiragility/cost goals, as well as assess whether they prefer to use a specific vendor partner (which islikely to result in greater lock-in with that vendor), or whether they should build their own FBIsoftware using commercial off-the-shelf cloud management platforms linked with underlyinginfrastructure provisioning.

When choosing a specific vendor, secure long-term discounts so that lock-in doesn't result in bigprice increases in during the second through fifth year of use. Use the fabric maturity model (see"An Essential Fabric Maturity Model: Ignore at Your Own Risk") as a guide for placing your ITorganization on an optimum path to success.

Business Impact: The business impact of FBI is operational cost savings — in infrastructureconsolidation and labor savings through the automation of the physical resource layer, as well asimproved agility. Once the foundation is automated, cloud computing can be layered on top foradditional value and benefit. As FBI matures, this will help your cloud solutions work, not only withvirtual resources, but with the physical resources and across many data centers.



Maturity: Emerging

Sample Vendors: Cisco; Dell; Egenera; Fujitsu; Hitachi Data Systems; HP; IBM; Oracle; VCE

Recommended Reading: "An Essential Fabric Maturity Model: Ignore at Your Own Risk"

"Clearing the Confusion About Fabric-Based Infrastructure: A Taxonomy"

"A 14-Point Decision Framework for Evaluating Fabric-Based Infrastructure"

"How to Assess the Impact of Fabric Strategies on Cost and Procurement"

"Fabric Computing: Take Control of Vendor Selection"


"Vendor Alliances Are a Critical Factor in Fabric-Based Infrastructure Selection"

"Introducing the Technology Dependency Matrix for Fabric-Based Infrastructure"

Media Tablets

Analysis By: Vishal Tripathi; Anshul Gupta

Definition: A media tablet is a device based on a touchscreen display, typically multitouch, thatfacilitates content entry via an on-screen keyboard. The device has a screen with a diagonaldimension that is a minimum of five inches. Media tablets feature connectivity via Wi-Fi or via3G/4G cellular networks. Tablets typically offer day-long battery life, and lengthy standby times withinstant-on access from a suspended state. Examples of media tablets are the Apple iPad, SamsungGalaxy Tab, Acer Iconia HCL ME X1, Micromax Funbook, Milagrow TabTop.

Position and Adoption Speed Justification: Media tablets may have open-source operatingsystems, such as Android, under the control of the OS vendor with modifications from the devicemaker, or an open operating system under the control of the OS vendor and/or device maker, suchas Apple's iOS 4 or Windows 8. The OSs offer open programming APIs and developmentenvironments for third-party developers to create applications that can be downloaded from onlinestores, such as the Apple App Store, Google Play and the Amazon Appstore. The media tabletcapabilities for content creation, such as photo and video editing and productivity applications,have improved dramatically in the last year, making the device more practical as a general-purposetool.

Media tablets are slowly gaining some acceptance in the Indian market, where many organizationsare looking to replace notebooks, netbooks or handhelds for automation of their front-end salesforce. Companies are looking to provide these devices to enable live synchronization of data withback-end servers.

Identifying the opportunities, and realizing that India is a very cost-conscious country, manyvendors have introduced tablets that are priced at or below $200. Despite the surge of low-costtablets, they are not really making any considerable impact in the market for the following reasons:

■ Poor screen quality. Most of these vendors are using either resistive screen or a TwistedNematic (TN) capacitive screen and not In-Plane Switching like Apple or Samsung mediatablets.

■ Media tablets need whole ecosystemlike connectivity and customized sets of applications, butwith minimal availability of Wi-Fi spots and high 3G prices in India, this is a challenge. Also,apps offered for these devices are less appealing to consumers in India because few arelocalized or have content related to India.

■ Tablets are perceived as entertainment devices, and these low-cost tablets fail to provide theseamless experience that consumers expect from these devices. People are not sure what theywill do with them as they are not perceived as an alternative to the primary family PC orsmartphone.


■ Unlike as with smartphones, telecom players in India are not bundling media tablets forconsumers, which would definitely help drive sales. Mobile operators also haven't yet launchedmedia tablets with a subsidized hardware cost and offered them to customers in exchange forlonger-term relationships.

The Ministry of Human Resource Development (HRD) announced a prototype for a low-cost $35media tablet. Students tested these tablets and reported overheating, poor build quality, andrandom shutdowns. After much criticism around poor performance and substandard parts,Datawind has now been asked by the Indian government to supply better tablets at the same price.

User Advice:

Media Tablet Vendors

Vendors considering making a low-cost, entry-level tablet for the Indian market should include onlyessential features. They should not, for instance, have onboard storage (for example, no hard-diskdrive or solid-state drive). Instead, storage should be on a memory card inserted through a slot.Tablets should offer multiple options to charge the battery, including a traditional power charger, asolar power charger, and the ability to connect to another device through the USB port. Avoidfocusing too much on hardware features. Consumers have shown that they are more interested ineasy-to-use interfaces and software optimized for the multitouch screen. Vendors should considerlocal companies and startups to design solutions to keep the price competitive.

End Users

Enterprise IT architects should prepare for media tablets to continue to gain traction in theiremployee base as the devices increase in popularity with consumers. In many cases, these deviceshave already entered the enterprise as employees use their own media tablets for work. ITmanagers should apply the managed diversity model for these devices. For tablets with the AndroidOS, select device makers on the strength of their security road maps and adherence to OS updates.Apple iOS 5 has improved security features for the iPad. Windows RT tablets are likely to needdifferent management and security products than future x86-based Windows 8 tablets. IT shoulddecide whether the security features of tablets are sufficient to address the risks associated with thejob roles and app needs of mobile users.

Media tablets will be useful in business-to-consumer applications to deliver high-quality graphiccontent in face-to-face sales situation and/or navigating complex marketing materials. Ultimately,the rate of adoption by businesses will depend on the development of software that increasesproductivity.

Business Impact: Media tablets are presenting a variety of new opportunities for businesses, butthey are also requiring a new set of policies, technologies and skills for the enterprise. Media tabletspresent a variety of new opportunities for business, while supplementing traditional uses ofnotebooks and smartphones. Businesses must evaluate their operating needs and the newbusiness and technology-level selection criteria for the use of media tablets. One way is to positionthese devices in your enterprise's unified communications and collaboration policies and plans.


Media tablets, in conjunction with smartphones and cloud-based services, have the potential tofundamentally change PC use models in the longer term. This impact extends beyond the userinterface to application design and product design, with increased expectations for additionalperformance and a more appealing industrial design aligned with consumer aesthetics.



Maturity: Emerging

Sample Vendors: Acer; Apple; Datawind; HCL Infosystems; Micromax; Samsung

SaaS-Related Professional Services

Analysis By: Frances Karamouzis; Gilbert van der Heiden

Definition: Software as a service (SaaS)-related professional services includes all types ofconsulting, advisory, business analysis, IT architecture analysis, application portfolio and cloudreadiness, configuration, system integration, deployment, application integration services, andtesting services delivered by application service providers to enterprises that are provisioning one ormore SaaS solutions.

Position and Adoption Speed Justification: SaaS adoption has continued with a consistentmomentum of growth over 2011. However, there are a small number of SaaS solutions thatrepresent the largest concentration of SaaS-related professional services. Some examples include:salesforce.com, Workday, Microsoft and Oracle. Despite the small number of SaaS solutions, thecollective spend on these initiatives results in a significant opportunity for professional services asnumerous service providers (large and small) have dedicated personnel for SaaS-relatedprofessional services. However, the service provider interest for SaaS-related professional servicesis not the revenue itself, but rather the strategic involvement in the longer-term initiatives that ensueafter the SaaS solution is configured and is in use. SaaS solutions are often a launching point forlarger IT initiatives within enterprises for end-to-end business process, new channels, new marketsor improvement in existing operations.

The size of SaaS deployments is also growing as several public announcements have shown thatthe number of users is in the thousands. This fuels the justification for more adoption in themarketplace. Whether enterprises want to use SaaS for small targeted use or deployed forthousands of their employees, the implementation of SaaS is not a trivial undertaking. This isprimarily due to the application integration and overall end-to-end view of the business process thatthe software enables rather than a monolithic view of the SaaS solution alone. As a result, moreenterprises are using consultants to ensure effectiveness and efficiency.

Over the next five years, we believe that enterprises will spend $86 billion on SaaS-deliveredsolutions. The continued adoption and velocity of uptake for SaaS-related professional services willbe based on whether these solutions deliver on the promise of better speed-to-market, ease-of-deployment and most of all cost savings.


User Advice: Gartner has published a considerable amount of research regarding applicationservices, application software and the new SaaS offerings which represent the convergence ofsoftware and services. At the most simplistic level, the attractiveness of SaaS offerings is based on:

■ Speed. Access to a solution rather than long drawn out implementations

■ Perceived lower cost. Based on paying for usage to avoid shelfware

■ Budgeting. Operating costs compared to capital

The term "perceived lower cost" was characterized this way because there remains a debate in themarket about whether or not SaaS solutions will bring significant savings. For this reason, Gartnerhas published a model to allow clients to create a comparative analysis for total cost of ownershipfor traditional solutions compared to SaaS solutions (see "Toolkit: Business Case Model for TotalCost of Ownership Analysis of SaaS Versus Traditional Application Software and Services"). Thepurpose of this decision framework is to put this question to the test. The output of Gartner's modelis the examination of whether or not the total cost of sourcing a SaaS solution is a truly lower-costapproach over a 10-year period compared to other options. Hence, Gartner advice is to focus onthe business case and cost assumptions before embarking on the use of a SaaS solution or therelated professional services.

One of the main considerations that sourcing managers and application managers face is how tofactor in all the variables of application software and the IT services needed to enable them. Thisincludes service costs for sourcing, as well as the design, integration, deployment, build andongoing management of the SaaS application. In a SaaS solution, the deployment (design andbuild) takes on a new service delivery model where there is no code modification and only simpleconfiguration changes. However, this does not mean that there is no cost associated with thedesign and configure stage. Although this phase is often faster and less expensive with the stand-alone SaaS solution, it does indeed come with a cost to implement, particularly for the design,architecture, information integration and application integration that allows the SaaS application tointeract with other corporate systems. There are increasingly custom and add-on modulesdeveloped (usually on the same SaaS platform) to extend and complement the SaaS functionality.The deployment of SaaS also has costs associated with the adaptation of workflows and thetraining for users. This can be a higher cost than traditional software solutions since the businessprocesses often change to adopt the workflows and processes dictated by the SaaS solution.Furthermore, in a SaaS solution, some of the ongoing costs (for example, the manage and operateportions of the application) are bundled in the licensing fee. However, this does not mean that theongoing management of the solution is not without IT services spend. Whenever the SaaSapplication has a new release or when other systems are changed, there are costs to maintaininterfaces, information architecture and custom modules that have been developed. Manyprospective buyers often do not factor in these costs. Gartner advises that organizations take arigorous look at all these variables to allow sourcing teams to consider all these costs in theirbusiness cases.

Most SaaS usage in large and midsize companies has so far been of a "bottom up" approach. It hasbeen driven by individuals, small teams or departments that have bought SaaS for their ownimmediate requirements, with little involvement from their own central IT management. These aremost frequently business managers, with little heed paid to the broader issues of enterprisewide


integration, corporate sourcing or governance policy. As corporate IT managers becomeincreasingly aware that this is happening within their businesses, they face a series of challenges inunderstanding how to respond. These range from formulating a policy on approving or forbiddingthe use of SaaS, acquisition where it is approved, best practices in selection and negotiation, andongoing vendor management of technical issues, such as integration and customization. All theseissues are becoming more important — with greater associated upsides and downsides — as thescale of the investment being made in SaaS increases. IT professional services firms are a viablesource of advice and guidance on all these issues and more. Enterprises grappling with thesequestions and that are unsure how to proceed in dealing with them should consider engaging with aSaaS consultant. Enterprises should, however, conduct detailed due diligence of the credibility of aproposed SaaS consulting provider. Given that this is an early-stage market offering, there aresome noticeable differences among consultants regarding the true amount of client work they havedone and the real insights they have into SaaS.

With regard to consultative advisory and system integration services, the long-standing Gartneradvice about making choices (based on alignment to key performance indicators and the use ofbusiness-driven sourcing and management strategies) still prevails. Additional due diligence shouldbe done during the evaluation and selection process, as well as the contracting process, due to therelatively new area of SaaS-related professional services and the incredibly dynamic and fast-growing technological changes being introduced.

Business Impact: For advisory and consultative services, users must be able to gain insights andanalysis about how to harness SaaS solutions to further their strategic use of IT. In the long term,the user can more clearly identify and execute IT architectures that provide added business value orlower costs. The long-term impact of SaaS-related professional services will be significant withregard to them achieving business results and savings levels. In the short term, the service providerlandscape will be quite dynamic given the diversity and volume of SaaS solutions.

SaaS is having a profound effect on the IT industry — upsetting long-established practices andnorms. Also, as it permeates through enterprises, it will have a profound effect on how enterprisesof all types undertake and manage their IT requirements. Its business impact could, therefore, beregarded as highly significant. Consequently, SaaS-related services could also be important andhave a strong impact. SaaS presents enterprises with strategic questions. Should we use SaaS? Ifso, why, where and how do we do that? SaaS also leads to significant tactical questions. What typeof software architecture will deliver the best results? What are acceptable service levels from asupplier? How do we integrate a SaaS application into our existing legacy application landscape?Drawing on the expertise of a SaaS consultant to address these questions will be an increasinglylegitimate and popular course of action. Although the theory of SaaS has posited that SaaS wouldlead to the demise of traditional consultants (who needs consultants when the software is easy touse and can integrate automatically into other software?), the reality is not quite so straightforward.The nature of change that SaaS produces is such that advice and guidance will continue to be avaluable commodity. Consultants, after all, thrive during periods of change.




Maturity: Early mainstream

Sample Vendors: Accenture; Appirio; Astadia; Bluewolf; Capgemini; Deloitte; Fujitsu; IBM; Infosys;Tata Consultancy Services (TCS); Wipro

Recommended Reading: "Options for SaaS Deployment: Profiles of Consulting and SystemIntegration ESPs"

"Toolkit: Business Case Model for Total Cost of Ownership Analysis of SaaS Versus TraditionalApplication Software and Services"

"Software as a Service in the Cloud Services Value Chain"

"How to Evaluate a Vendor's SaaS Delivery"

"Best Practices for Service-Level Agreements for Software as a Service"

"The Impact of Cloud Computing on Sourcing Strategy Models"

"Negotiation and Contracting for Cloud-Enabled Outsourcing"

"Cloud-Enabled Outsourcing: New Ideas for Effective Governance and Management"

"Vendor Management for Cloud-Enabled Outsourcing: Understand the Fundamentals"

"SaaS Dynamics Continue to Act as a Catalyst for the Convergence of Services and Software"

VM Energy Management Tools

Analysis By: Rakesh Kumar; Philip Dawson

Definition: Virtual machine (VM) energy management tools enable users to understand andmeasure the amount of energy that is used by each VM in a physical server. This will enable usersto control operational costs and associate energy consumption with the applications running in aVM.

Position and Adoption Speed Justification: Data center infrastructure management (DCIM) toolsmonitor and model the use of energy across the data center. Server energy management tools trackthe energy consumed by physical servers. Although these tools are critical to show real-timeconsumption of energy by IT and facilities components, the need to measure the energy consumedat the VM level is also important. This will provide more granular management of overall data centerenergy costs and will allow the association of energy across the physical to the virtual environment.As the use of server virtualization increases, this association will become more important, as will bethe ability to associate the energy used by applications running the VM.

