Unprecedented levels of government support will help CSPs deploy 5G more quickly and broadly than originally anticipated

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Communication service provider (CSP) spend on 5G infrastructure will scale faster and peak higher than originally anticipated due to the vast amount of support by governments in a range of countries, including but not limited to China, the U.S., the U.K., Japan, South Korea and Singapore. As a result, typical historical deployment curves for cellular technologies will not apply to the 5G market, which is now expected to be widely deployed globally by the middle of this decade instead of in the later years of the decade.

The pull forward and broadening of infrastructure investment are primarily due to attempts by leading countries to support their economies amid the COVID-19 crisis as well as to keep pace with China’s aggressive and broad investment initiative for competitive reasons. Over the past 12 months, 5G has become a highly political issue, and the unprecedented government involvement and funding are being justified on national security, economic competitiveness and public health grounds.

TBR’s 5G Telecom Market Landscape includes key findings, market size, customer adoption, operator positioning and strategies, geographic adoption, vendor positioning and strategies, and acquisition and alliance strategies and opportunities.

Vendors enhance core competencies with strategic purchases and AI investment to address IT challenges in the analytics services market

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All vendors tracked in TBR’s Digital Transformation: Analytics Professional Services Benchmark except Oracle expanded their analytics services revenue in 1Q20, albeit at a slower pace from the previous year, highlighting that optimizing IT operations — through the use of analytics — is becoming table stakes for buyers.

Accenture took over the No. 1 spot from IBM Services in revenue size in 1Q20, something TBR saw coming a couple of years ago. In TBR’s 1Q18 A&I Professional Services Benchmark, we wrote, “In 1Q14, when TBR launched the inaugural edition of this benchmark, Accenture’s quarterly A&I services revenue was just over half the volume of IBM’s. In 1Q18 Accenture was nearly 85% of IBM’s size in overall A&I services revenue, surpassing Big Blue in three service lines and one region. Though IBM made significant strides to reshape its services organization over the last four years, those efforts came too late to protect its market share.”

TBR’s Digital Transformation: Analytics Professional Services Benchmark addresses changes in leading digital transformation vendors’ strategies and performances as well as their investments and go-to-market positions as it relates to the ever-evolving analytics services market. The report includes use cases and analysis of IT services’ and consultancies’ management of technology partnerships as well as highlights region-specific market trends to benchmark key service line, regional and operational data across 20 leading analytics services vendors.

COVID-19 causes analytics services market to pause, allowing vendors to prove the true value of analytics and better train their AI models

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All vendors tracked in TBR’s Digital Transformation: Analytics Professional Services Benchmark except Oracle expanded their analytics services revenue in 1Q20, albeit at a slower pace from the previous year, highlighting that optimizing IT operations — through the use of analytics — is becoming table stakes for buyers.

Accenture took over the No. 1 spot from IBM Services in revenue size in 1Q20, something TBR saw coming a couple of years ago. In TBR’s 1Q18 A&I Professional Services Benchmark, we wrote, “In 1Q14, when TBR launched the inaugural edition of this benchmark, Accenture’s quarterly A&I services revenue was just over half the volume of IBM’s. In 1Q18 Accenture was nearly 85% of IBM’s size in overall A&I services revenue, surpassing Big Blue in three service lines and one region. Though IBM made significant strides to reshape its services organization over the last four years, those efforts came too late to protect its market share.”

TBR’s Digital Transformation: Analytics Professional Services Benchmark addresses changes in leading digital transformation vendors’ strategies and performances as well as their investments and go-to-market positions as it relates to the ever-evolving analytics services market. The report includes use cases and analysis of IT services’ and consultancies’ management of technology partnerships as well as highlights region-specific market trends to benchmark key service line, regional and operational data across 20 leading analytics services vendors.

As COVID-19 inspires greater cloud usage, customers seek security and customization benefits in hosted private cloud options

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Market overview

Infrastructure services hosted as single-tenancy offerings remain desirable to customers that are looking to bridge the gap between utilizing public clouds and building their own private clouds on premises. The global COVID-19 outbreak weighed heavily on many IT vendors’ business models during the quarter; however, the hosted private cloud space was less susceptible to the economic impacts of the pandemic given the annuity-based revenue streams gained through cloud sales. Long term, TBR expects the hosted private cloud market to record pockets of growth as we expect COVID-19 to prompt greater cloud usage, and many customers will turn to private cloud solutions as a preliminary step in the digital transformation process. Further, benchmarked vendors will benefit from enterprises’ increasingly hybrid scenarios, which are generally purchased on a workload-by-workload basis.

