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Don Ryan

Recent Posts

CMB Tech Pulse: Netbooks Will See New life in the B2B Market

Posted by Don Ryan

Wed, Jun 23, 2010

The mobile computing market is abuzz with Apple announcing yesterday they have sold 3 million iPads in just 80 days, Google's press conference today on Droid X and the shipment of the iPhone 4. With each release devices are getting smaller (well maybe not the Droid X), faster and smarter.  Prices are also dropping as the competition continues to heat up.  Smartphones, which were once just used by the business traveler are much more mainstream and now marketed to consumers thanks to the iPhone and Verizon's buy one get one free promotions.

So with all these changes to the mobile landscape we thought we would ask both consumers and our own IT decision maker panel to find out if they plan to swap one device for another. (See today's press release on the findings)
Netbook market research

What we found was that businesses were more open to swapping out one computing platform for another than consumers.  The biggest drivers for making the switch were not surprisingly cost and form factor, but what was a bit surprising was that close to twice as many IT decision makers than consumers are willing to ditch the notebook for a netbook the next time around. The netbook, which started out as a low cost computer targeted at consumers is seeing new life and new opportunity in the B2B market. 

There has been a lot of hype around the iPad killing the netbook, but netbooks will see new life in the B2B market as long as manufactures research, recognize and capitalize on these shifts in the mobile market.

Posted by Don Ryan. Don is a senior consultant for CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, mobile, Consumer Pulse

Netbook Summit Round Up- Lots of Changes on the Horizon

Posted by Don Ryan

Sun, Jun 06, 2010

CMB was a sponsor of the First Annual Netbook Summit conference held in Burlingame, CA last week. As part of the conference I was on three panels covering future device directions, platform substitution and competitive developments. In listening to the panel discussions and talking with other industry insiders there was unanimous consensus that there is a future for netbooks, but that their dimensions, uses and features will evolve.  Netbooks will also have to share the spotlight with tablets and smartphones for a share of wallet for both business and consumer users.

Indeed more than one analyst predicted the availability of the $100 tablet in the next year ushering in a whole new pricing threshold for client devices.

One thing everyone agreed on was that there will be greater fragmentation of the client device market. Intel will slowly lose its monopoly on netbook processors to Nvidia and AMD and alternatives to Windows 7 will drive new paradigms for the user experience. In a nutshell, look for more choice, lower prices and expanded use as devices, applications and operating systems are matched more precisely to specific user needs.

Download Don's presentation on Netbooks in the B2B Market

Posted by Don Ryan. Don is a senior consultant for CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, mobile, conference recap

Consumerization of IT, 18-24 Year Olds Lead the Charge

Posted by Don Ryan

Wed, May 26, 2010

Last week I blogged about what consumers had to say about their electronics spending and looked specifically at netbooks. This week I want to share some other interesting findings- consumer perceptions and usage of technology and how this plays into the growing trend of the consumerization of IT.

We continue to see the lines between consumer technology and business technology become more and more blended.  Of the 1200+ US consumers we surveyed, 29% believed that innovation in business will be led by consumer technologies. This underscores the rapid pace at which consumer technology is progressing and the increasing rate at which people bring it into all aspects of their lives to increase productivity.  We have been watching the trend of consumerization of IT gain more momentum over the last few years. More and more consumers are using technology to increase productivity in their personal lives and have increased expectations for technology to do the same in their professional lives.  This is especially true for 18-24 year olds who tend to be more excited about technology in general.

Even in a down economy 36% of 18 to 24 year olds say they are spending the same amount or more on technology over the last 12 months and are about 10 percentage points higher on excitement for almost all categories (4G adoption, 3DTV, etc).  While this is not shocking, their impact as they join the workforce could have significant implications for technology providers and employers in general.  Expectations and requirements for company supplied devices will likely be higher and the ability for young people to use their own devices may turn into a competitive advantage.   