Some VM energy management tools come as part of server service consoles, such as HP SystemsInsight Manager (HP SIM) or IBM Systems Director. In this case, users have to rely on the server(vendor)- specific software tools. However, there are hardware-neutral tools, such as VMwareDistributed Power Management, which is designed to throttle down inactive VMs to reduce energy


consumption. Coupled with VMware Distributed Resource Scheduler, it can move workloads atdifferent times of the day to get the most efficient energy consumption for a particular set of VMs.Also, the core parking feature of Microsoft Hyper-V R2 allows minimal use of cores for a givenapplication, even if multiple cores are predefined, keeping the nonessential cores in a suspend stateuntil needed, thus reducing energy costs.

VM energy management tools are at an early stage of development, but should improve during thenext few years. Moreover, uptake of these tools still remains low, as users are unclear about theways in which the products can provide short-term benefit.

User Advice: Acquire energy management tools that report data power and energy consumptionefficiency according to power usage effectiveness (PUE) metrics as a measure of data centerefficiency. The Green Grid's PUE metric is increasingly becoming one of the standard ways tomeasure the energy efficiency of a data center.

Evaluate and deploy VM energy management tools, and develop operational processes to maximizethe relationships among the applications running in VMs and the amount of energy that is used byVMs. For example, VM energy management tools could be used for chargeback or as the basis forapplication prioritization.

Deploy appropriate tools to measure energy consumption in data centers at a granularinfrastructure level. This includes information at the server, rack and overall site levels. Use thisinformation to manage data center capacity, including the floor space layout for new hardware, andto manage costs through virtualization and consolidation programs.

Business Impact: VM energy management tools will provide better management of data centeroperations costs, and more granular energy-based and application-specific chargeback.




Sample Vendors: 1E; Emerson Network Power; HP; IBM; VMware

Recommended Reading: "Pragmatic Guidance on Data Center Energy Issues for the Next 18Months"

"Green Data Centers: Guidance on Using Energy Efficiency Metrics and Tools"

Mobile Over-the-Air Payment

Analysis By: Neha Gupta; Anshul Gupta

Definition: Over-the-air (OTA) payment refers to remote payment, rather than to proximity-basedpayment using technologies such as Near Field Communication (NFC). OTA payment often usesShort Message Service (SMS), unstructured supplementary service data (USSD), Wireless


Application Protocol or downloadable clients. Gartner defines mobile payment as transactionsconducted using a mobile phone and payment facilities, such as bank accounts, bank cards orprepaid accounts.

Position and Adoption Speed Justification: Mobile OTA payment can be used for moneytransfers, bill payments and merchandise purchases, for example. In India, mobile account top-upsand bill payments are the top two use cases. We expect the growth rate for this service to continueduring the next two years and, in the long term, there is great potential for money transfer servicesto develop in India.

Mobile money transfers are an important financial device for the large "unbanked" and"underbanked" population in India, given the low proliferation of other payment systems like creditcards. The large gap between the penetration levels of mobile and banking services makes mobilemoney transfers even more attractive.

There are three ways in which mobile money transfers will operate:

■ Mobile service provider payments. The Reserve Bank of India (RBI) has permitted Indianmobile service providers to launch a semi-closed system of prepaid devices for mobile users tobuy and redeem within a group of clearly identified merchants in locations and establishmentsunder contract with mobile service providers. These tools do not permit cash withdrawal orredemption by the user. Airtel, for example, offers a service called Airtel Money that allowscustomers to make cashless payments using their mobile phones. The maximum value of thistype of prepaid, semi-closed mobile wallet is 50,000 rupees.

■ Bank payments on mobiles. These are banking transactions, such as deposits, withdrawals,and person-to-business, person-to-person and business-to-business payments. Only thosebanks permitted to offer mobile banking transactions by the RBI can launch mobile-basedprepaid payment devices (for example, mobile wallets and mobile accounts). Most mobileoperators like Bharti Airtel and Vodafone have joined up with SBI and ICICI Bank, respectively,to offer such facilities to their subscribers. The semi-closed mobile wallet service means thatmoney can be loaded onto mobile phones from a licensed company and then used to makepayments, but cannot be used to withdraw cash.

■ Non-bank payments on mobiles. As mentioned earlier, the RBI requires a bank account to beset up before using mobile for banking transactions. This presents opportunities forindependent service providers to try and bridge the gap between banks and mobile carriers.Mobile payment applications such as Obopay, Paymate and ngpay are available. Obopay letsconsumers and businesses purchase, pay and transfer money through any mobile phone. Thiscan be done using Obopay's mobile application, text messaging or phone Web browser. InIndia, Obopay has partnered with Grameen Solutions, Aircel, Loop Mobile, Tata Indicom andYes Bank.

Online shopping has recently seen a considerable upturn in India. Various services from e-commerce providers, banks, mobile operators and alternative payment providers (such as PayPal)will help increase mobile services uptake. Firms and merchants such as Cleartrip and Indiatimes,and group buying companies like snapdeal.com, have deployed mobile sites and applications to


drive mobile commerce. Users can order goods and check them out on their phones usingestablished payment profiles.

Given the regulatory environment, mobile payment services in India are likely to start with thebanked population, but will benefit the unbanked as regulations are relaxed in the future.

While India is taking small steps to provide more convenience to its mobile population in terms ofease of payments, a few hurdles remain:

■ Regulation is still very strict about providers of this service and the use of mobile wallets:

■ Currently, services are semi-closed and we do not know when they will be fully open.

■ Users need to register for a bank account by providing a full set of ID documents, which couldbe difficult for the unbanked.

■ Semi-closed wallets limit the appeal to the unbanked, since cash flow (money inwards andoutwards) is a very important feature for these users.

■ Limited service coverage means that service providers need to build the extensive distributionnetwork for effective cash flow, as well as relationships with merchant networks to acceptmobile payments for their goods. Currently, these developments are at a very early stage and itwill take years for them to build out the network — and might take even longer in rural markets.

■ Mobile phones have their limitations and Gartner's view is that SMS and USSD are technologiesthat will reach a wider audience, rather than client or browser-based examples. Code divisionmultiple access (CDMA) carriers cannot use subscriber identity module toolkits or USSD, whichfurther restricts their options. The mobile commerce examples seem to work for more advancedphones with browsers or downloadable apps and for banked people that can use their creditcard for payment, rather than for rural and unbanked people.

■ Users don't perceive mobile payments to be completely secure.

User Advice: Banks should evaluate the potential of using mobile OTA payment to reach theunbanked and underbanked sectors. They should also talk with mobile carriers about how todevelop a profitable business model. The per-user revenue strategy for these applications may belower, but the costs of serving these populations are also lowered by using the mobile channel.Considering the huge population involved, the revenue potential is realistic.

Mobile carriers, given their advantage in terms of mobile services and brand influence in developingmarkets, should look into the service, as it provides a new revenue stream and can reduce churn.

Business Impact: Mobile carriers can expect to see increased revenue and reduced churn frommobile OTA payment. Banks have the potential to reach more users, include them within themainstream banking infrastructure and then, once they are more familiar with financial products,upsell credit products.





Sample Vendors: Comviva; Gemalto; mChek; Obopay; Paymate; Sybase

Recommended Reading: "Forecast: Mobile Payments, Worldwide, 2009-2016"

"Market Trends: Mobile Payment, Worldwide, 2012"

"New Barclays Mobile Payment App May Upset Bank/Telco Status Quo"

Solar Energy Technology


Definition: Solar energy technology involves the use of thermal solar energy for electricitygeneration and water heating. Solar photovoltaic (PV) technology refers to the method of harnessingsolar energy for direct electricity generation through the use of semiconductors. As the process ofsolar power generation involves only the absorption of light energy, as opposed to the burning offuel in order to generate electricity, there is virtually zero emission of harmful greenhouse gases intothe earth's atmosphere during the generation of electricity.

Position and Adoption Speed Justification: The growing demand for electricity in India, coupledwith increasing energy prices, is driving alternative renewable energy sources such as solar andwind. India receives a large amount of solar energy due to its location and size. This is driving therapid adoption of solar energy technology in India. The Indian government has set a target toachieve solar energy installed capacity of 20 gigawatts (GW) by 2020 from the current installedcapacity of 200 megawatts (MW) as per the Jawaharlal Nehru Solar Mission. With the installedcapacity for solar PV cell/module production expected to grow in the coming years, we believe solarenergy technology adoption will grow strongly as well. Although many vendors setting up PVmodule manufacturing facilities in India are targeting mainly the export market in Germany, playerslike Moser Baer, Tata BP Solar, Solar Semiconductor, XL Telecom & Energy and others are nowincreasingly focusing on the domestic Indian market. We believe that by 2013, nearly 40% of India'ssolar PV production will cater to the domestic market.

Gartner believes that the three-phased plan, announced by the government of India — which hopesto generate 1 GW to 1.5 GW of solar power by 2012; 6 GW to 7 GW by 2017; and the rest by 2020— will create new domestic opportunities for solar PV cell/module manufacturers in India. However,the biggest concern that remains is how the government will secure the necessary funding requiredto kick off projects to meet the installed-base target. Moreover, the unreliability of the existingelectric grid in India is a critical issue that will limit the adoption of solar and other renewable energygeneration technologies over the next five years, perhaps longer if not fixed. Reliable grid powerand energy storage capacity will be needed to enable renewable energy generation in India.

Despite these concerns, in April 2012 the state government of Gujarat commissioned a 600 MWsolar power plant spread across nearly 3,000 acres. Also, during April 2012 in Gujarat, a few othersmaller capacity solar power plants have been commissioned by private players such as EMCO (5


MW) and Integrated Coal Mining (ICML) (9 MW). The state government of Gujarat has also unveiledthe rooftop solar power generation scheme, under which the state plans to generate 5 MW of solarpower by putting up solar panels on about 50 state government buildings and on 500 privatebuildings. Gujarat plans to emulate this project in Rajkot, Surat, Bhavnagar and Vadodara over thenext two years. In a novel initiative, the state government also plans to generate solar power byputting solar panels on the Narmada canal branches. As part of this scheme, the state hascommissioned a 1 MW solar plant on the Narmada canal. This has helped stop 90,000 liters ofwater from the Narmada river from evaporating. With more new projects in the pipeline, Gujaratcontributes 66% of the country's total solar power generation. Although the state already has apower surplus, it has allocated a budget of $40 million for further developments in renewableenergy.

Besides Gujarat, during the first week of May 2012, Reliance Power commissioned another 40 MWsolar power plant spread across 350 acres in the state of Rajasthan. Other state governments suchas Tamil Nadu and Karnataka are also expected to commission projects by the end of 2012. Giventhese recent developments, we have therefore moved solar energy technology up the curve andpast the Peak of Inflated Expectations on the Hype Cycle in the 2012 update.

User Advice: Global solar PV vendors should explore joint venture opportunities with local playersthat already have a presence in the domestic market. This will enable them to penetrate the marketfaster and capture market share early. Vendors considering going it alone in the Indian marketshould not only understand the power generation, distribution and power purchase agreementstructure in practice in India, but will also need to understand the local market needs in terms of keysolar applications that are in demand in both rural and urban areas.

Business Impact: Solar energy is an area of great interest and opportunity for enterprises wishingto use clean, sustainable energy sources and for technology providers looking to commercializenew business models and technologies for solar energy. Growing demand for clean energy in Indiais coming at a time when the country is facing an acute shortage of thermal energy to meet itsgrowing energy demand, spurred by the rapid economic growth of the last few years. Solar PVtechnology has the potential to reduce reliance on fossil fuels to meet India's growing energyrequirements. Besides providing new revenue earning opportunities, the technology also has thepotential to attract new manufacturing investments into the country and enable the growth ofvarious solar applications, such as building-integrated PV applications with semitransparent glasspanels for windows and skylights, solar water heaters, solar cookers, solar street lamps and so on.



Maturity: Emerging

Sample Vendors: Moser Baer; Reliance Power; Solar Semiconductor; SunEdison; Tata BP Solar

Recommended Reading: "Hype Cycle for Solar Energy, 2010"

"Dataquest Insight: India Encourages Foreign Investment in Its Solar Photovoltaic Market"


"Predicts 2010: Photovoltaic Solar Energy Industry Transitions to New Growth Phase"

KPO

Analysis By: Frances Karamouzis

Definition: Knowledge process outsourcing (KPO) is a term that has emerged to distinguish aspecific type of BPO that involves highly skilled professional services focused on businessprocesses that provide competitive advantage. Hence, KPO requires specialized knowledge orexpertise for analytical, industry domain expertise. KPO offerings often include knowledge works,specific assets in the form of intellectual property, and methodologies, tools, process acceleratorsand business process approaches designed to drive differentiated business value.

Position and Adoption Speed Justification: The KPO market is made up of a large array ofindustry-specific services (e.g., banking, insurance, pharmaceuticals, and clinical trial and legalprocesses) and business-process-specific services (e.g., marketing, analytics, CRM and supplychain management), different types of KPO are maturing at different rates. The fragmented nature ofthe different types of KPO serves to diffuse the overall KPO category of service. Industries that arespending the most on business intelligence and analytics and big-data-driven initiatives are clearlydemonstrating more aggressive buying patterns of knowledge process services. These industriesinclude financial services, life sciences, consumer packaged goods and retailers. Based on clientinquiries and informal polling of both buyers and sellers, Gartner estimates that knowledge processservices have been adopted by approximately 10% to 20% of end users. Gartner expects that theoverall category of KPO services will start to experience a sharper increase in adoption versus thelast five years as the movement for analytics and big data is starting to approach a fever pitch.Many of the efforts to deliver decision-driven analytics necessitate knowledge workers with deepindustry expertise. The connection between big data and KPO is premised on the fact thatprocessing large volumes or wide varieties of data remains merely a technology solution unless it istied to business goals and objectives. This happens through knowledge process workers andoverall KPO initiatives. Although the term "big data" overemphasizes the issue of informationvolume, the practical reality is that it's not about the volume, it's about business value derived byknowing the customer or prospect, making connections and identifying patterns, and finally,creating customer intimacy. KPO will see a slightly staggered but highly correlated adoption behindthe technology vendor growth in the big data category. Currently, technology vendors are investingin solving the technical challenges with volumes of data as well as issues such as velocity of data,variety of data formats, complexity of data types, data challenges (i.e., real-time data, shared data,linked data and high fidelity data). As these issues are attacked and technology adoption continues,organizations will quickly follow with the search for highly talented knowledge workers to deliver onbusiness value. After this growth spurt in KPO, the next big trigger for growth will be the alignmentbetween IT and operational technologies (OTs). Gartner has published a significant amount ofresearch on the growth of OTs, with a central theme that OT is the epicenter of differentiated valuefor any enterprise. Hence, KPO services will provide the most payback and growth as the scope ofthe work shifts to operational areas of the business.

User Advice: The term "KPO" is used as a collective noun for individual industries' outsourcinganalytics and IP-related processes. Therein lies the biggest risk for enterprise buyers — namely, thetrue level of depth in process and industry knowledge of the service provider in the specific


subsegment. The confusion surrounding what constitutes KPO services will continue for some timeas more services are devised to make use of well-educated, lower-cost labor and processingspecialists. Rarely does one provider of KPO offer all the many types of KPO for sale, although thetrend is to increase the number of KPO services that could be sold. And that brings up the second-biggest risk for the enterprise buyer — namely, how to properly evaluate and select a KPO provider.In this phase of the sourcing life cycle, one of the early starting points is conducting a market scanof potential providers. In KPO, this initial market scan is difficult because KPO services are beingdelivered by four types of suppliers:

■ Specialist KPO providers that have emerged during the past 10 years to offer single or multipletypes of these services

■ BPO providers that have expanded into these types of KPO services

■ Consulting firms of all types that have put forth offerings related to designing and buildingdecision support solutions

■ Dedicated industry specialists that specialize in, for example, clinical trials or market research

Within the overall KPO market, the service offerings in each industry segment continue to evolveand take shape. Therefore, enterprise buyers require a high level of due diligence when purchasingthese services to ensure that the services will deliver on the value proposition. Some of the coretechnology tools and foundational skills tend to be horizontal. However, based on our distinguishingcharacteristics above, until a critical mass of knowledge workers, coupled with deep IP, isestablished with expertise in a targeted business process or function, the specific offering from anyservice provider will be considered embryonic KPO.

