Digital Home is Elusive
Connectivity: According to the Telecom Regulatory Authority of India (TRAI), the overall Internet subscriber base has grown at around 45% over the previous year and stood at nearly 7.7 mn in June 2006. IDC expects the Internet subscriber base to grow at 50% in 2007, with broadband subscribers accounting for 30% of the total. Thus, the number of broadband subscribers can be expected to touch around 3.6 mn by June 2007, and cross 5 mn by December 2007. Even though bandwidth tariffs have come down significantly and bandwidth availability improving, the high total cost of ownership (TCO) for a broadband subscription will not permit the 9 mn Internet subscriber-mark to be reached in 2007. On the other hand, the mobile subscriber base in India is expected to cross 220 mn by December 2007.

Content: In 2007, service providers, content companies (media, news, gaming, services) and device manufacturers are expected to team up in a big way to provide services like IPTV, online music, online gaming, online banking, online shopping, and other public utility services.

Convergence: The lapping up of more and more lifestyle and entertainment IT products such as multimedia desktops, notebooks, mobile phones, MP3/DVD players, digital cameras, and broadband connections would accelerate the establishment of a wider ecosystem of digital entertainment/lifestyle IT stores, e-zones in shopping malls, local digital photography bureaus, DVD rental chains etc. These developments around the three themes of connectivity, content, and convergence will accentuate and define the lines around which the digital home of the future will emerge.

Productized Services
To standardize or to achieve 75% repeatability of services deliverables has always been a sought after objective for IT services vendors. The major pain point of SI vendors remains consistent and quality delivery of IT services across diverse customer sets. As the market evolves, vendors are aiming to achieve greater standardization in terms of their services offerings.

The next level of maturity would come from the conversion of services into standalone standard products/modules. Delivery of these productized services will continue to be based on fixed service-level agreements (SLAs) between the primary vendor and the end customer.

The focus of this new productized services strategy will be on midsized enterprises, which require speedy implementations with a reasonable return on their IT investments within a stipulated time-frame. Vendors like IBM have already come to market with such offerings. TCS, Wipro and HP are expected to follow suit in 2007.

The market spending on SI services in India for 2007 is expected to be around $872 mn growing at 19% and contributing to 21% of the total IT services market. This change in the delivery model will not have a huge impact on spending, but will definitely improve vendor earnings and client confidence.

Internal Security Concerns
Until recently, enterprise networks were bounded, users were internal and there were isolated islands of IT infrastructure. Therefore, enterprises deployed only perimeter security to protect their assets. And security was all about anti-virus solutions, and at best a firewall.

However, IT managers and experts have realized that enterprise-wide security is not a one-time activity, rather it needs to be continually evolved by pro-actively visualizing and nullifying future threats and intimidations. Thus, security is slowly moving towards the concept of end-to-end security, closely and intimately integrated to the business processes of an organization.

With changing nature of threats being faced, organizations need to lay equally strong emphasis on all the three critical elements of business, ie, people, process and technology.

The year 2007 will witness enterprises defining their internal processes in detail, and having proper policies in place to protect the core business operation.

The identity and access management (IAM) market will continue to grow at 31% in 2007. Security solution vendors will focus on management and optimization of their offerings and developing an ecosystem of partners to provide deeper services, and help their customers manage their security environment.

Security vendors will focus on pro-active security with strong focus on manageability and an integrated view of the whole security environment. Process automation, workflow and information management vendors will strengthen their security offerings. New vendors are also looking for this space.

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