Reading - IT LEAVES

Since 2001 however, the local animal that is the market has become far less predictable.

iWeek spoke to some of the leading vendors and analysts for their perspective on 2005`s biggest shifts, and their thoughts on the most likely hot topics for 2006.

THE ICT CHARTER

Undoubtedly one of the hottest during SA`s decade of democracy, say both Stewart van Graan, country manager of Dell South Africa, and Thoko Mokgosi-Mwantembe, his HP counterpart, is the formalisation of the ICT Charter.

While the Charter is not finalised yet, van Graan says the formalisation process is key from the perspective of providing South African (and foreign) businesses with clarity.

"It`s key for companies to be sure of the business environment they will be operating in," he says, "since a lack of clarity in this regard can be unsettling.

"What has been massively encouraging during this process," he continues, "is seeing companies moving forward with their transformational efforts in the background, regardless of the final outcome of the Charter.

"The lack of clarity, in many regards, hasn`t stopped the market from carrying on with social development, skills development, social investment, educational and other transformational efforts," he maintains.

"My wish for 2006 is that this clarity [finally] does make an appearance, and that this in turn results in a blending and harmonisation of the different industry-specific charters being developed in the market."

COLLABORATION ON THE CHARTER

Mokgosi-Mwantembe says in her opinion, the way companies do business once the Charter is finalised will change dramatically. "I believe that companies will begin doing things differently and that there will be significant impact on business models," she says. "While many companies, including the various multinationals in the country, have been focusing on the classic seven pillars of empowerment, the Charter will streamline those efforts and bring some true order to the ranks.

"Take skills development, for example," she continues. "Many companies are involved in skills development, but few are working together.

"At a macro level, I see companies coming together to bridge the gaps that each has in its arsenal, so to speak. The winners will be those that can provide South African skills to export to the world.

"In 2006, I see greater collaboration taking place between government, the private sector and the education space. All these parties need to come together in order to identify the neglected niches in the market and use their combined efforts to bridge them," she opines.

CHANGING TELCO ENVIRONMENT

As regards vertical business trends that have affected the market over the past year, Willie Appel, vice-president and programme director for executive programmes at Gartner, says there has been a major shift in the telecoms environment.

"More and more South African users are beginning to use mobile phones (some use smartphones) as their only communications device, causing a seismic shift in the sector from wired to wireless.

"This trend will increase as young people in developed markets (traditionally a highly mobile arena) mature and make telecom decisions, and as developing markets continue to prefer wireless to wired connections," he says.

"The impact of this will be that local organisations will be forced to rethink their customer channel strategies, forcing them to invest not only in wireless technologies, but also to become effective in delivering standard services across the mobile/wireless channel," Appel explains.

MERGERS AND ACQUISITIONS

One of the interesting events of 2005, says Irnest Kaplan, managing director of Kaplan Equity Analysts, is the recent offer Venfin received from Vodafone for its shares in Vodacom.

"That offer for 15% of Vodacom says something very interesting," Kaplan opines. "From an investment perspective, mobile operators in Africa are being valued much higher than ever before - I would venture anywhere between 20% and 40% higher than what the consensus view was before.

"It shows that the mobile operators in Europe are struggling for growth, since they`re operating in a saturated market. They now have started looking to other continents and more specifically India, China and other Asian countries and obviously Africa, since these areas have the highest predicted growth over the next five years.

"The investments will continue going forward and it`s because the European operators are trying to get a foothold in these markets today," he says.

CONVERGENCE OF COMPETENCY

On an entirely different topic, but still focused on acquisitions, Kaplan says the South African market will see a dramatic shift from large operators like Telkom.

"BCX recently put out a cautionary announcement that stated it was in talks with numerous bidders. Telkom has also released a cautionary to state that it is in fact one of those bidders.

"While this is speculative, should an acquisition of BCX by Telkom take place, the potential in the future for converged services is massive, even though BCX is miniscule compared to Telkom.

"Where BCX is mainly an outsourced IT shop specialist, Telkom provides voice and data services to the South African market. Mix the two and converge those two sets of offerings, and in a year`s time, I believe there will not be a clearly delineated telco known as Telkom and a clearly delineated IT company known as BCX. There will a one-stop infrastructure and outsourcing/services shop," he says.

Even if the deal doesn`t happen, Kaplan says, Telkom will either buy someone else or get into that business themselves. "They`ve shown a clear intention to do so," he adds.

This is particularly significant since companies in BCX`s market space will jostle for space with a company with far larger capital, reach and economies of scale. It could take them out of the market. "This is one trend that has happened almost identically elsewhere in the world," he says.

RESPONSIBILITY SHIFTS

Mike Cathie, business and marketing officer at Microsoft South Africa, says looking forward to 2006 the move to convergence and increased interoperability will continue, but the responsibility for interoperability will shift from the back-end of the organisation (where the IT professional resides) to the front-end.

"One of the main ways business leadership is trying to extract more value out of their businesses for shareholders is to focus on the time value of resource. Time wasted by employees translates into reduced productivity. Productivity is becoming a key issue, as opposed to infrastructure and management.

"I believe there will be increasing pressure placed on all parts of the business to deliver increased interoperability, and therein, increased productivity.

"We will also continue to see increased pressure and focus placed on privacy and security. The former will outpace the latter in my opinion. Although many businesses have not yet addressed their security issues, the ECT Act will drive them to address the privacy angle from a legislative and compliance perspective first, and then address their security," he says.

GRID GAMES

Ending things on a fun note, IBM`s country marketing executive for South Africa, Dave Botha, says one of the most important trends IBM sees in 2006 is in the area of online gaming.

"Using grid computing to implement the largest virtual computing system on the planet will enable the hottest applications in online gaming. Essentially IBM`s On Demand strategy is the only sensible option we see to enable this new breed of online applications, of which gaming is but the start." It`s not just games that will benefit from grid computing, however.

"Using your computer while it is idle becomes part of a grid and allows applications to understand and process data in a secure, safe environment. Log on to www.worldcommunitygrid.com to find out more and participate," he concludes.