The difficulty for clients and service provider relationships has been to define appropriate ways tomeasure benefits, productivity and value-add. As such, many deals still resort to rate cardcomparisons and skill assessments. Furthermore, enterprises struggle to identify and compareselective KPO providers because many of the specialties are niche areas. At the moment, there is alarge fragmented array of niche service providers, coupled with large providers of other BPOservices, looking to extend their offerings into areas of KPO.

Buyers should proceed with caution: Focus on a phased, multiyear journey, and expect higherlevels of vendor management and governance requirements. KPO remains in the early stages of theservice life cycle, and there are limited numbers of vendors with extensive critical mass in a givenindustry subsegment. Gartner research shows that, when a service category is in its infancy, theservice levels are usually at their lowest, and risk is at the highest point in the cycle.

Gartner recommends that enterprises invest in understanding and decoupling their businessprocesses to determine the specific opportunities for value. The benefits can be achieved in severalways: KPO assures enterprises that their operational processes are being executed for competitiveadvantage, and KPO offers enterprises external expertise, insight, best practices and process.

In banking, for example, being able to decouple processes (or parts of processes) and adding KPOfor analytics, revenue modeling or profitability analysis can be a significant advantage. This hasbeen applied to such areas as loan modification, where advanced analytics are needed to improve


outcomes and avoid making the situation worse (more repossessions or lower profitability). UsingKPO for a discrete part of a process chain can add value; however, it must remain possible to keepit integrated with overarching capabilities, such as business activity monitoring, workflow andorchestration. Don't let it become a "black box," where only the inputs and outputs are known. Thiswill compromise auditability and transparency, which will be damaging in the new financial servicesmarket.

Business Impact: Depending on the targeted business process and offering — including people,methodology and IP — the option can be transformational in reducing costs and formalizing waysof working in professional services, such as legal support. The effects on business are therethinking and redistribution of subprocesses across disparate locations based on a combination ofrisk, security, cost and competency (including business, language and technical skills), resulting incompletely new modes and delivery costs.




Sample Vendors: Accenture; AIMIA; Evalueserve; Experian; Genpact; Hexaware; IBM; InfosysTechnologies; Mu Sigma; Sutherland Global Services; Tata Consultancy Services; Wipro; WPP

Recommended Reading: "Outsourcing Advisory: Sourcing Strategy Options and Approaches forBusiness Process Services"

"'Big Data' Is Only the Beginning of Extreme Information Management"

"Big Data Means Big Changes for Business Intelligence"

"Cool Vendors in Analytics and Business Intelligence, 2012"

Sliding Into the Trough

Cloud Computing

Analysis By: Aman Munglani; Sid Deshpande

Definition: Gartner defines cloud computing as a style of computing in which scalable and elasticIT-enabled capabilities are delivered as a service using Internet technologies.

Position and Adoption Speed Justification: Cloud computing is still a highly visible and hypedterm, but has clearly passed the Peak of Inflated Expectations. There are signs of fatigue, rampantcloudwashing (marketing more traditional hosting offerings as cloud infrastructure as a service), andof disillusionment (e.g., highly visible failures). While cloud computing is approaching the Trough ofDisillusionment, it remains as a major force in IT. Users are changing their buying behaviors.Although it's unlikely they'll completely abandon on-premises models or soon buy complex,


mission-critical processes as services through the cloud, there is movement toward consumingservices in a more cost-effective way, and toward enabling capabilities not easily done elsewhere.

Every IT vendor has a cloud strategy, although many aren't cloud-centric. This is particularly true forIndia, where enterprise IT buying centers often turn to their IT services providers as the primarysource of advice on new technology areas such as the cloud. IT service vendors in India are bold intheir cloudwashing attempts, claiming to offer public cloud services when what they offer is a formof utility hosting, or hosted private clouds. Enterprise users in India are just beginning to see thatsourcing metrics, total cost of ownership (TCO) analysis and provider evaluation parameters varysignificantly, depending on the type of cloud deployment being considered. Variations, such asprivate cloud computing and hybrid approaches, compound the hype, and demonstrate that onedot on a Hype Cycle cannot adequately represent all that is cloud computing.

User Advice: User organizations must demand road maps for the cloud from their vendors. Usersshould look at specific usage scenarios and workloads, map their view of the cloud to that ofpotential providers, and focus more on specifics than on general cloud ideas.

User organizations in India should align their cloud computing definitions and service levels withaccepted, independent industry benchmarks, and should ask infrastructure and service suppliers tomap their service offerings to that alignment, rather than allowing providers to cloudwash theirofferings.

Vendor organizations must focus their cloud strategies on more specific scenarios, and should unifythem into high-level messages that encompass the breadth of their offerings.

Cloud computing involves many components and services, some of which are immature. Make sureto assess technology maturity and the risks of deployment. Cloud services brokerages can helpwith these efforts.

Business Impact: The cloud computing model is changing how the IT industry looks at user andvendor relationships. As service provisioning (a critical aspect of cloud computing) grows, vendorsmust become service providers, or partner with service providers to deliver technologies indirectlyto users. User organizations will see portfolios of owned technologies decline as service portfoliosgrow. The key is to determine which cloud services will be viable, and when.

Benefit Rating: Transformational


Maturity: Emerging

Sample Vendors: Amazon; Google; Microsoft; Netmagic; salesforce.com; Tata Communications;VMware

Recommended Reading: "The What, Why and When of Cloud Computing"


Mobile Application Stores

Analysis By: Anshul Gupta; Neha Gupta

Definition: Application stores offer application discovery and download functionality to mobiledevice users, either through a local storefront client or the browser. Public stores provideapplication categories such as games, travel, productivity, entertainment, books, utilities, education,travel and search, and rating and comment mechanisms. Private application stores are madeavailable through management products or cloud services, and help organizations deployapplications to mobile workers. Applications are free, charged for, or funded by ads.

Position and Adoption Speed Justification: Mobile application stores are targeted at smartphoneusers, mostly for applications such as games, books, education, health and fitness, social andmusic. Application stores have been behind the success of smartphones as they have helpedincrease smartphone utility and the user experience. In India, smartphone penetration is low as itcontributes only 7% to 8% of total device sales. The increasing availability of affordable, low-costsmartphones has increased the number of devices capable of supporting applications, leadingcommunications service providers (CSPs) to offer applications as part of their efforts to arrestchurn.

Application stores are also available in India as feature phones have a large overall installed baseand continue to have high demand. In India, Nokia Store is the most used application store. This isdue to the large installed base of Nokia's Symbian devices and the fact that the store offers appsfor smartphones and feature phones. Google's Android Market is the other application storeattracting higher downloads, due to the rising penetration of Android devices. Other branded storesfrom large global players — such as App World from Research In Motion and App Store from Apple— have seen increasing interest from the consumers.

CSPs in India have also introduced their own branded application stores; for example, thePocketApps Store by Aircel, Airtel App Central by Airtel, Vodafone App Store from Vodafone,Ericsson eStore by Idea Cellular in partnership with Ericsson, and Reliance App World (which is alsobased on eStore). These are targeted at mass-market feature phone devices (including smartdevices or open OS phones), but consumer adoption is slow due to limited awareness, high dataplan charges and users' lack of awareness about the benefits or entertainment that applicationsbring. However, consumer preferences are slowly changing as urban subscribers have begun usingapplications related to mobile email, m-commerce and location-based services. Carriers arepromoting application stores heavily with affordable tariffs to retain customers and increase revenueopportunities.

User Advice: Application providers and developers should look for application stores that areassociated with popular handsets and that can create a good user experience, and should weighthat against the difficulty of developing and porting applications and the potential popularity of anapplication. It is also important to choose application stores that have good distribution in terms ofoutlets and services from the application development community. Other features of applicationstores that would benefit developers include advertisement support (like the Google model, to allowvendors to be "top of deck"), user reviews, rankings and recommendations (as with Amazon.com),and good billing and reporting features.


CSPs need to increase their selection of applications and fight for good discoverability on devices incomparison with competing stores. One option is that CSPs should work with third-partyaggregators of apps to ensure that stores have a good number of applications within them toappeal to local tastes. Important components of these stores are ease of search, discovery anddownloadability. CSPs can also use their billing functionality to facilitate payments, locationinformation to enhance applications, and customer insights to improve advertising inside theapplications. Being on a CSP deck can be an advantage to a third-party application store, becausethis is still a strong channel.

Application stores are a "scale game," and those offering them need to create some unique sellingpoints that will bring developers to their stores, rather than those of their competitors. Anecosystem needs to be created in which:

■ Developers have the tools to easily write and port applications

■ Individuals can easily access, download and use applications

■ All sides have visibility into the accounting of application sales and an efficient billing systemthat allows everyone to get paid in a timely manner

The lack of availability of Wi-Fi hot spots, or even Wi-Fi-supported broadband connections at home,is another challenge for the adoption of applications on mobile devices. This is because users mayavoid using mobile networks to download applications due to high cost issues. India is a prepaid,voice-dominated market and data usage on devices is low due to the comparatively high costsassociated with it. However, recent CSP initiatives to offer affordable data plans — on per-daybilling and per-hour billing — will entice users to try data services. Some manufacturers have eventied-up with CSPs to offer free applications for a limited period upon device purchase — to enhancethe user experience on mobile devices and to fuel the adoption of application stores.

Business Impact: Mobile application stores are likely to have an impact on:

■ Applications providers. There are several value-added service vendors in India, such asComviva and OnMobile, that can form third-party alliances with CSPs to gain access toadditional customers in a well-organized ecosystem. They can also partner with devicemanufacturers to offer differentiated content that is preloaded onto a device.

■ Brands. These can advertise and segment customers based on applications.

Applications are maturing beyond the traditional ringtones and games. They are now used as aplatform to promote relevant products and services to induce consumers to buy — depending ontheir preferences — with the help of context-aware technology.

The biggest issue for any party wishing to provide an application store is that it is unlikely to behighly profitable, given the current market prices and the necessary startup costs.





Sample Vendors: Apple; Comviva; Google; Nokia; OnMobile


Analysis By: Biswajeet Mahapatra

Definition: Business service management (BSM) tools leverage a real-time IT service model todynamically link availability and performance events from underlying IT infrastructure andapplication components to business-oriented IT services that enable business processes. The goalsare to determine the business impact of the events and analyze the root cause of the issues.Results are displayed in graphical business service views, sometimes referred to as dashboards.

Position and Adoption Speed Justification: Every company wants to assess the impact of the ITinfrastructure and applications on its business processes to match IT to business needs. However,only 10% of large companies have developed their IT operational processes to the point wherethey're ready to successfully deploy a BSM tool to achieve this. IT organizations need to be able toidentify business-oriented IT services and document and maintain the IT service model of parent-child relationships and other associations between those services and their supporting ITinfrastructure components. Monitoring tools, such as event correlation and analysis (ECA),application performance monitoring (APM) and, in some cases, job scheduling, must already bedeployed to feed their results to the BSM tool. Potentially complex service health calculations,weightings and dependencies need to be defined, rather than relying on straightforward inheritanceof status from the multiple applications and IT infrastructure components that make up a businessservice.

Adoption speed will continue to be slow but steady, as IT organizations improve their ITScorematurity level. BSM is starting to slide toward the Trough of Disillusionment. IT organizations arediscovering that BSM tools aren't easy to deploy, because the tasks of identifying and maintainingthe IT service relationships and dependencies are either a major manual effort or require an ITservice view configuration management database (CMDB) be in place, which is not the case in mostcompanies.

In India, service providers have done a good job implementing BSM tools, but for the most part,these tools have not been deployed at the enterprise level. The high cost of tools and the lowerinvestments in process improvement initiatives are some of the reasons for lower adoption in India.

Large enterprises have implemented BSM tools in patches with some open source and someproprietary tools implemented on an ad hoc basis. Integrations among the tools and variouscomponents like configuration management and CMDB is not so common. Event correlation andAPM is the strongest in large enterprises, with most of the users using these features in IToperations management (ITOM) tools extensively.

User Advice: Clients should choose BSM tools when they need to present real-time, business-oriented dashboard displays of service status, but only if they already have a mature, service-oriented IT organization. BSM requires that users understand the logical links between IT


components and the IT services they enable, as well as have good instrumentation for andmonitoring of these components.

Clients should not implement BSM to monitor individual IT infrastructure components or technologydomains. At its core, BSM provides the capability to manage technology as a business service,rather than as individual IT silos. Thus, BSM should be used when IT organizations try to becomemore business-oriented in their IT service quality monitoring and reporting.

In India, it is also important that clients deploy robust and integrated service managementprocesses before looking at deploying BSM tools. Process adoptions have been very low, as mostof the BSM tool implementations have gone horribly wrong in the past.

Business Impact: BSM tools help the IT organization present its business-unit customers with abusiness-oriented display of how well IT services are performing in support of critical processes.BSM tools identify the IT services affected by IT component problems, helping to expedite incidentmanagement and also to prioritize operational tasks and support efforts relative to business impact.By following the visual representation of the dependencies, from IT services to businessapplications and IT infrastructure components (including servers, storage, networks, middlewareand databases), BSM tools can also help the IT department determine the root causes of serviceproblems, thus shortening mean time to repair, especially for critical business processes.




Sample Vendors: BMC Software; CA Technologies; Compuware; eMite; HP; IBM Tivoli; InterlinkSoftware; Neebula; NetIQ; Tango/04

Recommended Reading: "Cool Vendors in IT Operations Management, 2012"

"Magic Quadrant for Application Performance Monitoring"

"Market Definition: Availability and Performance Monitoring"

"Characteristics of IT Asset Management Maturity"

Mobile Advertising

Analysis By: Neha Gupta; Anshul Gupta

Definition: Mobile advertising is a paid placement on mobile device screens, most notablysmartphones and media tablets. Mobile ad formats include search, Web, app, stream andmessage-based placements.

Position and Adoption Speed Justification: Mobile advertising encompasses a number offormats:


■ Mobile Web banners and display ads (including rich media).

■ Mobile in-application ads.

■ Mobile search and map-based ads.

■ Mobile in-stream video and audio ads.

■ Mobile display ads affixed to SMS or Multimedia Messaging Service (MMS) messages.

Mobile ads may be acquired through ad networks acting as aggregators or directly from mobilepublishers or mobile app developers. Ad networks may operate as stand-alone businesses or theymay be affiliated with mobile communications service providers (CSPs) or software providers thatpartner with manufacturers to provide mobile open operating system platforms. For the purposes ofour India-specific research, we also include SMS, MMS and mobile couponing in our definitionbecause we believe that the Indian industry will rely on these instruments heavily in the midterm,mainly until the penetration of smartphones picks up.

For small entrepreneurs mobile advertising has become the primary channel for reaching the massmarket. Three main reasons for this have been a high mobile penetration, healthy rate of growth ofmobile Internet users and the low cost of interaction and transactions in this medium compared toTV, print or radio. Big brands in India are using mobile marketing mainly to offer their brandexperience across another touchpoint. So far, growth has come mostly from high-volume, low-costtext- and banner-oriented SMS/MMS campaigns and this trend is expected to continue in the nearterm. The low-cost of reach has helped its growth tremendously. Costing structures vary dependingon whether marketers send messages to consumers, or vice versa, or both. The cost to the client iscurrently less than $0.01 per customer depending on numerous variables such as whether anagency was involved in the strategic and creative process; carrier and third-party data costs; andthe overall complexity of the campaign. So far, the two most successful forms of SMS marketinginvolve digital coupons and time- or event-based messages which usually involve other forms ofmedia and an intuitive process for consumers who opt in voluntarily.