The Hosted Private Cloud Benchmark analyzes different enterprise use cases and vendor strategies. For example, the benchmark looks at how workloads such as ERP will drive demand for hosted private cloud SaaS due to the mission-critical nature of those services and their associated data.

COVID-19’s societal pressures kick up a Digital Dust Bowl

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Evolving business activity and social interaction have been on a collision course with dated public policy best practices for decades

Three years ago, TBR put out a report called The impending Digital Dust Bowl: Mitigation, survival and interdependence, in which we evaluated the social, economic and political arenas and examined how the pivot to digital business and social interactions was disrupting society. In the interim, we have discussed what seems to be transpiring as a societal rebirth, arguing that while there would be pain involved as a normal component of bringing about new life, the end result would be a better world because of what the technology industry can enable the world to do. Big changes are on the cusp of commercialization as blockchain ensures data accuracy, machine learning addresses new queries, and quantum provides the compute horsepower needed to tackle the world’s most intractable problems.

Three years ago, in discussing AI’s impact, the historical comparison we settled on was the Great Depression, fueled by manufacturing automation, which appeared to be a reasonable analogy. Henry Ford launched his first assembly line in 1913; Watson beat a human on “Jeopardy!” in 2011. These were the comparative touchstones.

At this juncture, we may view that historical comparison as a best-case example and may find mechanization in the early to mid-1800s as a more appropriate parallel. The mid-1800s radically transformed agrarian economies, and that disruptive impact spurred the revolutions of 1848 in Europe and was a contributing economic factor to the U.S. Civil War.

Few conversations today are held without discussing the implications of COVID-19 on our daily lives. Technologists and other pundits talk of the accelerating trends the pandemic triggers. Whether social, business or political trends as we know them, COVID-19 has certainly quickened the rate at which those trends are being felt by virtually everyone around the globe. It is a unique time and highlights the need for career technologists to step forward and participate heavily in the dialogues occurring throughout society on how to remediate the dysfunctional aspects of modern life on which COVID-19 has shined a very bright light.

Public sector entities besides the U.S. federal government bear a disproportionate share of pandemic-related impacts

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The predominance of the U.S. federal market is on display in Figure 1 as most of the observed deceleration owes to the diminishing impact of strategic acquisitions made by federal IT vendors prior to 2019 and the sharp slowdown in overall M&A through 1Q20. The latter trend will be exacerbated by the coronavirus outbreak as acquisition activity grinds to a near complete halt in conjunction with the turbulence in global capital markets. IT spending by the civilian agencies of international governments was also affected by the pandemic, with some ongoing IT programs furloughed temporarily or indefinitely, while others saw their funding redirected to emergency public health initiatives in response to the outbreak. Buffering these headwinds was the continuance of defense modernization programs, particularly in Europe, Australia and the Middle East, though the negative effects of declining oil prices may impact the latter market.

TBR’s Public Sector IT Services Benchmark compares and contrasts the included vendors’ go-to-market models, recent investments and key deal wins. Additionally, the benchmark reviews a number of key financial performance metrics and highlights vendors that have been particularly successful in expanding market share and improving profitability.

On Earth, the Economy Is Tanking. In the Cloud, It’s Fine

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Catie Merrill, who tracks the cloud industry at analyst firm TBR, says all the leading cloud providers will likely splurge on hardware this year. “My sense is that they are going to increase that spend a lot to accommodate new demand,” she says. The trend will likely continue even as countries reopen, she says, because companies that already planned to shift more systems into the cloud are accelerating those plans. — Wired

Quick Quantum Quips: Vendors roll out software applications to increase customer connections through partnerships and internal innovation

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Welcome to TBR’s monthly newsletter on the quantum computing market: Quick Quantum Quips (Q3). This market changes rapidly, and the hype can often distract from the realities of the actual technological developments. This newsletter will keep the community up to date on recent announcements while stripping away the hype around developments.

