Green IT: The Road Ahead

Manish Bahl

Manager – Emerging Markets & Custom Research

Interop Mumbai 2009

2

Agenda

Introduction

Asia Pacific IT Electricity Expenditure (2007-2012)

Taxonomy

Green IT Services Market in 2008 & 2009

Green IT Survey Findings – India

Green IT Trends

Top Five Predictions

Conclusion

3

Green IT’s Perfect Storm

Social Awareness at Highest-ever Levels

Rising Global Energy Costs

Govt. Changes & Growing Regulatory Momentum

4

Asia Pacific IT Electricity Expenditure (US$M)

– 2007 to 2012

2007 2012

US$ Share US$ Share CAGR

(07-12)

Large Enterprises (>1000 Employees)

Servers 544 11% 2,061 14% 30.5%

Other Data Center Equipment 360 7% 950 7% 21.4%

Server-Related (Cooling, UPS, etc.) 468 9% 1,278 9% 22.3%

Distributed & Employee IT 768 15% 1,512 11% 14.5%

Consumers & SME Enterprises

SOHO & SME Enterprises 1,320 26% 3,344 23% 20.4%

Consumer IT 1,690 33% 5,148 36% 25.0%

Total 5,150 100% 14,293 100% 22.6%

Source: Springboard Research

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Green IT Taxonomy:“..a broad term comprising environment friendly technologies and processes

employed during the manufacture, distribution, use and disposal of IT products.”

Manufacture (Including Design, Production)

Distribution

Use

Disposal

Use of rare resources

Toxic materials

Deadly gases

Water use and pollution

Energy consumption

Waste

Fuel for transportation

Travel/Sales

Packaging

Brochures/Manuals

Promotion

Energy consumption

Wastage

Heat generation

Power conversions

Cooling

E-Waste clogging landfills

Non bio-degradable

Rapid obsolescence

Re-use/Recover

Churn mentality

Large sizes, large volumes

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Asia Pacific Green IT Services Market –

2009

Source: Springboard Research

Green IT Survey Findings - India

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Green IT Strategy in Place - India

Q: Does your company have a Green IT strategy in

place?

Source: Springboard Research, 2009

Key Takeaways :

– Majority of companies have not deployed Green IT strategies because they couldn't find a suitable solution for their company

– Also, companies felt that “there was no need for it”and they had more important priorities

– Results indicate that 11% of companies “do not know how or where to begin” with regards to Green IT

– Funding limitations prohibited only 9% of respondents from Green IT implementation

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Key Drivers for Green IT Investment - India

Q: What is the primary reason your organization implemented a Green IT strategy?

Source: Springboard Research, 2009

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Green IT Implementations - India

Q: Which of the following green IT initiatives have you implemented?

Source: Springboard Research, 2009

Key Takeaways:

– Organizations are not simply implementing one or two green business practices, but rather introducing a plethora of green initiatives

– Majority of companies who have implemented Green IT strategies have initiated general power saving policies, like adjusting the setting for PCs in idle mode

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Measurement and Monitoring Carbon

Footprint - India

Q: Does your organization measure and monitor its carbon footprint?

Source: Springboard Research, 2009

Key Takeaway :

– Even among organizations that have implemented Green IT strategies, ~65% do not monitor their carbon footprints

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Future Green IT Initiatives - India

Q: Do you expect your organization to implement a green IT

strategy within the next 24 months?

Source: Springboard Research, 2009

Key Takeaway

– Among all the countries, India will be a key country to target, as 88% of organizations expressed interest in formalizing a Green IT strategy in the next 24 months

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Green IT Initiatives

Time

Virtualization

&

Consolidation

+

-

2008

Green

Procurement

Data Center

Design

Storage

Options

Thin

Power

Management

Features

SaaS

Recycling

& Disposal

Policies

Outsourcing

Cost/Difficulty

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Constraints to the Adoption of Green IT

Lack of Awareness– These issues are only now starting to resonate with IT managers

Energy Costs Hidden and Imprecise Energy Overhead Allocations– Most CIOs and IT management have no clue how much energy their operations are

consuming or the carbon footprint of their organization

Cost– All change costs money now, even if there are savings to be had downstream

Cultural Barriers & Habit– IT organizations are resistant to any change unless it is critical, do not like to take risks and

are comfortable with the familiar

Complex Specifications– Confusion is always a good excuse for procrastination. The industry needs the equivalent

of MPG and L/100kmh

Lack of Skill Expertise to Drive Green IT Theme– There is a lack of consensus on where IT professionals can turn for expert advice on green

issues

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Green IT Trends – Before and After

2008 2011

Curiosity Mainstream

Few Majority

Growing interest Intense

Only if save $$ CSR Required

Some Many

None Some

Green IT

Customers demand GreenInvestors seek Green

Boardroom view

Green Regulations

Green Taxes

Green Assessment/Audits Few Many

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Top Five Predictions for Green IT

Cost Savings will Continue to Drive Green IT Investments

IT providers to develop end-to-end capabilities and move away from narrow set of capabilities

Strong Growth in Virtualization and Consolidation

Equipment Take-back & Disposal Programs become Imperative

Global Economic Slowdown will Play Only a Limited Role in Delaying Green IT Initiatives

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Conclusion

Green IT is the dominant IT trend of 2009, and we are at the beginning of a

very long and important industry transition– Organizations are starting to recognize that green strategies and technologies can improve their

operational management, reduce costs, support business growth and help the environment

Green IT makes good business sense, which will drive early adoption; in

time, it will be a requirement– Two or three years down the road, the competitive landscape is set to change as organizations permit

green credentials and marketing campaigns to start influencing purchasing decisions to a larger extent

Virtualization, server consolidation and recycling will provide greater

opportunities around Green IT theme:– Small businesses are likely to go green by choosing EnergyStar rated appliances, low power consuming

electronics, blade servers and virtualization technologies, while large enterprises could look for server

consolidation and adoption of other advanced technologies

There is a need for IT vendors to work together with the government to

ensure that regulation on Green IT is realistic and takes advantage of what

IT can offer as a broad tool to reduce enterprises’ environmental footprint