The uptake of mobile advertising in India has been significant even as it remains a nascent marketand lags behind the more developed ones. That the industry is still maturing can be seen in the factthat it is only a $20 million market. It is, however, expected to double every year in the next coupleof years. The drivers behind this growth will be greater penetration of smartphones combined withthe introduction of more affordable mobile data plans. The market is already evolving from a stagewhere mobile Internet was being used for email access only, to being used for social mediaconsumption and various kinds of content from news to sports to games. This trend is expected toaccelerate due to better connectivity with the launch of 3G services and wider availability of Wi-Fihot spots. Increased usage of Internet in mobile also implies that advertisers have more avenues tochoose from. Five years ago, though there was excitement about mobile being an advertisingmedium, there were not as many opportunities as there are now.

A big obstacle to creating a successful mobile ad is the lack of correct profiling of individuals, sopromotions often come off as spam which has caused discontent among users. To address thisissue the telecom regulatory body of India has forbidden advertisers to approach mobile users ifthey are registered in the "do not call/do not SMS" category. In the coming years, mobile service


providers are expected to play an important role in making mobile ads more personal so that usersdo not treat them as spam.

For advertisers and retailers the promise of location-based advertising is also enticing and hasachieved some positive results. The industry is also adopting display advertising which, unlike SMSadvertising, is non-intrusive. As the penetration of smartphones rises high-end, application-orientedbrand advertising will start to appear as is the case in developed markets now. Despite thesepositive signs some significant challenges do remain. For example, formats and standards are notstandardized and metrics (considered by many advertisers and agencies to be a baselinerequirement for any major media investment) remain hampered by technical and organizationalcomplexities. Privacy and targeting is the other big issue. Although mobile devices contain a wealthof targeting data, privacy concerns have blocked significant uptake of these capabilities.

In summary, although many fundamental issues remain to be resolved, Gartner expects overallstrong growth rates for mobile advertising in India over the midterm.

User Advice: Marketers considering mobile advertising must evaluate a number of variables todetermine how best to reach their target audience.

In India, SMS will remain a good way to distribute marketing messages to mass audiences and mayprovide enough economic value to subsidize the expansion of access to more advanced handsetsand service plans.

Brands and agencies must develop methods of evaluating the effectiveness of mobile campaignsacross various mobile channels to optimize the use of mobile media in the marketing mix. This islikely to vary considerably by product category, audience profile and region. In particular, brandsand agencies must consider ways to use mobile channels as a response mechanism in concert withother non-interactive formats, such as print and TV, and not only as a stand-alone channel.

Advertisers and agencies must continue to refine privacy policies and practices to address new andpotentially controversial targeting capabilities of mobile devices which has come under theregulator's scanner in recent years.

Content providers, developers and publishers need to understand how to incorporate elementssuch as social features, maps and video into applications that will attract both users andadvertisers.

CSPs and manufacturers need to be decisive about their intended roles in mobile advertising andacknowledge that, with few exceptions, success will require both strong partnerships and strategicacquisitions to quickly establish key roles in end-to-end solutions that can deliver efficiency andscale to advertisers.

Business Impact: Mobile advertising is expected to increase with a compound annual growth rateof over 50%, to reach a turnover of $55 million in the next two-to-three years. This amount will besmall compared with the $7 billion overall advertising spend in India.

CSPs can look forward to increasing their data revenue from these services.


Consumers will keep receiving irrelevant ads and it will be a while before advertisers start to sendtargeted ads




Sample Vendors: Apple; Google; InMobi; Microsoft; Mobile2Win; Nokia; Yahoo

Recommended Reading: "Forecast: Mobile Advertising, Worldwide, 2008-2015"


Analysis By: Arup Roy

Definition: Traditional infrastructure outsourcing services are multiyear or annuity contracts orrelationships involving the continuing service delivery and management responsibility for operatingIT infrastructure assets. These may include three towers of service: data center, desktop and helpdesk.

This market is changing rapidly. IT infrastructure utility services and other emerging businessmodels, such as cloud computing, infrastructure as a service, desktop utility and desktop as aservice, all fit into this category of IT services.

Position and Adoption Speed Justification: This market is changing rapidly and is a high-growtharea in India. IT infrastructure utility services and other emerging business models, such as cloudcomputing, virtualized/thin-client desktop and desktop as a service, fit into this category of ITservices and should be considered (traditional delivery models/offerings will not disappear) the nextgeneration of this type of offering. The new offerings will progressively include increased levels of ITservices industrialization based on such alternative models. For India, the towers of service are, inpractice, often combined; in the first-generation deals in this market, they are frequently treated asone bundle of infrastructure service. Driven by the continued exodus of IT resources fromorganizations to the vendor ecosystem, the ability to be nimble and agile in a dynamic market, andlooking for differentiation in a highly competitive market, buyer organizations are leveraging externalservice providers and engaging with them in infrastructure outsourcing or managed-service-typeengagements.

Currently, most Indian organizations have small local vendors maintaining the infrastructure. Theseare primarily maintenance or break/fix engagements and generally lack a monitoring andmanagement component. This is now changing to full-fledged outsourcing or managed-serviceengagements, in which either IT infrastructure or parts of it (some IT towers) are being outsourcedto external providers.

Although most Indian buyers are still in the first generation of IT outsourcing (ITO), some are movingfrom first to second generation. The typical challenges observed are the following:


■ Inability to draft a watertight business case

■ Inability to prepare a solid RFP document that adequately represents their needs and what theywant to achieve from the relationship

■ Lack of experience in vendor evaluation and selection, and identifying the right deal type/engagement model

■ Issues in service governance

Gartner expects ITO to become mainstream in the next two to five years in India.

User Advice: Key advice to Indian organizations considering IT infrastructure services outsourcingincludes:

■ Build a sourcing strategy identifying the infrastructure services that are candidates foroutsourcing and related benefits, and communicate them efficiently to all involved internalstakeholders; define the outcomes you require in the resulting sourcing action plan. Definescope and focus carefully on transition, governance, objectives definition and internalcommunication.

■ Pay attention to the local capabilities of global vendors. Capabilities and behaviors of vendorsvary dramatically in different regions of the world, and assessing the local "fit for purpose" iskey. Assess the maturity of offerings for a specific solution with ITO; refer to Gartner's globalITO Hype Cycle.

■ To achieve cost-effective solutions with a good quality of service, assess the providers'investments in standardized offerings and leverage those, wherever possible, instead ofadopting a more customized solution in which local providers will specialize.

■ Be open-minded and consider piloting to the emerging business models in IT services,especially IT utility services and cloud computing, but ensure that the offerings meet yourbusiness requirements and that the providers' pricing structures are clear, comprehensible, andbacked up by commitment and investments for the relative portfolio road map.

■ When evaluating ITO service providers, ensure they have sound service managementmethodologies, which are aligned to, or based on, industry best-practice frameworks andstandards, such as ITIL v.3, Six Sigma and ISO 20000. Don't focus too much on costs until youhave established that the candidate service providers can deliver the required services in thelocations you want at the quality of service your organization needs.

■ Ensure your requirements match the deal "sweet spots" of prospective service providers, andmake sure they will work with you on a sound contractual basis with good SLAs. Conductreference checks, and be strict in the due diligence process.

Business Impact: Successful IT infrastructure service outsourcing enables companies to controland reduce IT operations costs; focus on core business initiatives; improve end-user service levels;access critical IT skills, processes, methodologies, infrastructure and global resources ofoutsourcers; focus IT staff on strategic business projects; shift capital investments in IT to


outsourcers and move to a model based on operating expenditure; enable scalability of ITapplications; enable improvement of speed to market; and provide resources and capacity to matchthe needs of the business.

Use of emerging infrastructure-utility-based models will also enable end users to scale up theirbusinesses more easily and subsequently scale down costs in times of lower use, such as we'veexperienced recently in the global financial crisis.




Sample Vendors: Allied Digital; Dimension Data; Glodyne Technoserve; HCL Infosystems; HCLTechnologies; HP; IBM; Progressive Infotech; Tata Consultancy Services; Team Computers; TechMahindra; Wipro

Recommended Reading: "Deal 'Sweet Spot' Analysis of Regional IT Infrastructure ServicesProviders in Asia/Pacific"

"Outsourcing Advisory: Executing the Sourcing Evaluation and Selection Phase"

"Data Center Outsourcing, Hosting or Cloud? Use Gartner's Market Map and Compass to Decide"

"Outsourcing Survey Shows We Still Have Lots to Learn"

"Steering Your Business Through the IT Services and Outsourcing Revolution"

"Cloud-Enabled Outsourcing Exemplifies Continued Evolution in Services"

"Data Center Services: Regional Differences in the Move Toward the Cloud, 2012"

"Gartner on Outsourcing, 2011 to 2012"

"Common Outsourcing Challenges Faced by Indian CIOs"

CFD Analysis

Analysis By: Rakesh Kumar; John R. Phelps

Definition: Computational fluid dynamic (CFD) analysis uses numerical algorithms to analyze andmodel the flow of air around data center hardware surfaces such as servers and storage systems.These simulations provide point-in-time data on the flow, speed, direction and temperature of theair. With this information, data center and facilities managers are able to determine the efficiency ofair-handling cooling units to remove heat and determine the optimal layout of hardware andperforated floor tile placement in a data center.


Position and Adoption Speed Justification: CFD analysis has been used extensively in fluiddynamics to model the effects of fluid flow over a surface for more than 20 years. For example,aircraft or car design uses these techniques extensively. It's attractive because it is more cost-effective and practical than physical testing. This is especially true when analyzing airflow inside andaround building structures. Over the last three-plus years, CFD analysis has started to be usedmainly in existing data centers as a mechanism to gather accurate data to allow better capacitymanagement prior to refurbishment projects being started. In this sense, CFD analysis not onlygives accurate data on the cooling effectiveness of the site, but it also allows a "what if" analysis ofthe spatial layout of the IT and facility hardware. This means that end users can plan to moveequipment within the site and rearrange raised floor tile openings to maximize air flow, therebyextending the life of their current data center site before having to do any structural refurbishmentwork.

Over the last 12 months, many design consultants and organizations building new data centers areusing CFD as part of their initial design specifications. In this sense, the proposed layout of thehardware, energy profiles and cooling capabilities are all modeled well before construction work onthe site is started. As the data center is being built and commissioned, further CFD analysis isundertaken to fine-tune the layout and equipment. The aim of this approach is to ensure that theproposed design is optimized for energy and cooling efficiency as soon as the data center is beingused.

User Advice: Data center and facilities managers looking to build new data centers should use CFDanalysis to design the optimal air-conditioning system for a given computer room layout. Userslooking to generate some additional floor space or cooling capacity should use CFD analysis tounderstand where cooling inefficiencies exist, and where temperature hot spots are causingproblems. Although the technique is specialized, organizations with large data centers that undergosignificant changes should consider using CFD analysis every 12 months. Because of its specializednature and its frequency of use, CDF analysis is best left to external consultancy organizationsrather than developing the skill in-house.

CFD analysis may not be useful for newer cooling technologies, such as in-row and in-rack cooling,especially if using hot-aisle or cold-aisle containment solutions. If a data center moves to all in-rowand in-rack with containment, then CFD may have limited benefits.

Business Impact: CFD analysis can create additional cooling and floor space capacity, which canoffset the need to do structural renovations or build a new data center. The savings can range fromtens of thousands to millions of dollars. The cost of a CFD analysis for a data center isapproximately $25,000, and although the level of competition has increased slightly during the pastyear, prices remain stable.



Maturity: Emerging

Sample Vendors: Ansys; Future Facilities; Innovative Research; Mentor Graphics; Novabase


Advanced Server Energy Monitoring Tools

Analysis By: Rakesh Kumar; John R. Phelps; Jay E. Pultz

Definition: While data center infrastructure management (DCIM) tools monitor and model energyuse across the data center, server-based energy management software tools are specificallydesigned to measure the energy use within server units. They are normally an enhancement toexisting server management tools, such as HP Systems Insight Manager (HP SIM) or IBM SystemsDirector.

Position and Adoption Speed Justification: Energy consumption in individual data centers isincreasing rapidly, by 8% to 12% per year. The energy is used for powering IT systems (forexample, servers, storage and networking equipment) and the facility's components (for example,air-conditioning systems, power distribution units and uninterruptible power supply systems). Theincrease in energy consumption is driven by users installing more equipment, and by the increasingpower requirements of high-density server architectures.

These software tools are critical to gaining accurate and real-time measurements of the amount ofenergy a particular server is using. This information can then be fed into a reporting tool or into abroader DCIM toolset. The information will also be an important trigger for the real-time changesthat will drive real-time infrastructure. Hence, for example, a change in energy consumption maydrive a process to move an application from one server to another. Server vendors have developedsophisticated internal energy management tools during the past three years. However, the tools arevendor-specific, and are often seen by the vendors as a source of competitive advantage over rivalhardware suppliers. In reality, they provide pretty much the same information, and it is the use ofthat information in broader system management or DCIM tools that generates enhanced user value.For example, using the energy data to provide the metrics for energy-based chargeback isbeginning to resonate with users, but requires not just server-based energy management tools, butalso the use of chargeback tools.

User Advice: In general, users should start deploying appropriate tools to measure energyconsumption in data centers at a granular level. This includes information at the server, rack andoverall site levels. Use this information to manage data center capacity, including floor space layoutof new hardware, and for managing costs through virtualization and consolidation programs. Usersshould acquire energy management tools that report data power and energy consumption efficiencyaccording to power usage effectiveness (PUE) metrics as a measure of data center efficiency.

Specifically for servers, users need to ensure that all new systems have sophisticated energymanagement software tools built into the management console. Users should ensure that thefunctionality and maturity of these tools are part of the selection process. We also advise users togive more credit to tools that provide output in a standard fashion that is easily used by the DCIMproducts.

Business Impact: Server-based energy management software tools will evolve in functionality tohelp companies proactively manage energy costs in data centers. They will continue to becomeinstrumental in managing the operational costs of hardware.





Sample Vendors: Cisco; Dell; HP; IBM

Unified Communications

Analysis By: Sanish KB

Definition: Gartner defines unified communications (UC) products (equipment, software andservices) as those that facilitate the interactive use of multiple enterprise communications methods.This can include control, management and integration of these methods. UC products integratecommunications channels (media), networks and systems, as well as IT business applications and,in some cases, consumer applications and devices. For a detailed description, see "MagicQuadrant for Unified Communications."

Position and Adoption Speed Justification: The leading global UC vendors now offer completeUC suites in the market. However, due to large existing investments in the communicationsinfrastructure and the management of its life cycle, many enterprises in India tend to have retainedsolutions from communications infrastructure vendors, such as Avaya, Alcatel-Lucent, Cisco, Mitel,NEC and Siemens, integrated these existing solutions with UC suites based on popular emailvendors' UC suites, such as Microsoft Lync or IBM Sametime. Key UC functional areas that arebeing combined include PBX, Internet Protocol PBX, softphones, voice mail, email, desktopcalendaring, unified messaging, audioconferencing, Web collaboration, videoconferencing, IM andpresence. Enterprises in India are now considering their UC implementation plans more activelythan before, but in small and midsize businesses (SMBs), decisions are driven more by lowacquisition costs than by specific technology or business goals. As a result, these companies oftenselect specific and basic communications products rather than broader portfolios, so vendors arefocusing on bundled basic UC solutions targeting SMB customers.

