2.3% IT Spending Growth in 2009, Says Gartner

Granted, everybody is looking in the rear-view mirror, but Gartner analysts now expect an information technology spending increase of 2.3 percent in 2009, revised down from the original expectation of 5.8 percent, according to  Peter Sondergaard, Gartner SVP. 

“Developed economies, especially the United States and Western Europe, will be the worst affected, but emerging regions will not be immune. Europe will experience negative growth in 2009, the United States and Japan will be flat.”

Give it a quarter, though. October's impact might not yet be so clear. 

How Long Will Your Cash Last? Start-Ups Too Casual

Entrepreneurs are not worried enough about herding their start-ups through a rough patch, Rafe Needleman, CNET News writer says. A recent survey of 491 respondents found that 30 percent reported having two or more years of money in the bank, or are cash-flow positive.

About 21 percent say they have a year's worth of cash set aside.

About 49 percent reported having only three or six months of cash. That suggests as many as 50 percent of firms will be in serious trouble if an economic slowdown lasts more than a year.

Also, only 33 percent of the 524 respondents say they are "worrying about revenue and payroll."

Granted, the slowdown does not to some of us appear to be a "nuclear winter," though one could get a huge argument going on that score. Still, when young companies cannot raise the next round of funding, they die. Hence the importance of cash on hand.

Wireless Reconnectors: Wireless-Only Has Downside

A recent survey conducted by Nielsen Mobile suggests wireless-only households now have reached about 17 percent penetration nationwide, and could well hit 20 percent penetration by the end of the year.

But Nielsen also found something else: 10 percent of U.S. households with landline phone service in the second quarter 2008 were previously wireless-only users, and had chosen to buy wired voice service again.

That is important for obvious reasons. Just as some users find wireless-only service to be attractive, 10 percent of users also have found wireless-only service to be unsatisfactory.

The issue is “why?” When we look at the landline tenure of these former wireless-only users, approximately one percent of wireless-only users may return in any given quarter, Nielsen Mobile says.

As it turns out, mobile coverage is sometimes perceived to be insufficient for would-be or former wireless-only users. Dropped calls and poor audio quality are reasons wireless-only users decide a landline service still makes sense.

Web 2.0 Bubble Burst: Been There, Done That

For some of us who were part of companies that cratered during the Internet bubble burst starting in 2001, past truly is prologue. Some companies will discover "zero" is their present valuation. Others will be gobbled up by the elephants in the room. Larger, better-capitalized firms are going to find attractive assets to buy, and buy them.

Media companies will move relatively early, even telcos might find it is the right time to "move up the stack" from layers one and two to the application layer, in broader ways.

Remember the last sea change? All of a sudden, "eyeballs" (reach) largely ceased to matter. Revenue did matter. But firms that already have scale and revenue might be able to reposition acquired assets that primarily represent "reach," and convert reach into revenue.

In the start-up business, 80 percent failure rates are the norm. All that will happen now is that failure rates will accelerate, as firms find they cannot get the next financing round. But the elephants will be dancing.

Typical Media-Buying Behavior Seen

Given that consumer spending has been generally sluggish all year, even before the recent liquidity crisis, it shouldn't be surprising that some discretionary purchases are showing sluggishness as well. 

Mid-summer research by Changewave Alliance, for example, has been showing slowing consumption of downloaded media. Compared to a year ago, ChangeWave's latest survey of 2,248 consumers shows entertainment downloading has actually slowed. 

Where in July 2007 about 48 percent of respondents reported downloading songs, in July 2008 just 43 percent said they currently were downloading songs. Likewise, where 14 percent of respondents in July 2007 reported downloading movies, just 11 percent said they had done so in July 2008. The same declines were seen in TV show downloading, computer games downloads, music or book downloads as well. 

Moreover, the percentage of our respondents saying they do not download entertainment has risen to 41 percent, about six points higher than in 2007. 

This sort of behavior might be likened to what one typically sees in times of economic stringency: people downgrade some forms of discretionary entertainment spending. People do not tend to disconnec their cable or wireless services. But they might downgrade a service package to eliminate premium channels like HBO or Showtime. 

Downloads of songs, movies or TV shows fall into that category. One can simply download fewer titles to save a little money, while keeping the basic subscription services (broadband stays, but fewer items are purchased). 

Xohm Latency Performance Stands Out

In recent tests conducted by Computerworld, Sprint's 4G Xohm network showed latency performance far superior to the AT&T "Broadband Connect" 3G network, with higher throughput as well. Where downloads ran at about 1.3 Mbps to 1.7 Mbps for Broadband Connect and 3.4 Mbps to 4.4 Mbps for Xohm, the more-important statistic might have been the latency figures.

Where the AT&T 3G network had a "ping" response of about 234 milliseconds, the 4G Xohm network had 97 millisecond pings. In layman's terms, Xohm-delivered applications responded faster to user requests. 

Low-latency performance--sometimes described as latency performance identical to a traditional wired network--has been a key design goal for the Xohm network, and has been deemed important for support of real-time applications. 

People Use Cloud Computing; They Just Don't Know

Whether one looks at how average consumers “compute,” or how industry segments “compete,” it now appears that cloud computing is poised to change the ways users interact with each other, use applications, communicate and compute. Some of the changes are obvious; others only now developing. 

Conceptually, there are several ways cloud computing already is used. Applications in the cloud is what almost everyone already has used in the form of Gmail, Yahoo mail, wordpress.com, Google apps, search engines, Wikipedia or virtually any Web-executable application.

Platforms in the cloud are used virtually exclusively by software developers and their clients. Developers write their applications to a open specification and then upload their code into the cloud where the app is run remotely.

Infrastructure in the cloud takes the software development process a step further. Developers use remote, network-based compute, storage, queueing, and other resources to create and run their applications.

“Cloud computing” sometimes is likened to grid or distributed computing, utility computing (computing as a service), software as a service, network computing, Internet-based applications, autonomic computing, peer-to-peer computing or remote processing. It typically is some combination of those things.

And as much attention as cloud computing gets in the enterprise information technology space, it already is making serious inroads in the consumer space.

Some 69 percent of online Americans use Web mail services, store data online, or use software programs such as word processing applications whose functionality is located on the Web, say researchers at the Pew Internet & American Life Project. They are, in other words, already users of “cloud computing,” an emerging topic in the enterprise computing space as well.

Some 56 percent of respondents say they have used a Web mail service such as Hotmail, Gmail, or Yahoo. About 34 percent say they have stored photos online. Some 29 percent say they have used online applications such as Google Docs or Adobe Photoshop Express, as well.

About seven percent say they store personal videos online, while five percent say they have a for-fee online storage service and another five percent say they use an online backup service.

About 51 percent of Internet users who have done a cloud computing activity say a major reason they do this is that it is easy and convenient. Some 41 percent of cloud users say a major reason they use these applications is that they like being able to access their data from whatever computer they are using, Pew researchers say.

Some 39 percent cite the ease of sharing information as a major reason they use applications hosted in the cloud, or store their data remotely.

As you might expect, users with mobile computer access are more likely to have done these activities. Among the 34 percent of online users who have used a WiFi connection on their laptop to go online, 79 percent have used at least one cloud computing activity above, and 52 percent have used at least two.