5G will support growth in the deployment and professional services markets, while slowing the decline of maintenance spend due to decommissioning and NFV/SDN

HAMPTON, N.H. (May 31, 2018) — According to Technology Business Research, Inc.’s (TBR) Telecom Infrastructure Services North America Market Forecast 2017-2022, the North America telecom infrastructure services (TIS) market will grow through the forecast period for three key reasons: Tax reform will stimulate capex investment; digital transformation initiatives will drive spend; and 5G investment will be pulled forward and accelerated by the big four operators in the U.S. to obtain or retain a competitive advantage. Spend pertaining to these overarching trends will be partly offset by cost savings from legacy infrastructure decommissioning, cloud, and NFV/SDN as well as synergies that are realized from M&A. TBR estimates the market will grow at a CAGR of 0.6% from 2017 to 2022.

“The big four operators in the U.S. intend to commercially deploy 5G as soon as late 2018, with deployments set to ramp up in 2019 and through the remainder of the forecast period,” said TBR Telecom Senior Analyst Michael Soper. “5G requires significant investments in fiber and upgrades in the network backbone and access layer, all of which will drive spend on TIS. 5G will slow the pace of decline in the maintenance market in the later years of the forecast period, but will not return the maintenance market to growth due to the aforementioned decommissioning and NFV/SDN.”

Vendors largely showed growth in North America in 2017. Although vendors with hardware exposure had flat or declining TIS revenue, suppliers grew sales if they had services and software portfolios aligned to operator transformation needs. Ericsson’s revenue declined predominantly due to the rescoped Sprint managed services contract. Cloud service provider spend remains robust in the U.S., helping Accenture and Nokia post growth in the region despite ongoing weak spend by telecom operators. Other vendors, particularly Juniper, are also obtaining a greater portion of TIS revenue from cloud service providers. Looking toward 2018 and beyond, IT services firms and software-centric companies, particularly Accenture, Amdocs, Tech Mahindra and Tata Consultancy Services (TCS), are best positioned to help operators capitalize on the digital economy.

TBR’s Telecom Infrastructure Services North America Market Forecast provides annual analysis and forecasting of the deployment, maintenance, professional services and managed services markets for network and IT suppliers.


Analysis: HP thrives on consolidation, enjoys a strong quarter in all its businesses

Despite its central position in two flat markets, personal computers and printing, HP has reported double-digit annual revenue growth in both, and double-digit operating profit growth in PCs for its most recent quarter. Growth in printing was, in part, inorganic, following on the company’s acquisition of Samsung’s print business, named S-print. At the same time, the printing business operating profit growth was only 1.6% year-to-year, and operating margin decreased 140 basis points to 16.0%, a consequence of the costs of incorporating S-print. — Daniel Callahan, Analyst

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Analysis: Lenovo can see light at end of tunnel as PC, data center businesses grow

Lenovo last week reported double-digit revenue and operating profit growth as its core PC and Smart Devices (PCSD) business thrived with 15.9% annual revenue growth and its Data Center Group enjoyed 43.8% year-to-year growth. The Moto mobile devices business shrunk, however, recording a 24.3% reduction in revenue. Profitability improved across all three groups, with increased PC pre-tax income, and reduced pre-tax losses in both data center and smartphone businesses. — Daniel Callahan, Analyst

The value imperative: Healthcare IT services vendors reorient around value-centric models of care delivery and payment

Traditional paradigms for healthcare payment and delivery are transforming into models that offer enhanced value, accountability, transparency and patient outcomes. To pivot with the market and its embrace of value over volume, healthcare organizations are reorienting themselves and their health IT infrastructures to become more data-driven, patient-centric and value-focused. Join us Sept. 26 as we discuss how healthcare IT services (HITS) vendors are evolving their solutions and go-to-market approaches to effectively navigate the changing healthcare market.

Join John Caucis as he reviews TBR’s most recent Healthcare IT Services Benchmark and discusses the trends shaping the HITS market in 2018.


Could cloud cast a shadow over Dell’s bottom line?

Cloud casts a shadow over Dell Technologies’ upbeat view of the future … . Specifically, the mega-scale global public cloud threatens the company’s margins. Dell Technologies is a vendor to public cloud providers, but because of the small number of major public cloud vendors and those companies’ technological self-sufficiency, the greater the percentage of computing and storage housed in public clouds, the lower the potential for Dell Technologies’ bottom line. — Stanley Stevens, Practice Manager and Principal Analyst; and Ezra Gottheil, Principal Analyst


Technology Business Research, Inc. announces 3Q18 webinar schedule

HAMPTON, N.H. (May 22, 2018) — Technology Business Research, Inc. (TBR) announces the schedule for its 3Q18 webinar series.