User Advice: Indian enterprises should evaluate their existing communications infrastructure anddevelop a strategic UC migration path so that communications equipment and software can beupdated or acquired systematically as part of a broad UC vision. This approach will also enableIndian enterprises to have a strategic vendor selection process and to avoid overbuying of licensesand other communication equipment during the UC implementation. Leading UC vendors are nowoffering a complete UC suite, but they might not have best-of-breed solutions across all UC productsets or services. Hence, enterprise planners should expect to work with multiple strategic vendorsto source best-of-breed UC portfolios in their environment. In the multivendor approach, enterprisesmust evaluate their UC integration provider's expertise and implementation capability in that UCenvironment (for example, by checking vendors' certifications and customer references). Indianenterprises can also learn from UC deployments in more-mature regions, such as North Americaand Western Europe, where UC solutions can yield improvements in business processes (such asfaster access to information, improved collaboration among employees, and better access forremote or mobile employees). Enterprises in India should evaluate UC to understand how thesesolutions can help them gain a competitive edge in the market. As UC as a service (UCaaS)


becomes more mature, users are likely to consider a hybrid environment of in-house and cloudsolutions, depending on their business requirements.

Business Impact: UC improves the ability of individuals, groups and enterprises to communicatethrough real-time human interaction. This is typically reflected in speedier responses to events,reduced human delays in business processes and the improved availability of accurate information.The integration of suitable UC solutions into enterprises' major IT applications can improve theefficiency of employees and workgroups, as well as leading to better productivity, especially inlabor-intensive organizations. UC is poised to act as a utility that facilitates the use ofcommunications to automate the IT applications used to deliver business processes in an approachthat Gartner characterizes as communications-enabled business processes.




Sample Vendors: Aastra Technologies; Alcatel-Lucent; Avaya; Cisco; IBM; Microsoft; NEC;Siemens Enterprise Communications

Recommended Reading: "Predicts 2012: Successful UC Deployments Depend on DefiningOrganizational Objectives and Understanding the Challenges"

"Magic Quadrant for Unified Communications"

"SWOT: Microsoft, Enterprise Unified Communications Business, Worldwide"

"Planned Research for Unified Communications and Collaboration, 2012"

"A Technology Framework for Enterprise Unified Communications"

"Cool Vendors in Enterprise Unified Communications and Network Services, 2012"

Business Process Management Suites

Analysis By: Asheesh Raina

Definition: A business process management suite (BPMS) is a complete set of integratedcomposition technologies for managing all aspects of a process — people, machines, information,business rules and policies supporting full process discovery, analysis, design, development,execution, monitoring and optimization cycle, in which business professionals and IT collaborate aspeers. For a complete definition of BPMS, please see "Market Definitions: Software."

Position and Adoption Speed Justification: Traditionally, enterprises in India have been slower toadopt BPMS technologies than enterprises in North America and Western Europe, because, untilrecently, low labor rates diminished the need for process automation.


Adoption of BPMS and business process management (BPM)-like or BPM-enabling technologiescontinues to attract vertical industries, such as banking, financial services, business processoutsourcers and insurance, to India, mainly driven by a growing emphasis on agility, processautomation and optimization. However, BPMS adoption has not been as high as anticipated byvendors and service providers, because of implementation challenges, such as process engineeringcapabilities, domain understanding and complexities at the user level, availability of skills andcultural reluctance.

High-commercial BPMS product costs for many cloud services providers and BPO providers alsohave caused many of them to build their own platforms instead for BPO/cloud business (Cognizant,Wipro) or sometimes use open source. This has made BPMS adoption in India somewhatchallenging, and is the reason that it is sliding into the Trough of Disillusionment. Gartner believesthat BPMS will emerge from the trough and move toward the Plateau of Productivity to becomemainstream within five to 10 years. Some of the strong drivers are:

■ Vendors, both international and Indian, will start addressing the market differently by extendingconsulting services and best practices to articulate the overall value proposition of BPMS.

■ BPMS via cloud and as-a-service offerings are strong drivers.

■ Growing maturity and low barriers to entry for newer Indian vendors will make this transitionmore forceful.

■ As the ecosystem become robust, competition will drive cost downward, thus eliminatingconcerns about support, skills and overall TCO.

■ Many vendors will target new lines of business and niche vertical industries, such as healthcareand pharmaceuticals.

Also, BPMS adoption among Indian and India-based service providers/system integrators, such asAccenture, Capgemini IBM, HCL, IGate, Wipro, TCS, Infosys and Virtusa, has resulted in BPMcenters of excellence in India with a ready pool of software development talent.

Although BPMS in India continues to attract technology adopters, such as banks, communicationsservice providers, business process outsourcers and retailers looking to automate processes andattain business agility, there is still considerable way to go before the penetration of BPMS-relatedtechnologies approaches mainstream.

During the next five to 10 years, vendors, user organizations and consulting firms will start lookingat BPMS as an evolved market and will be more ready than ever before to adopt BPMS in a matureand successful way.

User Advice: Organizations in which processes require coordinating human efforts with automatedactivities and information flow should consider BPMS as a key step in attaining business agility.They should examine BPMS that supports workflow, business rule management, and human andcontent collaboration to support sales, customer service and other external-facing and less-structured business processes.


The availability of skills is now increasingly being addressed by a vendor ecosystem offeringextensive and credible consulting, services, training and project support.

Midsize organizations in India, or those with low process skills (in areas such as modeling, analysis,measurement and simulation/optimization), should, therefore, look for vertical solutions that comewith industry-specific process flows and content. Users in India should consider long-term technicaland business support contracts while negotiating with BPMS vendors.

Also, training and knowledge-based assets, such as frameworks and white papers, should be thekey vendor evaluation criterion. Indian organizations must create in-house teams that should beresponsible for supporting governance issues and fine-tuning implementations according to domainprocess requirements. It is also important that organizations in India evaluate a vendor'scommitment in India — to confirm if the presence of a BPMS vendor in India is more tactical, asopposed to opportunistic.

Business Impact: BPMS will change the way processes are automated and managed in India.Their use will require bypassing cultural reluctance — the industry will need to reconcile with theshift in ownership and responsibilities.

Business users in India will be more responsible for process management, which means that BPMSwill enable business process participants to directly change process designs and execute work.

Various vertical solutions and best practices will evolve in a move toward being process-orientedand business-user-centric. This will also lead to changes in the way Indian enterprises develop andacquire applications — it will require them to be amenable to the changes in applicationdevelopment methods and newer delivery models that come with BPM.

Finally, it means that businesses and business users will now be more directly in control of, andresponsible for, reducing process costs, cycle times, resource consumption and risk.




Sample Vendors: AppPoint; IBM; Intalio; Newgen Software Technologies; Pegasystems; TibcoSoftware

Recommended Reading: Cool Vendor India, 2012

India Hype Cycle, 2011

Market Share: All Software 2012

Open-Source Development Tools in India

Analysis By: Asheesh Raina; Laurie F. Wurster


Definition: Open-source software (OSS) is licensed software in which the source code is madeavailable to users to allow for personal modification. This software can be modified and

redistributed by users in compliance with the original license. OSS is released under licenses andterms defined by the Open Source Initiative.

Position and Adoption Speed Justification: The level of maturity and saturation of open-sourceapplication development tools varies, depending on the maturity of the architectural stack. In somemarkets, open-source solutions rank among industry-leading products, while in others, they remainoutside the scope of all but the most aggressive technology adopters.

Here, our purpose is to provide an aggregate view of the state of open-source development andintegration tools within the context of adoption in the Indian market. Hence, OSS technologiesconsidered in this context include open-source application development (AD) and object-orientedanalysis and design tools, testing tools, application life cycle management tools, and integrationtechnologies (such as application servers and portals) on a broader basis.

OSS development and integration tools in India are sliding into the Trough of Disillusionmentbecause of the evolving and changing mind-set of decision makers. Although low or no (upfront)cost has always been a driver of OSS adoption, recent economic conditions have moved cost-benefits past vendor independence as the primary driver among users and adopters in India.

However, we expect OSS AD tools to become mainstream within a five- to 10-year time span asIndian enterprises begin to use OSS development as a method to control IT costs. Although OSSdevelopment tools form an integral element of the development toolkit for various large enterprises,in other smaller and midsize organizations, these tools are just now emerging as a viable alternativeto traditional closed-source solutions. The recent global slowdown, over the past three years, hashastened the adoption of open-source AD and integration tools toward more-serious usage; that is,beyond the market penetration of 1% to 5%. In addition, OSS AD tools are also used by a largenumber of both large and small service providers to pass on the cost-benefits to customers andmaintain profitability.

Mature OSS tools, such as Selenium, Tellurium and JMeter, are being used for software testing;however, OSS tools for application life cycle management, AD design and some other ADtechnologies have not yet attained similar levels of technology maturity or market traction.

Nonetheless, OSS vendors and system integrators (SIs) have started to focus on addressingsupport issues, which will further stimulate the use of OSS within the market. Thus, overall tractionwill increase as more enterprises (both large and small) use these tools in a more formal and maturemanner.

User Advice: India has a large pool of established SIs, and Indian organizations very often andcommonly use their services for custom application development. Since familiarity with legal use ofOSS is still very low in India, end-user organizations must seek indemnity and clarity on licensingtypes while using SI services involving use of open source.


Users should focus on cost and risk reduction as a primary benefit, with flexibility and vendorindependence as secondary benefits.

Users should carefully examine the various OSS licensing options to be fully compliant and to avoidany legal issues regarding intellectual property rights.

Organizations should also plan to form in-house teams or centers of excellence for supporting OSSinitiatives. These centers of excellence will also negate the effects of skill attrition to a large extent.

Organizations could also purchase long-term support commitments directly from OSS vendors ordedicated OSS SIs.

Business Impact: OSS will affect the entire ecosystem — from AD to deployment and distributionof those applications. It will also affect organizations and all proprietary and commercial vendorsbecause they will be forced to open their products for integration, participate in the open-sourcecommunity, lower their product prices and modify the business model to meet competition fromOSS. User organizations will maximize on-premises usage of OSS with support from internal ITdepartments. Organizations will also look to adopt OSS as a key strategy to control recurringmaintenance costs.




Sample Vendors: Alfresco Software; Cignex Datamatics; Eclipse Foundation; Liferay Portal

Recommended Reading: "Q&A: Top 10 Things You Need to Know About OSS in Asia/Pacific"

"Cool Vendors in India, 2012"

"Hype Cycle for ICT in India, 2011"

Video Telepresence


Definition: Video telepresence is a form of immersive video communication that creates theimpression of being in the same room as other conference participants. These conferenceparticipants appear as life-size individuals on large plasma, LCD, light-emitting diode or projectionscreens. Multiple cameras and microphones pick up individuals or pairs of individuals, so that allaudiovisual information becomes directional, with eye contact and spatial sound aligned with thelocation of the person speaking.

Position and Adoption Speed Justification: The term "telepresence" has slowly but surelybecome synonymous with "videoconferencing." With most videoconferencing solutions nowcapable of running HD video resolution at 1,080p (progressive scan) lines of resolution, the


technological differences between immersive and nonimmersive forms of telepresence havebecome blurred.

Adaptive solutions — both single and multiscreen — fit into established environments and costconsiderably less than fully immersive suites, while "lite" solutions may be no different from regularHD room videoconferencing, unless integrated to provide some of the nontechnology aspects thatmake the environment immersive: the way in which the room is configured (with the look, feel andlighting of different rooms being set up to aid the impression of sharing the same physical spacewith other counterparts), and the integration and management of these systems being such thatthey don't get in the way of collaboration.

Operational simplicity and high availability remain a key part of the added value in telepresence.Systems are designed to enable anyone to use them to their full potential, with little or no priortraining, without the connectivity problems associated with traditional room videoconferencingsolutions.

Telepresence systems make high demands on the network, with low-compression, three-screen,HD rooms taking anything from 8 Mbps to 45 Mbps of dedicated bandwidth for video and content.They are typically deployed across Multiprotocol Label Switching (MPLS) networks, often dedicatedto and designed for video traffic with minimal latency so that users can retain natural levels ofspontaneity during interactions with other participants. However, providers are increasinglyadopting new encoding standards, such as H.264 Scalable Video Coding (SVC), to allow for the useof best-effort or contended bandwidth.

While this initially increases the mix of encoding standards in the market, its future widespread use,combined with a common architecture for enabling multiscreen system interoperability, usingTelepresence Interoperability Protocol (TIP), will help to push telepresence islands towardinterconnectivity. While many service providers have continued to slow the pace of interconnection,through protracted negotiations on bilateral peering, the process is inexorable.

In the Indian telepresence market, all vendors are aggressively competing to grab a leading marketshare. Most telepresence solutions sold in India are distributed between a few corporate and majorenterprises and shared public access installations. The primary use of telepresence in mostorganizations is for internal meetings or meetings with clients and partners who normally visitcompany premises as a way to reduce travel. However, the collaboration features lend themselvesincreasingly to project management and engineering environments, where travel is not necessarilybeing avoided, but the added dimension afforded by telepresence makes new forms of virtualcommunications feasible for users, who benefit from increased productivity and speed of decision-making as a result.

In India, Tata Communications has rolled out shared public access facilities through Taj Hotels andthe Confederation of Indian Industry in selected cities. Global enterprises with the financialresources are the prime adopters of telepresence solutions and their purchase is easily justified,based on ROI from cost savings on employee travel and also because these solutions supportenterprises' green initiatives and employee collaboration efforts. Many telepresence vendors aretaking the technologies and capabilities first provided in immersive environments and placing them


in lower-cost solutions down to the desktop level. They are going beyond interlinking telepresencerooms with other videoconferencing endpoints — a key focus now is on enabling any unifiedcommunications softclient to connect. The wider use of H.264 SVC is the key technologymechanism being used, and most vendors have either adopted this or stated publicly their intentionto do so by the first half of 2012.

Deployments of telepresence have primarily focused on supporting group meetings betweeninternal users, with occasional clients and partners via intercompany exchanges. However, a recenttrend has been toward personal (or executive) telepresence deployments, which trade some of theimmersive cues of large screens and lighting for the convenience of being in the user's own office.Growth in demand for immersive systems has slowed, to be replaced by much larger growth indemand for personal systems.

Gartner expects immersive telepresence adoption to continue to be driven by larger organizationsand specific vertical industries, including financial services, banking, pharmaceuticals, telemedicine,high-technology manufacturing, consumer products and motion pictures/entertainment. Thehospitality and managed office industries have rolled out a limited number of telepresence suites forpay per use in their conference centers, but this market lacks the scale to become viable on astand-alone basis.

New investments in immersive group systems are increasingly being replaced by investments inpersonal and executive systems. This is decreasing the overall scale of the addressable market forimmersive systems, and speeding up the rate at which these types of solution move off the HypeCycle.

User Advice: Organizations in India should consider video telepresence as the high end of theirvideoconferencing technology requirements, rather than a stand-alone solution. Any enterpriseplanning to deploy telepresence must carry out a thorough review of its network infrastructure, aswell as proper network planning. Midsize companies in India, without a large-scale use oftelepresence, can leverage the time-share (that is, pay per use) telepresence solution availablethrough shared public access. However, there are some challenges, such as the availability ofsuitable sites in the right locations and the traveling time between the telepresence location and theuser's office. Telepresence can deliver a more immersive, higher-quality group videoconferencingexperience than a traditional room-based or desktop videoconferencing solution, but Indian midsizecompanies should also evaluate the use of Communicator, Sametime or webcam solutions, orroom-based HD/standard-definition videoconferencing to strike a balance between cost and utility.

Business Impact: For regular telepresence users, travel cost reductions and improved productivitywill provide a business case with a relatively short payback period, often less than 18 months.Telepresence typically demands a utilization rate of more than three hours per day — three to fourtimes what most organizations achieve with traditional videoconferencing.

