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Product Launches | Trends

Gartner Predicts Key Tech Trends for 2006
By Sean Michael Kerner

November 29, 2005

The end of the year is typically the time for predictions about the future. What technology or trend will be the winner next year or the year after?

But research firm Gartner, has jumped into the prediction fray with an early entry, proclaiming that it has identified, “six IT industry trends that it expects will cause significant disruption and drive opportunity for business and the IT industry in 2006 and beyond.”

The six trends identified by Gartner include, notebook computers, telephony, the IT job market, Business Process Outsourcing, Healthcare software and regulatory compliance issues.

Computer notebook usage has been growing at a rapid clip for years. Notebooks are not always used strictly for work purposes by employees as mobility and work extend the technology beyond normal office boundaries. Gartner is now predicting that within the next two years (by 2008), 10 percent of companies will mandate that their employees purchase their own notebooks. Gartner figures that firms will have some form of a “notebook allowance” similar to a car allowance offered by some companies today.

The IT job market is also predicted to undergo a shift with the need for specialists declining in favor of what Gartner calls “versatilists” that handle multiple disciplines and assignments. By 2010, Gartner has predicted that the IT specialist job market will decline by 40 percent.

Business Process Outsourcing (BPO) service providers are also predicted to be big winners moving forward. According to Gartner’s forecast, BPO service providers will reap an $11 billion bounty from insurance companies by 2008 as insurers update their legacy systems. Gartner expects by 2008 BPO, will have the intellectual property and technology platforms to align with the distribution channel (for example, bank and investment houses) and launch insurance ventures that capture up to one percent of the global annual premium total of life, annuity, and property and casualty products.”

The aging baby boomer population is a key demographic trend that will also play out in the IT industry as investments in healthcare software increase 50 percent by 2009. That increased investment according to Gartner will yield a 50 percent reduction by 2013 in the level of preventable deaths.

The influence of regulatory compliance needs is expected to continue to increase and is predicted to cut into discretionary IT budgets all the way through 2008. Compliance spending according to Gartner is currently growing twice as fast as discretionary IT budgets and that trend is expected to continue.

Cell phones and VoIP are also expected to continue their march forward. VoIP or cellular will be the only telephony in use for 30 percent of US homes by 2010.

“It only took more than 125 years but POTS (plain old telephony service) is now on the decline in the U.S.,” said Ken Dulaney, vice president and distinguished analyst at Gartner in a statement. “The emergence of VoIP and the phenomenal rise of the mobile phone now represent the ‘dial tone’ for the future.”

Gartner expects that the six trends will provide opportunities for new and old market players and help to drive market growth.

“To catch the waves of change at their early stages, vendors, users and investors in technology will need to look outside their industries to find early adopters that provide inspiration for how these trends translate into business value,” said Daryl Plummer, group vice president and chief Gartner Fellow in a statement.

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