Posted by Don Ryan. Don is a senior consultant for CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, mobile, Consumer Pulse

CMB Research Takes a Closer Look at Electronics Spending

Posted by Don Ryan

Thu, May 20, 2010

Next week I am speaking on several panels at the Netbook Summit in San Francisco. To prepare for the event I wanted to take another look at how consumer spending has changed in recent months and the impact of those changes on the purchase of electronics, specifically netbooks. We launched a CMB Consumer Pulse study and looked at the responses of 1200 US consumers ages 18-65.

Consumers say they have permanently changed their spending habits and are looking for lower cost alternatives. They also report they may never go back to their old spending habits; this will be an interesting trend to watch.  Roughly 50% of consumers are continuing to spend on electronics, but spending less and 19% have moved to lower cost alternatives.

Netbooks have achieved fast penetration in the consumer market. The question now is do they get stuck at 10% penetration and be overtaken by tablets as the next big device. Widespread device penetration is usually measured in the 40% to 50% range. Price and cost considerations are still drivers of the netbook market, however, 23% of netbook users say they will substitute for tablets and another 24% for notebooks for their next purchase.  Indeed, netbooks have the lowest repurchase rate of all devices.  Expect netbook sales to remain strong, but do not expect to see the historical year over year growth rates. An improving economy may work against their value proposition, given that price and generic capability like connectivity options are driving adoption.

Posted by Don Ryan. Don is a senior consultant for CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, Consumer Pulse, retail research

HP's Acquisition Of Palm Isn't About Depth But Breadth

Posted by Don Ryan

Wed, May 05, 2010

Not only does HP continue to acquire companies whose time is running out, but they are also extending their product lines to offer their customers more. 3Com may not have been the first networking company one would choose to acquire, but it did fill in gaps from HP's Procurve business. Similarly, Palm complements HP's iPaq phone line (new OS, touch screen technology, etc). What HP is showing is that an acquisition does not have to be the best, but rather it needs to provide more scope within a growing market and new technology platforms from which they can build new products.

In fact, the HP acquisition may not be as much about the smartphone business as it is about other mobile devices like netbooks and tablets.  There's no question about the importance of developing Web OS applications for all mobile devices. (See WSJ article for acquisition analysis). 

In a recent Bloomberg News interview with Michael Cuggino, portfolio manager for The Permanent Portfolio based in San Francisco, he talks about the Palm acquisition being about much more than the smartphone business and thinks maybe HP can "unlock the real value of the Web OS and fill a hole in their product line." Cuggino also talks about the importance becoming an integrated entity and the breadth of product lines...

In the mobile device space it is becoming table stakes to have a full product line that spans device types, user interfaces and operating systems. The importance of having a robust product line is consistent with technology research CMB recently conducted on consumer electronic device preference and usage. One of the things we asked among a group of approximately 700 US consumers was which device would you replace your current device with when you make a new purchase.

What we found is that there is a fair amount of substitution especially between netbooks and notebooks and tablets and netbooks. Not surprisingly, most smartphone users would likely replace their existing smartphones with a new smartphone, but we did see that 15% will say they will replace their smartphone with either a tablet or netbook.

These shifts underscore the importance of a vendor having a full line of products to maintain overall device market share as consumers switch from one device to another. What HP has recognized is that it is not as critical what the brand is that they acquired, but rather having a new brand in the first place that offers consumers a viable choice when they do decide to switch.

I will presenting more of these findings at the Netbook Summit taking place May 24th- 25th in San Francisco. We hope to see you there!

Posted by Don Ryan. Don is a senior consultant for CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, product development, mobile

Tech Pulse: Are Enterprise Software Companies a Thing of the Past?

Posted by Don Ryan

Thu, Apr 15, 2010

An article recently in Information Week caught my interest. Titled Global CIO: Oracle, SAP, And The End Of Enterprise Software Companies, it underscores the shift in thinking from the enterprise line of business and from IT executives on all enterprise applications. I would argue that heavy lift application implementation is increasingly becoming an anomaly due to difficult implementation and high investment cost.  To quote Bob Evans from Information Week in the article:  "It also means the days of big, blunt, mega-purchases of software are for the most part behind us--and for SAP and Oracle to continue to grow, they therefore need to step aggressively into new revenue streams other than software to keep investors happy." 