The cost of some immersive endpoint solutions has fallen to around $35,000 per screen/codec (so athree-screen environment will cost around $100,000), but the costs associated with infrastructureare significant, and the networking and managed services costs will typically be double the capitalinvestment in the system over a three- to five-year period.


Early adopters indicate that telepresence has boosted usage rates into the 30% to 40% range fororganizations, based on a 10-hour business day, compared with less than an hour per day forunmanaged videoconferencing systems. Increased usage is key to cost justification and customersuccess with telepresence.

Public utility services are still not widely available, limiting the benefit they bring to enterpriseswishing to extend the reach of their own telepresence footprint. A key benefit of telepresence, evenover other forms of video communications, is its ability to displace the need for travel by highlymobile executives. From an environmental perspective, this can help reduce Scope 1 and Scope 2greenhouse gas emissions. However, to lower travel costs and emissions, additional governance,policy and behavioral measures are required, particularly top-down mandating of video as analternative to face-to-face meetings.




Sample Vendors: Business Octane; Cisco; LifeSize; Polycom; Tata Communications

Recommended Reading: "SWOT: Vidyo, Videoconferencing and Personal Telepresence Solutions,Worldwide"

"SWOT: Polycom, Video Communications Solutions, Worldwide"

"SWOT: Cisco, TelePresence Technology Group, Worldwide"

"MarketScope for Telepresence and Group Video Systems"

"Why Reach Is the New Quality in Enterprise Video"

"Telepresence Is Coming Home: Are You Ready?"


Analysis By: Asheesh Raina; Yanna Dharmasthira

Definition: Gartner defines software as a service (SaaS) as software that's owned, delivered andmanaged remotely by one or more providers. The provider delivers software based on one set ofcommon code and data definitions that is consumed in a one-to-many model by all contractedcustomers at anytime on a pay-for-use basis or as a subscription based on use metrics. For acomplete definition, see "Market Definitions: Software."

Position and Adoption Speed Justification: The purpose here is to provide an aggregate view ofthe state of SaaS in India.


SaaS has deeper penetration among early adopters (those using a SaaS model or SaaS vendors fortheir organizational requirements), such as in the banking, telecommunications and retail industries,who are increasingly better at dealing with the issues concerning reliable infrastructure andconnectivity. However, there are still concerns about network instability and the ability to scale upand extend services in remote Indian locations (those with low infrastructure in terms of Internetpenetration and other logistics connectivity). In addition, although Indian enterprises have a highawareness of and familiarity with SaaS, issues regarding data confidentiality and security remainprimary concerns. As a result, there is no change in the positioning of SaaS in the Hype Cycle thisyear.

Different software applications and solutions for SaaS in India would be placed at different positionson a Hype Cycle. The slide into the Trough of Disillusionment reflects the fact that SaaS isestablished in certain markets in applications, while in infrastructure, it remains nascent. During thenext two to three years, vendors, user organizations and independent software vendors areexpected to start looking at SaaS as an evolved market that is more mainstream-ready. Forinstance, leveraging cloud computing infrastructure will require that the SaaS model be mature.Point solutions within application software will continue to have higher adoption, compared with thesuite type of application. Currently, ERP components (such as financial, employee performancemanagement and recruitment) continue to be the more common SaaS implementations, followed bysales and customer service within CRM and selected modules within supply chain management.However, overall usage is still low in India. Over the next two years, other SaaS applications, suchas talent management and marketing, are expected to be increasingly demanded.

Healthcare and hotel/hospitality management are the emerging vertical industries in India for theSaaS market. Still, for SaaS to further penetrate and appear in a more-mainstream form in India,advancement in infrastructure and its reliability must be addressed, as well as issues concerningfaster deployment time, better integration with existing systems and expandability of vendor datacenters (see "User Survey Analysis: Plans for SaaS Application Software Use in Emerging VersusDeveloped Countries, Asia/Pacific, 2012").

User Advice: Companies in India with complex requirements should not assume that they willsignificantly lower their total cost of ownership or reduce complexity simply by moving to SaaS.Before deploying a SaaS solution, they should use the Gartner SaaS Readiness AssessmentChecklist (see "Use the SaaS Readiness Assessment Checklist Before Deploying Your SaaSSolution").

However, companies with tight capital budgets, that are IT-resource-constrained, or that want toget something simple deployed quickly should consider SaaS. Often, ease of use (driven from auser-friendly interface) is much better with a SaaS product, allowing a quicker time to value. But thisis not always the case, and sometimes the underlying data models are still too basic to allowcomplex business processes to be conducted. As with any product, a company should carefullyevaluate the functional capabilities and data security needs of the SaaS offering to meet thecompany's specific requirements.

SaaS vendors in India need to leverage regional testimonials articulating value propositions aboutupfront cost cutting. This is because a large portion of establishments in India belong to the small or


midsize business (SMB) segment (most are small and emerging startups), with a pressing need tolower upfront costs — and doing this by managing software costs tops their list.

Business Impact: SaaS has the effect of lowering expenses for the first few years because it doesnot require upfront capital investment. However, in outlying years, SaaS may become moreexpensive because the operating expense does not decrease, and downstream expenses, such asintegration requirements with back-end systems, may increase. SaaS is helpful to companies thatdo not have IT resources to deploy and maintain on-premises software; this is prevalent amongSMBs, but it is also applicable to large businesses that have experienced downsizing in their ITdepartments or multinational companies with subsidiaries in India. Companies will continue toevaluate SaaS for different purposes, such as for a net-new application, when it's time to replace alegacy application, or as an extension of on-premises software because of its ease of deployment.It is also worth noting that a SaaS offering might be a good choice since it automatically providesoff-site backup and business continuity. However, the converse is also true: It might be harder toget the data back if the SaaS provider goes out of business. User survey data also indicates that anincreasing percentage of Indian companies are using SaaS for net-new solution development. Asconcerns about reliable and advanced infrastructure are addressed, the SaaS model will experiencemainstream adoption in India.




Sample Vendors: Ace Data Devices; Daptiv; EmployWise; salesforce.com

Recommended Reading: "Cool Vendors in India, 2012"

"User Survey Analysis: Plans for SaaS Application Software Use in Emerging Versus DevelopedCountries, Asia/Pacific, 2012"


CRM in India

Analysis By: Praveen Sengar; Yanna Dharmasthira

Definition: CRM is a business strategy that optimizes revenue and profitability while promotingcustomer satisfaction and loyalty. CRM technology enables strategy and identifies and managescustomer relationships, in person or virtually. CRM software provides functionality to companies inthree segments: sales, marketing and customer service.

Position and Adoption Speed Justification: CRM deployment in India has come a long way frompure sales automation to integrated, end-to-end CRM suites being deployed by larger enterprises.Enterprises started with sales automation in verticals such as IT services, banking, financial servicesand pharmaceutical. The rapid growth in banking, insurance, telecommunications, consumer


electronics and utilities has led to an increasing focus on customer service and support. Businessprocess outsourcing has also led to large deployments of contact center applications in India.

CRM in India has been growing aggressively, with double-digit growth for the past few years, and itis expected to reach a compound annual growth rate (CAGR) of 20% in the next five years.Currently, India's CRM share is 11% of the overall Asia/Pacific region (excluding Japan). India is thethird largest CRM market in Asia/Pacific, marginally lower than China. Sales and customer servicesupport are the largest CRM subsegments in India, with a 41% and 35% share, respectively.Marketing follows, with a 24% share in 2012.

Enterprises in fields such as banking, financial services and telecommunications are now looking tosupport multichannel marketing and customer service while experimenting with emerging conceptsaround social. Mobility is catching up quickly in the field services and sales automation space.Geographical spread and large distribution needs are pushing demand for partner relationshipmanagement and channel management. Organizations in the consumer goods, retail, automotiveand life sciences verticals are integrating CRM applications in back-to-back office systems, such asERP and supply chain management, to improve demand planning, inventory management andsupply chain efficiencies. However, penetration of CRM in verticals like government, utilities andmanufacturing is still relatively low and it will take some time for organizations in these vertical torealize the full potential of CRM.

A departmental approach to CRM, lack of CRM strategy and vision, and a technology-drivenapproach to CRM and data quality has been a major impediment in the successful implementationand full utilization of CRM systems. However, organizations are maturing in understanding theirCRM needs, and are successfully building a business case for CRM projects. Also, data migrationand data quality projects have picked up in retail, telecommunications, banking and financialservices, with a specific focus on customer churn management, customer segmentation, and cross-sell and upsell opportunities. Moving forward, in line with the growth of the Indian economy and itsintegration with the global market, not only large enterprises, but small to midsize enterprises alsoneed to improve their sales, marketing and customer services processes. This will help to trigger theCRM market adoption.

User Advice: Enterprises in banking, financial services, retail and telecommunications should focuson customer segmentation and integrated marketing management to achieve the next level ofgrowth. White goods, distribution, pharmaceutical and fast-moving consumer goods organizationsshould focus on extending CRM on mobile devices, particularly field services and sales automation,and also on integrating CRM systems to back-office systems.

Centralizing customer ownership and involving different stakeholders across the business will becritical to realizing the benefits of CRM implementation. Small or midsize businesses should look atbasic operational capabilities for sales, marketing and customer service available through softwareas a service (SaaS) vendors or on-premises CRM vendors. However, organizations should considerthe following:

■ CRM as a business strategy and not a technology initiative. Organizations should start withCRM vision and strategy, understand business goals and learn lessons from western CRMfailures of the last decade.


■ Resistance to user adoption is more prominent in India and organizations should put moreweight on ease of use, functionality and localization requirements, such as supporting onlineand offline capabilities, while selecting technology and vendors.

■ Data quality continues to pose a challenge and organizations need to identify key datasetsrequired by focusing on what is the same rather than looking at a large data quality project.

Organizations need to look at total cost of ownership, viability, functionality, usability, ease ofintegration and overall vision while evaluating vendors.

Business Impact: Organizations in India are challenged with customer retention and service quality,which can be achieved through a customer-centric focus and having an integrated CRM systemmanaging the customer life cycle end-to-end. Increased competition and rapidly growing marketsrequire organizations to focus on new customer acquisition, and increase the need to tap intocross-sell and upsell opportunities in their installed bases.




Sample Vendors: CRM next; CustomerXPS; IBM-Unica; Microsoft Dynamics CRM; Oracle (SiebelCRM); salesforce.com; SAP (SAP CRM); SAS; Sugar CRM; Zoho

Recommended Reading: "The Gartner CRM Vendor Guide, 2012"

"The Elusive CRM Magic Quadrant"

"Competitive Landscape: Selling CRM Software in Asia/Pacific"

"How to Develop a CRM Strategy"

"Governance and the Eight Building Blocks of CRM"

Data Deduplication

Analysis By: Aman Munglani; Dave Russell

Definition: Data deduplication is a form of compression that eliminates redundant data on a subfilelevel, improving storage utilization. In this process, only one copy of the data is stored. All otherredundant data is eliminated, leaving only a pointer to the previous copy of the data. Datadeduplication can significantly reduce the amount of disk space required, because only the uniquedata is stored.

Position and Adoption Speed Justification: This technology reduces the amount of physicalstorage required, significantly improving the economics of disk-based solutions for backup,archiving and primary storage. Gartner clients using data deduplication for backup typically report


seven to 25 times the reduction (a 7:1 to 25:1 ratio) in the size of data, and sometimes as high as aratio of 100:1 for file system data or server virtualized images, when data deduplication is used andthere are long retention durations. Although data deduplication is most commonly used in backupactivities, it can be applied to many other use cases, such as long-term archiving and primarystorage, with file storage of unstructured data most frequently considered.

Backup has been an attractive use case for data deduplication, as the most common backupmethodology routinely captures full copies of data (often once a week), whether the data has beenmodified or not. This produces many duplicate data copies that can be data deduplicated to factorout redundant copies. To achieve the highest levels of reduction, backup workloads during a periodof three to four months are typically needed, and a traditional model of nightly incremental backupsand weekly full backups is required. However, even short-term backups can achieve two to sixtimes the reduction, or better. Archiving data deduplication ratios are often in the 3:1 to 10:1 range,and primary file data commonly yields 3:1 to 5:1 ratios.

Data deduplication continues to be a hot topic of discussion in the end-user community in India,and adoption of the technology has been high for backup workloads. Many users consider it amust-have feature when upgrading their backup and recovery systems. Hitherto considered to bean option only for the enterprise-class segment, the adoption for data deduplication technology hasmoved beyond the realms of just the enterprise to gradual adoption from within the midtier and thesmall business segment as well. The drivers for the adoption of this technology are a reduction inthe capacity requirements, better use of existing infrastructure, capital expenditure (capex) savingsof not having to buy more disk capacity as quickly, and the associated savings in floor space, aswell as power and cooling expenses.

Although most adoptions are on the target side, enterprise users are beginning to show interest indata deduplication for the client side. However, concerns about performance have been impedingthe growth. Although awareness of this technology is no longer a concern, considering the growingbase of first time buyers of storage, vendors should continue investing to educate prospectiveclients on the benefits of this technology and to advise on the benefits of its use.

User Advice: For backup workloads, carefully consider the architectures and design pointsmentioned above. Client-side data deduplication generally assumes that the backup software isswitched to the data deduplication software (so a choice in backup application and datadeduplication is being made), if data deduplication is not already an available feature from thecurrent product. Most backup applications have some form of built-in data deduplication; however,cost, degree of integration and ease of use can vary. Gartner often recommends client-side datadeduplication for files, virtual machines (VMs) and target-side appliances, or backup softwareimplementations for large data bases.

If data deduplication is used for primary storage, ensure that the workload matches theperformance characteristics of the data deduplication approach, because performance is typicallynegatively affected; however, not all data types require the highest levels of performance. With somany types of solutions on the market, it's important to investigate several vendors andimplementation architectures to make the best selection.


Business Impact: The effects of data deduplication primarily involve the improved cost structure ofdisk-based solutions, because fewer disks need to be purchased, deployed, powered and cooled.As a result, businesses may be able to use disks for more of their storage requirements, and mayretain data on disks for longer periods of time, thus enabling recovery or read access from disksversus retrieval from slower media (such as magnetic tape).

Backup-to and restore-from disks can improve performance, compared with tape-basedapproaches. The effective cost of replication can be reduced if the data has previously beendeduplicated, because potentially less bandwidth would be required to move the same amount ofnondeduplicated data. Deduplication can improve the cost structure for disk-based archives andprimary storage, because fewer resources are used.

Disaster recovery (DR) is a hot topic of discussion in India, with many implementations beingdiscussed. Data deduplication has a positive impact on DR, because less network connectivity isrequired, and each input/output (I/O) operation carries a larger data payload. Data may be copiedover the network more frequently, because the traffic impact is minimized, due to the reduction indata. For a backup application, data deduplication, along with replication, may mean that physicaltapes do not need to be made at the primary location and manually taken off-site. Instead, datadeduplication and replication can be used to electronically vault the data.

For primary storage, data deduplication can have a positive effect on improving overallperformance, and on reducing the amount of cache consumed, reducing the overall I/O operationsper second (IOPS). Although latency-sensitive applications, such as transactional databases, oftenare not a good fit for most organizations, server virtualized images (VMs) and networked file shareshave proved to be solid use cases.