July 11          Wallet vs. will: Transformation of government technology adoption

Aug. 8           Revenue growth drivers and opportunities in the IT services market

Aug. 15        IoT vendor roles

Sept. 12       Going inside customers’ minds to predict the future of cloud

Sept. 19       Webscale ICT market update

Sept. 26       The value imperative: Healthcare IT services vendors reorient around value-centric models of care delivery and payment

TBR webinars are held typically each Wednesday at 1 p.m. ET and include a 15-minute Q&A session following the main presentation. Previous webinars can be viewed anytime on TBR’s website.

Webscale ICT market update

Webscales are focused on building out their global cloud empires while investing in emerging areas, such as artificial intelligence, machine learning and other cutting-edge technologies, to obtain a competitive advantage in the market and unlock new revenue streams. Webscales also remain focused on leveraging new technologies to bridge the digital divide, which includes bringing network connectivity to the unserved and better connectivity to the underserved peoples of the world. Join senior analysts Chris Antlitz and Michael Soper for an in-depth and exclusive review of TBR’s most recent Webscale ICT Market Landscape.

Cisco tech expansion drives growth but earnings disappoint; shares drop 4%

Cisco’s continuous portfolio expansion around growth initiatives centered on security, network, multi-cloud, advanced analytics, and customer and employee experience drive opportunities across Cisco Services’ portfolio of Advanced Services and Technical Support Services. — Kelly Lesiczka, Research Analyst

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Artificial intelligence needs human design

Artificial intelligence (AI) technologies continue to progress, with vendors increasingly embedding machine learning capabilities into enterprise applications and consumers coming to expect a level of personalized, yet automated, interaction that only AI can deliver at scale. Discussions around the potential hazards of AI to brand reputations, personal data protection, constitutional freedoms and society at large have become commonplace, but this has not slowed the pace of technological advancement. While AI technology vendors continue to lead and engage in these discussions (especially when their own reputations and research investments are at risk), ultimately, organizations that incorporate AI tools into business decisions and automated processes will be responsible for the impacts of those technologies.

If the 2018 O’Reilly Artificial Intelligence Conference made anything clear, it was that as AI adoption grows, so does the technology’s complexity, particularly at the intersection points between humans and machines and between regulatory policy and technological innovation. This should sustain professional services opportunities for vendors that can stay on top of AI technology developments while maintaining a broader perspective on the impact of AI on clients’ business processes and HR strategies. Still, many questions remain unanswered, including how to manage security and governance over the massive autonomous systems that will be coming online in the next several years; whether the approach taken by the European Union with its General Data Protection Regulation (GDPR) will become the global standard; and what the long-term impact on human intelligence and skills will be as machines take over more tasks. It is unlikely these issues will be resolved by the 2019, or even 2020, O’Reilly Artificial Intelligence Conference, but vendors can start to address some of these questions with clients through consulting and solution design engagements tied to broader digital transformation initiatives.

Event overview

TBR attended business and technology learning content company O’Reilly Media’s third O’Reilly Artificial Intelligence Conference, an event centered on a variety of AI topics, including enterprise use cases, implementation, business and societal impacts, product design, and machine learning methodologies, over two days in New York. The conference’s theme, “Putting AI to Work,” mirrored that of last year, but sessions and discussions reflected growing maturity in how enterprises and researchers approach, develop and apply AI technologies. Keynote speakers represented AI technology vendors such as Intel AI (the conference’s co-presenter, as announced last year), Google, IBM Watson, Microsoft (Nasdaq: MSFT), Amazon Web Services, SAS, Digitate and Uber, as well as research institutions such as MIT, Princeton and Carnegie Mellon. In addition to tactical sessions around specific AI use cases designed for data scientists and software engineers that were abundant last year, new in 2018 was the AI Business Summit track tailored for executives, business leaders and strategists (and for TBR’s lead analyst covering professional services related to AI, analytics and digital transformation). TBR also interacted one-on-one with founders, product leads and marketing executives from AI-related startups such as Alegion, Kinetica, Clusterone and Dataiku throughout the conference.

Going inside customers’ minds to predict the future of cloud

Looking at customer spending may tell where cloud has been, but going inside the minds of cloud customers can predict future changes. This insight comes at an important point, as the maturation of enterprise cloud adoption and vendor offerings have created a new reality for the cloud market. Purchase decisions are becoming more focused on the workload and use case rather than on the deployment model, and top vendors have solidified their positions on workload leaderboards.

Given these shifts, customer buying behavior and decision making have become more nuanced. TBR’s Cloud team has shifted its end-user research to better capture the new intricacies of the cloud market. Join Allan Krans, Cassandra Mooshian and Meaghan McGrath as they discuss the most recent insights from TBR’s cloud applications customer research and cloud platform & infrastructure customer research.