The recession has fundamentally and forever changed the way enterprises will acquire applications and for that matter many other parts of their IT infrastructure. What has saved the server business in the near term is the dramatic ten-fold increase in cost per processing unit productivity due to lower server prices, virtualization and improved processing power.  Although, I think the long term outlook holds marginal upside for on premise servers given the rapid deployment of in-house and cloud computing.  

No cost savings breakthroughs in delivery have taken place or are foreseen for legacy enterprise applications.  Conversely, web based, cloud delivered applications have a strong value proposition based on cost savings and administration efficiencies. The following chart summarizes the relative position of specific vendors based on recent research which CMB did with enterprise IT managers.  Not surprisingly, some of the newer entrants like Google and Salesforce.com have a place in the more favorable quadrant.

This shift to applications through a services delivery model and the increasingly important role of implementation and management services through integrators, managed service providers and VARs will take place faster not slower than people think. A sea change among IT executives has already happened on acquisition and management of applications. The great news for application providers is that their core business benefit and functionality can be provided through these new delivery platforms and the vendors can still profit and thrive by adopting these new variable cost business models. The only question is which legacy companies can take the lead to acquire first mover status? In my mind the jury is still out.

To learn more download the full CMB Tech Pulse Report: Shifts are Starting in the Applications Status Quo

Posted by Don Ryan. Don is a senior consultant for CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, Consumer Pulse

A bridge too far or an opportunity so near?

Posted by Don Ryan

Tue, Apr 06, 2010

HP's quest to be a service kingpin...

While attending the HP Industry Analyst Conference for the Enterprise Business Division in mid March in Boston - the point that struck me was the emphasis on the new businesses that HP sees as its next growth engines: service delivery and networking solutions. These two areas were stressed throughout all the sessions at the conference. Indeed, the focus on services is well placed as HP's service portfolio has more than doubled in the last 2 years to encompass over 30% of gross revenue mainly through the addition of EDS's business. HP's server and storage solutions while well represented took dual billing with the newer areas. The EDS teams presented in-depth case studies and shared their expertise in focused solution areas in telecom, financial services and manufacturing industries. These sessions really highlighted their ability to do large and complex IT infrastructure outsourcing projects.

However, while HP's service revenue is growing, not all service business should be equally valued by HP given its business model at the present time. HP's overall business model and go-to-market strategy is one that is based on scale and standardization.  This works well in the server, storage, PC and arguably the networking businesses. Where this doesn't play fully today is with HP's EDS services business which is typically highly customized and specialized to specific client environments and applications.

While some of EDS's  IT and outsourcing methodologies and practices can be leveraged across different customer environments, many of these cannot be easily reused today for other customers even within the same industry segment. Standardizing ITO and more commodity type BPO is a must have for HP at this point. Determining and taking advantage of delivery leverage points and processes is, in my belief, the number one challenge facing HP today as it migrates to a services based delivery company in the enterprise market.  If HP can successfully apply these core business principles of standardization and scale to its service business as it has done to its hardware and solutions business, then a truly successful and profitable service business model is on the near term horizon.  If on the other hand, the EDS business continues to exist as a set of one-off albeit large scale engagements, (lift and shift, your mess for less) then a successful services business model for HP built on standardization and scale will remain a bridge too far to cross.

Learn more about IT Service Delivery by downloading the full CMB Tech Pulse report: IT Services

Posted by Don Ryan. Don is the managing director of CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels. Don was assisted on this blog by Stan Lepeak, Managing Director of Equaterra (www.equaterra.com) a major outsourcing consultancy.

Topics: technology research, conference recap

As smartphones hit critical mass for consumers, what does it mean for businesses?

Posted by Don Ryan

Wed, Mar 24, 2010

Smartphones are becoming the new standard for cell phones. In a recent article from Marketing Daily:  NPD: Smartphone Sales Reaching Critical Mass,  Aaron Barr shares  research from NPD Group showing that smartphones accounted for 31% of all handset sales in the fourth quarter of 2009 (up from 23% for the same period in 2008). While part of this increase is surely due to the drop in price of smartphones and increased availability of these devices, the launch of Droid phones and the continued popularity of the iPhone has certainly contributed to this surge.