Sample Vendors: Asigra; CA Technologies; CommVault; Dell; EMC; ExaGrid Systems; FalconStorSoftware; HP; IBM; NetApp; NEC; Oracle; Quantum; Quest; Sepaton; Spectra Logic; Symantec

Recommended Reading: "Best Practices for Data Deduplication on Primary Storage"

"Magic Quadrant for Enterprise Disk-Based Backup/Recovery"

"Best Practices for Addressing the Broken State of Backup"

"Best Practices for Data Deduplication on Primary Storage"

"Use of Disk for Backup Accelerates at the Expense of Tape"

"Survey Analysis: 2011 Data Center Conference, Backup Driven by Virtual Machine Recovery,Varying Deduplication Strategies and Shortened Retention Policies"


SCM

Analysis By: Sunil Padmanabh; Yanna Dharmasthira

Definition: Supply chain management (SCM) refers to the processes of creating and fulfillingdemands for goods and services. It encompasses a trading partner community engaged in thecommon goal of satisfying end customers.

Position and Adoption Speed Justification: SCM continues to gain positive momentum,specifically in large enterprises as its benefits are increasingly understood and realized in terms ofits ROI. However, penetration remains relatively low, specifically in the small or midsize business(SMB) market. SMBs continue to prioritize or remain focused on implementing and improving coreapplications (such as ERP).

India's high growth mode and the positive global economic outlook trigger growth in the majority ofvertical industries. In line with this, market competition is increasingly tight. Indian organizations thathave adopted ERP and appreciated its benefits are moving on to improve their supply chaincapabilities, seeking cost optimization and market competitiveness. This increases demand formore sophistication in logistics and capability for supply chain forecasting and planning, specificallyin manufacturing, retail, distribution and automotive. As with other emerging SCM markets, IndianSCM organizations are more focused on accuracy, inventory planning and basic processautomation than they are on higher-level capabilities such as advanced forecasting capabilities orsupply chain performance management and analytics.

As the Indian manufacturing and distribution industries are integrating with the global supply chainmarket, the need to trace goods in the supply chain cycle continues to be crucial in the competitiveglobal trading environment. In addition, from a sourcing perspective, organizations continue toimprove their strategic purchasing cycles. Indian supply chain organizations must also understandtheir domestic needs as well as the role they play in global supply chains, and how the needs ofthese two areas are complementary but not the same. Domestically, the focus is on operating theirown supply chains while, globally, the emphasis is on where the organizations fit in the end-to-endglobal supply chain.

India's logistics infrastructure is going through a transformation that will need comprehensivesupply chain management solutions. The growth of various vertical industries, and the need topenetrate wider geographic India coverage with their large variation of logistic maturities, will help totrigger the need for SCM processes and solutions.

The supply chain market in rural India is growing with increasing numbers of multinationalcompanies formulating strategies to penetrate the rural market. This will lead to emergence of betterinfrastructure and logistics providers to cope with the demand.

User Advice: The maturity of SCM technologies in India continues to lag behind the North Americanand European markets, as well as mature markets in the Asia/Pacific region.

Indian organizations considering adopting SCM must ensure that their vendors are committed tothe Indian market for their solutions and support. Obtain relevant Indian market references for anytechnologies under consideration. Advanced SCM initiatives are likely to be needed to manage


increasingly complex supply chains in India's booming manufacturing industries, including steel,automotive and retail. For Indian SCM organizations that have adopted Tier 1 ERP, consider thevalue of the integrated SCM functionality offered by your ERP vendor.

Since SCM skills are scarce within SCM organizations in India, ensure that there are consultingresources for the deployment and support of products under consideration and expect to pay apremium for these resources; however, this will change over time as several Indian systemintegrators develop strong SCM practices. Because many SCM projects, especially globalinitiatives, rely on collaboration with trading partners that may lack SCM skills, enterprises shouldinclude trading partner training and joint business planning as initial steps in an SCM project. Thishas proved to be essential for many North American and European SCM projects.

Business Impact: SCM affects all areas of an organization that deal with the processes of creatingand fulfilling demand. Supply chain capabilities will improve sourcing, supply chain planning andexecution processes. Once SCM consultants and skills are more prevalent in the local market, theadoption toward mainstream will be more rapid.




Sample Vendors: Ariba; JDA Software; Oracle; SAP; Take Solutions

Recommended Reading: "User Survey Analysis: Maximizing SMB Software Revenue in BRIC"

"Key Issues for SCM IT Leaders, 2010"

"Market Share: All Software Markets, Worldwide, 2010"

"Market Trends: Supply Chain Management, Worldwide, 2009-2010"

"The Mahindra Group: Closing the supply chain loop"


Analysis By: Bhavish Sood

Definition: Business intelligence (BI) platforms enable enterprises to build BI applications byproviding capabilities in three categories: analysis, such as online analytical processing (OLAP);information delivery, such as reports and dashboards; and platform integration, such as BImetadata management and a development environment.

Position and Adoption Speed Justification: BI platforms are widely used by enterprises to buildcustom analytical applications and to service information delivery requests. The BI platform marketis well defined with many established vendors. The most commonly used BI platform capabilities —such as reports, ad hoc queries and OLAP — are mature, and there is less and less significant


differentiation between the vendors' core offerings. However, the market is still dynamic, becausetechnologies such as in-memory analytics, interactive visualization and mobility are having an effecton how BI platforms are deployed, used and bought. In addition, as organizations climb the BImaturity curve they are beginning to use less widely deployed — but arguably more valuable — BIplatform capabilities such as predictive modeling and data mining. In revenue share terms, the BIplatforms market is dominated by megavendors and many organizations are currently deploying orplanning to deploy the last major releases of their platforms (for example, Oracle's BI 11g, IBM'sCognos 10, SAP's BusinessObjects 4.0, Microsoft's SQL Server 2012).

In 2011, the market grew 17.5% to reach only $46.7 million — which is why it is categorized as earlymainstream. In 2012, we expect the market to grow about 15.8%, to approximately $54.1 million; itis expected to reach $88.7 million by 2016 with a compound annual growth rate (CAGR) of 12.9%(from 2011 to 2016). BI solutions are, most often, used tactically in departmental deployments: as areporting tool, rather than as a strategic platform to build up analytic capabilities to support decisionmaking. BI implementations that link measures to strategic corporate objectives are still hard tofind, although awareness is increasing. Based on our discussions with clients in India we observethe following:

■ In many industries, especially the regulated ones such as telecom and financial services, clientsare setting up dedicated BI competency centers.

■ Increasing emphasis is being placed on aligning operational metrics with strategic objectives.

■ Consulting and system integration firms are augmenting their capabilities in this area asdemand for these solutions increases.

User Advice: Organizations should deploy BI platforms to describe the dimensions and measuresthat run the business: using reporting and flexible querying to meet the majority of users'information delivery needs, while applying the more sophisticated analysis capabilities for the few inthe user community that need them. BI platforms are a "build" technology, so successful usageand, therefore, ROI depends on the skills of the IT departments and service providers inunderstanding users' requirements and implementing a solution that meets them. Organizationsneed to be careful that their use of a BI platform does not lead to the over-centralization that eithermisses out on requirements — by having too broad a view — or becomes too unwieldy to respondfast enough to business changes and satisfy them in its BI platform definitions. Indian enterprisesspend a disproportionate amount of time on product selection and vendor negotiations comparedto understanding the business impact of implementing a BI solution. A lack of executivesponsorship and focus on data quality continue to be major reasons why Indian BI initiatives fail.

Business Impact: BI platforms enable users, typically managers and analysts, to learn about andunderstand their business. Increasingly, however, BI platforms are being used more pervasively bya wider community inside and outside of organizations. When used to their fullest potential, BIplatforms can have a dramatic effect on the business: by changing the focus from primarily areporting one to process optimization and strategic alignment.





Sample Vendors: Actuate; IBM (Cognos); Microsoft; MicroStrategy; Oracle; Ramco Systems; SAP(BusinessObjects); SAS

Recommended Reading: "Magic Quadrant for Business Intelligence Platforms"

Climbing the Slope


Analysis By: Asheesh Raina

Definition: Service-oriented architecture (SOA) is a design paradigm and discipline that can beused by IT to improve its ability to quickly and efficiently meet business demands. SOA deliversthese benefits by reducing redundancy and increasing the usability, maintainability and value ofsoftware systems. When applied effectively, the SOA paradigm produces application systems thatare intrinsically interoperable and modular.

Position and Adoption Speed Justification: Slowly but surely, SOA is being adopted in India as ameans of creating leverage within the software portfolio, and its principles are being used todevelop integration relationships inside and outside the enterprise. SOA is seen as a primary modelfor integrating cloud-based applications into the existing system portfolio. Vendors of middleware,development tools and packaged applications have delivered SOA capabilities in most of theirproducts. Most user organizations in India are attempting to use SOA concepts as part of theirsystem designs. The near-term ROI in some SOA projects has been difficult to quantify, mostlybecause the results are spread over the lifetime of the solution.

SOA in India has moved post-trough and is climbing the Slope of Enlightenment as organizationsare pleased with the improved flexibility and long-term results. Compared with traditional monolithicor client/server applications, SOA applications are more likely to be spread across multiplecomputers in far-flung locations, composed of parts that are developed and managed by disparate,semiautonomous IT groups (domains), often controlled by disparate business units inside andoutside the company. They run on a mix of heterogeneous application servers, programminglanguages and operating systems; and they are subject to frequent change because of volatilebusiness requirements — thus suiting India's market landscape.

Additional support is also coming from the associated ecosystem of service providers and systemintegrators and through the entry of local Indian vendors. Globally, some organizations have beendisappointed by the low level of service sharing ("reuse") that they have achieved. In cases wherethis value is being measured, however, it can be derived even with a modest quantity of sharedservices. Some SOA projects may encounter problems in governance, testing, configurationmanagement, version control, metadata management, service-level monitoring, security andinteroperability. This is because changes in the fundamental structure of business processes andapplication architectures of this magnitude do not happen quickly or easily, and the challenges arebased on the heterogeneous and distributed nature of the systems, not on any characteristic of


SOA. Learning through global experience and testimonials, most Indian organizations have someongoing commitment toward SOA, and we expect that this will be nearly universal throughout Indiain a few years. Mainstream adoption of SOA in India will depend on vendors' ability to demonstratecompelling ROI through improved efficiency, agility and pleasant end-customer experiences.

User Advice: Indian organizations should consider SOA as a key foundation for future developmentto attain business agility.

SOA is especially well-suited for composite applications in which components are built or managedby separate teams in disparate locations. These components can also leverage pre-SOAapplications by wrapping function and data with service interfaces. Organizations concerned aboutthe lack of maturity and skills in India should stand assured that this is being addressed by vendorsand associated ecosystems by offering extensive and credible services related to SOA training andproject support.

When buying packaged applications, rate those that have SOA more highly than those that don't.However, do not discard non-SOA applications in favor of SOA applications solely on the basis ofarchitecture. SOA should be used to design new business applications and those that will undergocontinuous refinement, maintenance or enlargement. Training commitments, knowledge-basedassets, frameworks and regional testimonials should be key vendor evaluation criteria.Organizations must also look to create dedicated in-house teams and SOA centers of excellence(COEs) to gain expertise and address evolving challenges by taking on the responsibility to supportSOA governance for the entire organization.

Business Impact: SOA will affect all enterprises that deploy IT systems in India. Organizationslooking for innovative and faster ways to develop and deliver solutions will benefit from this. SOA

will also transform how organizations conduct business, especially in terms of being agile enough toaddress changing business requirements. This will also lead to the creation of internal teams, similarto COEs, to address the evolving requirements. The implementation of the first SOA application in abusiness domain will generally be as difficult as (or more difficult than) building the same applicationusing non-SOA designs. Subsequent applications and changes to the initial SOA application will beeasier, faster and less expensive, because they'll leverage the SOA infrastructure and previouslybuilt services.




Sample Vendors: Agile Labs; IBM; ThoughtWorks

Recommended Reading: "Cool Vendors in India, 2012"

"Application Development Market and Vendor Guide Cross-Reference Tool, 2011"



"SOA Overview and Guide to SOA Research"

Power Over Ethernet Plus (IEEE 802.3at)

Analysis By: Naresh Singh

Definition: IEEE 802.3at, commonly referred to as Power Over Ethernet Plus (PoE Plus), wasstandardized in 2009. It provides increased power of up to 25.5 watts to customer premisesequipment, an increase from the existing PoE standard, IEEE 802.3af, which provides 12.95 watts.IEEE 802.3at will be used to power devices that can't be served by 802.3af, such as higher-end802.11n access points (APs) and surveillance cameras, and, potentially, as a power source tocharge mobile devices.

Position and Adoption Speed Justification: As a ratified standard, 802.3at is now common acrossnearly all workgroup Ethernet switch offerings from all major players in the market. The 802.3at isdeployed as a seamless extension to the power capabilities available in 802.3af. So there are no802.3at-specific products — only those that can deliver power up to 25.5 watts, with the switchproviding the appropriate level of power to different devices. Also, many midspan solutions thatprovide PoE Plus outside an Ethernet switch power source are available from various providers.Although advances in energy conservation in electronic components have enabled many devices todraw lower power to operate, new applications, such as multiradio wireless LAN APs, HD-quality TVand video devices, high-end surveillance cameras, and higher-end IP phones, have gone beyondthe 12.95-watt limit imposed by IEEE 802.3af, thereby calling for a PoE Plus-capable power sourceto cater to their higher power demands. Thus, we see 802.3at as a complementary add-on to LANswitches to provide some flexibility and future-proofing in supporting higher-power devices in theenterprise.

A continued gating factor for the 802.3at will be the cost of power facility upgrades in manybuildings, which is a challenge in India. Another concern about 802.3at is higher heat dissipation bythe cabling plant and active devices, compared with the standard PoE. Although the actual andvarying power used by devices and, hence, the facility's overall network power, can be managedwith Link Layer Discovery protocol and Media Endpoint Discovery protocol and other vendor-specific device status management protocols, device support and interoperability challengescontinue to deter wider enterprise implementations and greater user adoption.

Increasingly, PoE Plus in India is reaching users through upgrades and new purchases ofworkgroup switches. Although most endpoints do not require additional power, it is a featurecoming almost by default with newer switching models introduced by vendors, and users arechoosing it to future-proof investments. As the use cases for outdoor wireless APs and HD-videoequipment and surveillance cameras grow, PoE Plus is likely to be increasingly required in the fieldby customers — especially those in the defense, hospitality, manufacturing, retail and educationsegments.

User Advice: All LAN switching vendors will provide PoE Plus support for the same style of devicesusing standard PoE, and allow for configuration selection (manual or through negotiation withendpoints) to determine the level of power delivered (up to 25.5 watts), covering the full range of


PoE and PoE Plus. Many vendors will also offer different amounts of total power to be sharedacross all ports (with optional power supplies). Indian network managers should verify with theirvendors that they are getting PoE Plus-capable switches as part of their new procurement orupgrade. At the same time, they should be careful not to overprovision power supplies, becauseuse of PoE Plus in India will be limited to a very small number of ports on any particular switch inmost use cases. They should conduct their network power planning along with the facilities teamearly in their facilities and network planning, taking into consideration the cabling plant and itslimitations, and the building's overall energy usage, in addition to the per-device power budgetingand management decisions.

Midspan has been a choice among Indian customers needing PoE provisioning without upgradingtheir existing switches. While going for midspan solutions, in the case of legacy networks, ensurethat these comply with the IEEE standards. Understand that any product that promises to deliverbeyond the IEEE-stipulated levels of power stands the risk of noninteroperability with futurestandards and may even include heat dissipation issues affecting the cabling plant in the building,and, thereby, the entire network.

Business Impact: PoE and PoE Plus minimize the need for electrical wires, resulting in easiermaintenance and greater flexibility of installation. PoE and PoE Plus adoption should be undertakenalong with other energy-efficient measures, including network, policy-based options.

Benefit Rating: Low



Sample Vendors: Alcatel-Lucent; Avaya; Brocade; Cisco; HP; Juniper Networks; Microsemi(formerly PowerDsine)

Virtualization

Analysis By: Thomas J. Bittman; Philip Dawson; Naveen Mishra

Definition: Virtualization is the abstraction of IT resources that masks the physical nature andboundaries of those resources from resource users. An IT resource can be a server, a client,storage, networks, applications or OSs. Essentially, any IT building block can potentially beabstracted from resource users.

