2009 Predictions for the Anywhere Economy: Reloaded

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. July 20092009 Predictions for the Anywhere Economy: Reloaded© Copyright 2009. Yankee Group Research, Inc. All rights reserved. www.yankeegroup.com

2009 Predictions for the Anywhere Economy: Reloaded

July 28, 2009

Christopher Collins, Senior Analyst

Phil Hochmuth, Senior Analyst

David Vorhaus, Senior Analyst

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. July 20092009 Predictions for the Anywhere Economy: Reloaded

Agenda

• Macrotrends of 2009’s Second Act

• 2009 PredictionsReloaded

• Summary and Conclusions

• Q&A


Macrotrends of 2009’s Second Act

In light of these trends, our predictions from Decemberhave evolved at a rapid pace.

The economic crisis appears to have bottomed out.

Communications spending is expected to tick up at the beginning of 2010.

The transition from product to service continues undeterred.

Consumerization of the enterprise soldiers on.


Agenda

• Macrotrends of the Year’sSecond Act

• 2009 Predictions Reloaded


• Q&A


Premium brands will lose market share

Consumers will demonstrate continued vigilance but spending on connectivity should stabilize in 2H 2009

• Spending overall on communication products and services is surprisingly resilient

• Nonetheless, consumers are behaving differently


Cord-cutters will emerge from the economic mist

Large-scale cannibalization of broadband lines will become a reality when mobile alternatives are acceptable to consumers on the basis of performance, reliability and price

• A dramatic shift in consumer behavior has not yet materialized

• There is strong evidence of usage substitution and indications that receptivity to cord-cutting is increasing


• Enterprises continue to seek zero-capex solutions• Large enterprises remain cautious about embracing IaaS and

PaaS deployments wholeheartedly

Cost-sensitive SMBs will be more likely to deploy IaaS for affordable disaster recovery than large corporations

Sunny skies are ahead for cloud computing


Desktop virtualization will replace PC replacement

Enterprise penetration of VDI will deepen as businesses realize the associated cost savings and spread the technology beyond the traditional desk-bound task worker

• The number of enterprises deploying VDI technology is growing dramatically


Two of the eight global network equipment manufacturers will be forced out of major markets

It is unlikely that another one of the major players will collapse in the same fashion as Nortel within the calendar year

• Nortel files for Chapter 11 bankruptcy protection in January• Alcatel-Lucent, Ericsson and Nokia Siemens have been

resilient in 1H despite decreased service provider capexspending


Subsidies on smartphones will strangle operator profits

Tier 1 operators will continue to use subsidies, but the outstanding growth of no-contract plans and legal pressure on the subsidy model threaten to reverse this trend

• Subsidies remain a powerful customer acquisition tool and continue to prop up sales of high-end devices

• Nonetheless, subsidies are having a devastating effect on operator profitability


Agenda

• Macro Trends of the Year’s Second Act



• Q&A


2009 Predictions Summary

• Premium brands will lose marketshare• Cord cutters will emerge from the economic mist• Sunny skies for cloud computing• Desktop virtualization will replace PC replacement• Two of the eight global network equipment manufacturers will be forced

out of major markets• Subsidies on smartphones will strangle operator profits • Wired switch port sales will decline for the first time in history • Video enabled business processes will be born in 2009• Door will close to open access devices in 2009• Point network software solutions will miss the mark

Want to see the predictions reloaded? Read our new report,“Yankee Group’s 2009 Predictions… Reloaded”


Conclusions

• Spending is still growing . . . in very specific ways.

• Customers are demanding greater flexibility, lower costs and higher-touch services.

• The desire for communications technology innovation remains, but the commitment is lacking.

While we haven’t come full circle yet, there’s light at the end of the tunnel.


Agenda

• Macro Trends of the Year’s Second Act



• Q&A


Additional resources

• Yankee Group Research Reports:• Mobile Feels the Recessionary Chill by Declan Lonergan• Bundle Up for Broadband Cord Cutters by Andy Castonguay• Providers Must Clear Security Uncertainty in the Cloud by Agatha

Poon and Phil Hochmuth• Desktop Virtualization Tames Endpoints Gone Wild by Phil Hochmuth• Yankee Group’s Globel Telecommunications Capex Forecast by Brian

Partridge and David Vorhaus• The Golden Subsidy Egg’s Goose Is Cooked: Welcome to the Brave

New Subsidy-Free World (forthcoming) by Andy CastonguayDownload the reports at http://www.yankeegroup.com


Christopher Collins, Senior Analyst, [email protected]

Phil Hochmuth, Senior Analyst, [email protected]

David Vorhaus, Senior Analyst, [email protected]

Next Yankee Group webinar:Getting Consumers’ Attention with Anywhere MediaAugust 25, 2009

Thank you!

2009 Predictions for the Anywhere Economy: Reloaded

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