Ross Rubin, executive director of industry analysis at NPD tells Marketing Daily, "We've seen several popular models released under the $100 price point, including the iPhone 3G, and that's contributing to the popularity of smartphones. Smartphones are moving beyond the early technology adopters to a broader consumer market."

As smartphones become more and more ubiquitous they are blurring the line between work and personal devices, thus providing owners with mobile access to professional and personal email as well as a host of mobile business applications like Salesforce.com, webex, and more.

So what does this "consumerization of IT" mean to IT departments and how are they managing the infiltration to these consumer devices into the enterprise? This topic is the focus of our next CMB Tech Pulse coming in the next few weeks. 

Get all of the latest Tech Pulse findings and commentary by subscribing to our blog.

Posted by Don Ryan. Don is a senior consultant CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels.

Topics: technology research, mobile

Market Research Shows Netbooks Are Starting To Penetrate The Enterprise IT Market

Posted by Don Ryan

Tue, Mar 16, 2010

When I Google the term "netbooks" I get close to 16 million results. 16 million results for a new market entry!

The netbook market is growing rapidly for consumers, but we are also seeing growth in the enterprise. Similar to how smartphones slowly infiltrated the enterprise market, growth is slow but steady as the consumerization of IT continues.In our CMB Tech Pulse Netbooks in the Enterprise we asked over 150 IT decision makers about their interest in netbooks, deployment strategies, as well as current and future use.

The findings from our netbook research shows a lot of interest with close to 40% considering deployment of netbooks in their organization and 20% already using netbooks in some capacity.

  • 20% are already using netbooks in the company for a handful of selected people
  • 38% have not deployed them yet, but are considering it
  • 29% do not currently have any netbooks deployed and have no plans to do so
  • 13% do not have any deployed, but have it in their budget to do so

Not surprisingly, we also see a trend that has heavier deployments in those organizations with a highly mobile workforce and in those companies that are using cloud computing applications.

Learn more by downloading our report or seeing us at the Netbook Summit taking place May 24th- 25th in San Francisco. We will be presenting our research and sharing our insight with many other thought leaders.

Posted by Don Ryan. Don is the managing director of CMB's technology practice.

Topics: technology research, Consumer Pulse

Market Research Shows IT Service Providers Lack Brand Distinction

Posted by Don Ryan

Wed, Mar 10, 2010

In a recent Technology Pulse we asked 145 IT decision makers from US-based companies and organizations of all sizes about their use of and priorities for IT- related services for their organization.  One of the more interesting findings in this study is the lack of brand distinction for IT service providers. When we asked IT professionals about the uniqueness of several brands (based on a variety of brand attributes), the option "None" among these brands was actually ranked highest by IT professionals with 37% of respondents.

When the "brand" that had the highest distinctiveness was "None," that means that there are some brand attributes that IT decision-makers don't think any providers do well, and others where they think many providers do this well. Overall, we see that most IT services providers have not achieved distinct brand positioning among IT decision makers. Even large brands with very strong awareness, favorability, and purchase consideration momentum (such as IBM or HP) often do not stand out for any one particular attribute.

HP, for one, is taking steps to broaden their brand awareness.  In a recent Wall Street Journal article "H-P Revealing Its New Personality In Corporate Campaign" the author writes about the launch of Hewlett-Packard's first corporate ad campaign in more than five years. Clear positioning regarding services should be a focal point of these efforts.

It's vital for IT services companies to gain a better understanding of the opportunities to create distinction around their brand and understand what brand attributes are most important to their customers. Otherwise their biggest competitor "None" will beat them all.

Learn more by downloading the full CMB Tech Pulse report: IT Services

Posted by Don Ryan. Don is the managing director of CMB's technology practice. Don is an avid tennis player and enjoys reading political commentary and spy novels. 

Topics: technology research, Consumer Pulse, B2B research, brand health and positioning