Position and Adoption Speed Justification: Abstraction enables better flexibility in how differentparts of an IT stack are delivered, thus enabling better efficiency (through consolidation or variableusage) and mobility (shifting which resources are used behind the abstraction interface), and evenalternative sourcing (shifting the service provider behind the abstraction interface, such as in cloudcomputing). A key to virtualization is being able to effectively describe what is required from theresource in an independent, abstracted and standardized manner. In essence, cloud computing isabout abstracting service implementation away from the consumers of the services by usingservice-based interfaces (i.e., the interface for cloud computing services is about virtualization — anabstraction interface). To a provider, virtualization creates the flexibility to deliver resources to meet


service needs in a very flexible, elastic, rapidly changing manner. The tools that make that happencould be virtual machines, virtual LANs (VLANs), or grid/parallel programming.

Virtualization is not simply one technology; rather, it is many technologies that are all evolving atdifferent rates. Virtual machines for servers, for example, were introduced on the mainframe morethan 30 years ago. However, virtual machines for x86 architecture servers were introduced in 2001and, today, are used for more than 50% of all x86 architecture workloads. The x86 architectureserver virtualization is being adopted quickly, however, and is expected to be used by three-quarters of all workloads by 2015. Storage virtualization is relatively mature within storage vendorofferings; originally in homogeneous forms only, there are a growing number of heterogeneousofferings. Networking is extremely mature in terms of virtualization. There are many forms ofvirtualization, and the challenge is choosing which form of virtualization to use. For example, servervirtualization tools tend to dictate how storage and networking will be virtualized. Abstracting aresource usually means commoditizing it. Vendors will not promote an abstraction technology thathides their differentiation, and thus will promote their own virtualization technologies. There aremany technologies and many competing solutions, and not all the technologies are mature yet.

User Advice: The virtualization trend has caused huge turmoil among vendors, threateningcommoditization status and removing the vendor's ability to differentiate and influence buyers.Vendors are focusing on competing for ownership of the virtualization layers and the management/automation tools that work with those virtualization layers. Be cautious about vendors that promoteone technology to virtualize everything. Different technologies will be appropriate for differentsituations. Be cautious about vendors that promote one technology to manage everything. In theend, architectures will include many different virtualization layers, with many different managementmechanisms. Effective tools will work with those different management mechanisms, rather thanreplace them. Virtualization is about much more than technology architecture. Virtualization causescultural and political change. Virtualization projects, therefore, need strong executive support todrive those changes. Finally, virtualization requires processes and management tools tofundamentally change how they work. Processes need to account for speed, agility and granularity,which are very different in virtualized environments. At the highest level, management tools need toshift from managing vertical, tightly integrated silos into managing horizontal resource pools to meetservice needs (leading to new architectures, such as fabric-based infrastructures). Virtualizationprojects that don't have effective management strategies will fail.

Business Impact: Virtualization makes it easier for IT to deliver IT capabilities faster, to have alower barrier to access IT capabilities, and to deliver exactly the right amount of resources needed— no more and no less. This puts more pressure (and opportunity) on the user to use IT efficiently,and to make good business decisions about the use of IT. As an IT catalyst, virtualization can help abusiness adjust to changing market trends faster than before, transforming the business and its useof IT. However, a lubricant used badly can also cause a business to "slip and fall," negativelyaffecting business performance.

Virtualization starts to change the relationship between the enterprise and IT based more on servicelevels, and tracked and perhaps paid based on usage (i.e., not simply as a cost center, but as aninvestment). In many cases, business units will need to adjust to leverage the speed and granularitythat virtualization provides (for example, virtual machines can be deployed roughly 30 times faster


than physical servers, which have a tendency to double demand for servers). That includes makinggood decisions about how many resources to ask for and taking advantage of speed to deploy IT-based solutions much faster to meet the business's needs. Part of an effective virtualizationdeployment requires good usage metering, showback, and where politically feasible, chargeback totreat this more-fluid IT resource as any other business.


Market Penetration: More than 50% of target audience


Sample Vendors: Cisco; Citrix Systems; EMC; HP; IBM; Microsoft; NetApp; Oracle; Parallels; RedHat; VMware

Recommended Reading: "Virtual Machines Will Slow in the Enterprise, Grow in the Cloud"

"The Road Map From Virtualization to Cloud Computing"

"Q&A: The Changing Dynamics of Virtual Machine Density"

"Q&A: Six Misconceptions About Server Virtualization"


Analysis By: Naresh Singh; Joe Skorupa; Ganesh Ramamoorthy

Definition: WAN optimization controllers (WOCs) enable application centralization by mitigatinglatency effects and bandwidth constraints through use of bandwidth utilization algorithms, network-level optimization and other application layer protocol spoofing and optimization techniques thatmay compensate for "lossy" links. Software-based WOCs (softWOCs) provide these benefits toindividual devices. WOCs are also used in data-center-to-data-center WAN links for faster datareplication to support business continuity/disaster recovery (BC/DR) requirements.

Position and Adoption Speed Justification: WOCs continue to evolve and integrate morecommunication functionality required at the branch. Data-reduction algorithms will include a richerset of caching and enterprise content delivery network functionality. WOCs often support guestapplications via an integrated hypervisor, allowing integration of fine-grained monitoring and SLAmanagement, as well as other remote requirements, such as video streaming, DNS, Dynamic HostConfiguration Protocol and security functions. The WOC environment also includes virtual WOCs(WOCs provided as a packaged virtual machine for a particular hypervisor) that buyers can run ontheir choice of hardware and softWOCs that can provide application optimization to individualmobile clients, including smartphones and tablets. This can be particularly useful during periods ofdisruption, including pandemics and natural disasters.

WAN optimization deployment has seen a good uptick and acceptance among Indian users in thelast five years, with a growing need to have greater control and optimization of their WAN resources.However, most users in India continue to address their WAN challenges by upgrading either their


WAN links or the network equipment, believing this will improve performance. Many still don'trealize that their application performance issues are not due to a lack of network bandwidth, butother factors, such as network latency, application protocol inefficiencies and TCP overhead. Wherethere is an understanding of the critical challenges beyond just network uptime or bandwidth, usersoften seek a solution with their network service providers or network monitoring tools. Among thosewho are aware of WOCs, a strong perception of WOC being a costly deployment often becomes abarrier to wider deployment in the enterprise. This also results in point solutions, such as cachingand bandwidth managers, being used in several cases.

As more users deploy centrally hosted applications and consolidate their IT systems into fewer datacenters, the pressure and demand on the network will grow significantly. This is already evident inthe number of inquiries Gartner receives from users, as well as results of user surveys. As Indianenterprises continue with their key IT initiatives, WOCs will strike the right chord in deriving the bestvalue from current and future network investments. However, the initial cost of deploying WOCsacross data centers and branch and remote sites will remain an inhibitor among small or midsizebusinesses (SMBs). This could translate into opportunities for less-expensive alternatives, such asvirtual WOCs and softWOCs, in the case of very small remote sites with shared clients.

User Advice: WOC technology continues to improve. Organizations in India looking to consolidatebranch office/remote servers, applications and desktops or to deal with real-time applications, suchas video, collaboration and storage traffic, should consider WOCs as a way of dealing with theirnetwork optimization requirements. Organizations should also consider softWOCs as part of theirBC/DR strategy.

WOCs can be expensive for smaller locations, although sub-$1,000 devices are emerging, as arecost-effective WAN optimization managed services. Implementing WOC solutions in complexnetworks that employ techniques like asymmetrical routing, mesh forwarding and deep-inspectionfirewalls can be complicated. When WOCs enable server centralization, loss of the WAN link resultsin loss of access to applications and other centralized services. As a result, redundant WAN links,often deployed with link-load balancing or a local instance of business-critical applications, may berequired.

Business Impact: WOCs enable consolidation of infrastructures and improved compliance throughcentralization of data. They can also reduce WAN bandwidth cost, while delivering significant gainsin application and data replication performance. Although penetration in the SMB segment hasbeen limited, new service-based offerings promise to open this market. SoftWOCs also enable themobile workforce to have optimal access to applications over a WAN, potentially boostingemployee productivity and access to information.




Sample Vendors: Blue Coat Systems; Cisco; Citrix Systems; Riverbed Networks; Silver Peak


Recommended Reading: "Magic Quadrant for WAN Optimization Controllers"



Definition: Internet Protocol (IP) telephony involves the transmission of voice conversations overpacket-switched IP data networks, such as private LANs, WANs and intranets, instead of circuit-switched facilities. More specifically, IP telephony is replacing the use of time division multiplexing(TDM) hardware-based PBX, key telephone system and Centrex platforms to deliver and supportcall-processing functionality and features such as call setup and teardown, hold, forward, mute andtransfer.

Position and Adoption Speed Justification: IP telephony as a technology area is mature enoughfor enterprise implementation, and many enterprises (for example, IT and IT-enabled services andbanking, financial services and insurance enterprises) have already deployed IP telephony in India.However, IP telephony adoption in India still lags behind mature markets, such as North America,Western Europe and Australia, for many reasons. Enterprisewide implementations help in thereplacement of multiple, traditional PBX systems with a single IP telephony application that spansall users across all sites, or a mix of IP phone and TDM handsets using a single IP-capable system.Business justification of IP telephony includes: (1) centrally managed communication infrastructure;(2) reduced maintenance costs associated with keeping outdated legacy equipment running; and (3)investment as part of broader future unified communications (UC) investment plans.

Enterprises in India are more proactively considering making new investments and upgrading theircommunications infrastructure. However, enterprises are often slow in deciding to invest in theircommunications infrastructure for the following reasons: the extended life cycle of the existingtraditional PBX system; the cost associated with getting the network ready to support IP; the pricedifference between the TDM and IP telephony; and the regulatory restrictions for theinterconnection between a closed user group (CUG) and the public switch telephony network(PSTN).

User Advice: Enterprises should align IP telephony implementations with their broader future UCinvestment plans. Functional and cost-benefits can be derived from IP telephony (particularly UCintegration); hence, enterprises in India should run trials of the technology and define requirementsto build the appropriate business cases and deployment plans for implementation throughout theorganization. Implementations should be completed within the next three to five years in"greenfield" projects. When selecting a system integrator (SI), enterprises should evaluate the SI'sIP telephony implementation capabilities, and enterprises must demand the IP telephony customerreferences from India. Enterprises should undertake voice-over-IP readiness evaluation todetermine the infrastructure upgrade requirements.

Business Impact: Before deployment of an IP telephony solution, the ability of the data network tohandle voice and video traffic in its switches and routers must be assessed. Also, the cost ofupgrading the data network to handle voice, if required, should be considered. Voice quality, trafficcongestion and provisioning quality of service for voice can be challenging for any organization, butit can be overcome by proper planning and design. Addressing the security implications of IP


telephony systems — hacking of endpoints, denial of service and other security-related issues —should also be an early part of any system evaluation. Many benefits will be associated with thelocation-independent nature of IP technology, which facilitates user access to the enterprisenetwork, and system management over virtually any broadband connection.



Maturity: Mature mainstream

Sample Vendors: Aastra Technologies; Alcatel-Lucent; Avaya; Cisco; NEC; Siemens EnterpriseCommunications

Recommended Reading: "Magic Quadrant for Corporate Telephony"

"Enterprise IP Telephony Infrastructure: Evaluation Criteria"

"Critical Capabilities for Corporate Telephony"

"Preparing Your Network for IP Telephony"

Appendixes


Figure 3. Hype Cycle for ICT in India, 2011

Technology Trigger

Peak ofInflated

Expectations

Trough of Disillusionment Slope of Enlightenment

Plateau of Productivity

time

expectations

Years to mainstream adoption:

less than 2 years 2 to 5 years 5 to 10 years more than 10 yearsobsoletebefore plateau

As of July 2011


Cloud-Driven Business and IT Services


Infrastructure as a ServiceServer Power Capping

Media Tablets

COBITData Center Bridging

Fabric-Based InfrastructureSolar Energy Technology

Knowledge Process Outsourcing


Cloud ComputingMobile OTA Payment

IT Outsourcing Infrastructure Services

Unified Communications in IndiaVM Energy Management Tools

Business Process Management SuitesMobile AdvertisingMobile Application StoresOpen-Source Development and Integration Tools in IndiaIT Infrastructure Library

Advanced Server Energy Monitoring Tools

Video Telepresence


PoE Plus (IEEE 802.3at)

CFD Analysis

Data Deduplication

PLM-Based Team

Collaboration

Mini-notebooks


CRMSCMService-Oriented Architecture


Comprehensive F&A BPOx86 Server Virtualization

WAN Optimization ServicesThin Provisioning

Blade ServersWAN Optimization Controllers


ERP"Big Data" and Extreme Information

Processing and Management



Hype Cycle Phases, Benefit Ratings and Maturity Levels

Table 1. Hype Cycle Phases

Phase Definition

Technology Trigger A breakthrough, public demonstration, product launch or other event generatessignificant press and industry interest.

Peak of InflatedExpectations

During this phase of overenthusiasm and unrealistic projections, a flurry of well-publicized activity by technology leaders results in some successes, but morefailures, as the technology is pushed to its limits. The only enterprises makingmoney are conference organizers and magazine publishers.

Trough ofDisillusionment

Because the technology does not live up to its overinflated expectations, it rapidlybecomes unfashionable. Media interest wanes, except for a few cautionary tales.

Slope ofEnlightenment

Focused experimentation and solid hard work by an increasingly diverse range oforganizations lead to a true understanding of the technology's applicability, risksand benefits. Commercial off-the-shelf methodologies and tools ease thedevelopment process.

Plateau ofProductivity

The real-world benefits of the technology are demonstrated and accepted. Toolsand methodologies are increasingly stable as they enter their second and thirdgenerations. Growing numbers of organizations feel comfortable with the reducedlevel of risk; the rapid growth phase of adoption begins. Approximately 20% ofthe technology's target audience has adopted or is adopting the technology as itenters this phase.

Years to MainstreamAdoption

The time required for the technology to reach the Plateau of Productivity.



Table 2. Benefit Ratings

Benefit Rating Definition

Transformational Enables new ways of doing business across industries that will result in major shifts inindustry dynamics

High Enables new ways of performing horizontal or vertical processes that will result insignificantly increased revenue or cost savings for an enterprise

Moderate Provides incremental improvements to established processes that will result inincreased revenue or cost savings for an enterprise

Low Slightly improves processes (for example, improved user experience) that will bedifficult to translate into increased revenue or cost savings


Table 3. Maturity Levels

Maturity Level Status Products/Vendors

Embryonic ■ In labs ■ None

Emerging ■ Commercialization by vendorsPilots and deployments by industry leaders

■ First generationHigh priceMuch customization

Adolescent ■ Maturing technology capabilities and processunderstandingUptake beyond early adopters

■ Second generationLess customization

Early mainstream ■ Proven technologyVendors, technology and adoption rapidlyevolving

■ Third generationMore out of boxMethodologies

Maturemainstream

■ Robust technologyNot much evolution in vendors or technology

■ Several dominant vendors

Legacy ■ Not appropriate for new developmentsCost of migration constrains replacement

■ Maintenance revenue focus

Obsolete ■ Rarely used ■ Used/resale market only



Recommended ReadingSome documents may not be available as part of your current Gartner subscription.

"Understanding Gartner's Hype Cycles, 2012"

"Cool Vendors in India, 2012"

"Enterprise Architecture Priorities in China and India, 2012-2013"

"Competitive Landscape: India-Based Remote Infrastructure Management Service Providers"


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