For more details, reach out to Stephanie Long or Geoff Woollacott to set up a time to chat.

July 2020 Developments

Tying systems and software together has been a general focus of July quantum computing activity. These ties increase quantum computing vendors’ ability to more adequately address and meet the emerging needs of their customers. The finance and banking industry remains a key customer base for quantum as more financial customers partner to develop industry-specific applications for the technology.

  1. Cambridge Quantum Computing (CQC) and IBM partnered to make CQC the first startup-based hub in IBM’s Q Network. This move grants CQC cloud-based access to IBM’s army of 20 commercially available quantum computers. Leveraging this cloud-based access and Qiskit, CQC along with members of its hub will work on advancing quantum capabilities for specialized use in areas such as chemistry, finance and machine learning.
  2. D-Wave has expanded its Leap quantum cloud service into India and Australia, increasing the global footprint of its quantum technology. D-Wave’s quantum cloud service is now available in 37 countries. In addition to the Leap Quantum Cloud Service, customers in India and Australia will now also have access to D-Wave’s Hybrid Solver Service, Integrated Developer Environment and Problem Inspector solutions as well as access to flexible increments of computing time in a hybrid computing model. D-Wave offers this flexible access in free and paid plans.
  3. Atos unveiled its Quantum Annealing Simulator, which is compatible with Atos’ Quantum Learning Machine and enables the company to provide customers with access to quantum capabilities via a simulator as well as gate quantum computing through its existing portfolio. TBR believes this approach is strategically advantageous for Atos, as quantum annealing gives customers access to a quantum-like solution that achieves a lower error rate faster than a traditional system, enabling Atos customers to become familiar with the technology while the system developments continue to reduce error rates and expand capabilities.
  4. Atos also unveiled an open innovation accelerator program — called Scaler, the Atos Accelerator — which is geared toward vertical-centric experts and startups. As part of this program, 15 startups and vertical-specific experts will be selected annually to participate in developing quantum-specific projects fueled by customer interest. The research will further support the development and enrichment of Atos’ existing quantum computing offerings and also reinforce, in TBR’s view, Atos’ ability to provide quantum services. TBR notes that this approach to innovation is similar to that of other services firms involved in quantum computing, where innovation is largely customer driven to address specific demands.
  5. Standard Chartered Ventures unveiled its commitment to researching potential uses for quantum computing in the finance and banking industry through its academic partnership with Universities Space Research Association (USRA). USRA is a U.S.-based nonprofit with 49 university members. Standard Chartered Ventures noted that some use cases being explored through quantum computing include simulating portfolios and significantly increasing the speed of market data generation.

If you would like more detailed information around the quantum computing market, please inquire about TBR’s Quantum Computing Market Landscape, a semiannual deep dive into the quantum computing market. Our most recent version was released in June.

Amid a consolidating market, vendors adopt creative initiatives to fight for mission-critical cloud workloads

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Public cloud growth leaders

While Amazon Web Services (AWS) continues to dominate the public cloud IaaS market, its rivals continue to expand in the space and even collaborate to take market share. Microsoft and Oracle added a new data center interconnection in Amsterdam, deepening the ties between the vendors as they enable customers to run Oracle workloads on Azure and integrate workloads between the vendors’ clouds. TBR believes Microsoft and Oracle will continue to improve their competitive position against AWS as more data center interconnections are added. In addition, TBR expects Alibaba will become a growing threat to AWS and other U.S.-based vendors as it builds out data centers in APAC and EMEA.

Public cloud remains the largest and fastest growing segment of the cloud market. Changes in customer acceptance, data integrations and innovation have combined to sustain the rapid growth of public cloud adoption. The Public Cloud Benchmark details how hybrid deployments, new use cases for enterprise apps, and trends in emerging technology will make public cloud even more relevant in the future.

IT majors may have incurred higher costs for insurance, health benefits for staff in June quarter

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“Rewarding employees, especially the over-performing ones, with higher variable pay during times of crisis is typically a strong morale booster. While attrition also came down across all vendors, vendors know that retaining highly-skilled, loyal personnel can be a hard task, said Boz Hristov, Professional Services Senior Analyst, Technology Business Research Inc.” — The Hindu Business Line