Predicting 2010   |  February 12, 2010  

By Danny Bradbury

2009 was a heck of a year for the computing industry, as for many other sectors. We faced unprecedented belt-tightening in the enterprise sector, just as we saw technological trends as diverse as cloud computing, microblogging and electronic books come to fruition. Google found itself at loggerheads with the entire newspaper industry; Twitter had a reported 32.1 million users by May 2009; Windows 7 launched, replacing the debacle that was Vista, and 51 per cent of respondents in an IDC survey reported they would install the new OS by the end of 2010.

What else is likely to happen in 2010? Backbone consulted a lineup of analysts and vendor companies to get a sense of what they thought would be significant trends in the coming year. The results are stimulating, to say the least. 

Emerging trends and technologies

E-book readers will hit the mainstream
E-book readers were already taking off as 2009 dawned, and recently both Amazon’s Kindle and a touchscreen version of the Sony eReader arrived in Canada. Rumours suggest Apple will launch a touchscreen tablet this year, and that it has been courting publishers to put their content in its store. This makes sense: the company disrupted the music industry and doing the same with written content seems like a no-brainer. On the other side of the financial fence are bricks-and-mortar bookstores. In December, Winnipeg-based McNally-Robinson Booksellers declared bankruptcy, Borders UK has closed all its stores in Britain and Borders Group is closing 200 Waldenbooks outlets in the U.S. Canadian chain Indigo still seems strong, but it, too, has made moves into e-books: it recently spun off its Shortcovers e-book service, now renamed Kobo, and announced it is working on an e-book device. Forrester Research predicts U.S. e-book sales will top US$500 million in 2010.

Customers will develop policies covering social media use
Facebook, Twitter, LinkedIn and other Web 2.0 technologies are becoming an increasingly important part of the workspace as millennials—those born between 1982 and 2004—enter the workforce in greater numbers and demand that employers play by their rules and use their technology. Companies that have not adapted to these systems will be forced to do so, and to develop rules about their use and misuse. The really smart ones will think beyond rules and come up with ways to engage social networks for marketing purposes in a subtle but effective way. Firms such as Radian6, which enables companies to monitor and measure their effectiveness in social media, will help in this regard.


Advertising will become more targeted and behavioural
Internet-based advertising took a hit, along with the rest of the advertising industry, during the financial crisis. Signs are pointing to its comeback but new technologies will force it to work smarter, not harder. Companies such as Overlay.TV, which supports the embedding of advertising in online video, are inventing new ways to advertise to users. Expect advertising to move beyond the boring old banner ad in 2010, as companies realize new ways to make their messages stick—including mobile advertising.

Cloud computing

Companies will begin to manage cloud computing environments more intelligently
Companies are adopting cloud computing internally. Creating a private cloud behind the firewall, for example, may use virtualization to abstract logical resources (such as operating systems and applications) from hardware. And companies have been grappling with the idea of squeezing lots of virtual machines onto a single box to increase processor utilization and computing efficiency. But the next stage involves automating the management of those virtual machines. Automatically moving machines between computers to make the best use of computing resources is one task that can further improve efficiency. Another is automatically patching virtual machines with anti-malware protection and system updates, without having to start them up. And monitoring the number of virtual operating systems in an environment so that unused ones can be deleted is a task that many companies are only beginning to understand.

The cloud will become a security battleground
The security community consists of two factions: the blackhats (online criminals who exploit victims) and the whitehats (the industry heroes who try to stop them). We are already seeing whitehat organizations put security services in the cloud. Managed security providers can do everything from malware scanning through to firewall protection in the cloud. We’ll see growth in managed security services in 2010. However, the blackhats aren’t standing still. In late 2009, we began to see them use cloud-based services such as Amazon’s EC2, Google’s App Engine and even Facebook to issue commands to infected computers that form part of a botnet. This situation is likely to get worse as more criminals clue in to the potential of cloud-based computing. In short, the cloud will raise the stakes on both sides.

Endpoints will be dragged into the cloud
Companies have long since understood the total cost of ownership issues associated with PCs, which break down, offer far more computing power than is typically used, consume a fair bit of energy and must be refreshed every few years. An alternative is virtual desktop integration, in which the PCs are hosted on a central server and accessed via a thin client (essentially a keyboard and a screen). This style of working has been available for several years but as cloud computing matures it becomes more feasible to move the entire operating system over to a hosted environment. Oh, and we’re still waiting for Google’s rumoured GDrive service, which will virtualize a whole computer operating system online for consumers. Now that it has launched an open-source version of its Chrome operating system for developers, an online version may not be far away.

Convergence

Flex-fabric architectures will come to the forefront
Companies today run lots of different network protocols over lots of different cable. Ethernet, for example, carries the IP traffic used for e-mail, Web surfing and some telephone calls. Storage area networks (the high-performance virtualized storage infrastructures used in many data centres) often use fibre channel, which needs its own physical infrastructure. Companies running these kinds of high-end systems have found it difficult to merge them, requiring, instead, a rat’s nest of different cables running throughout their data centres along with different input/output devices, which has increased capital and operational expenses. Thanks to the introduction of 10Gbit Ethernet and new protocols such as fibre channel over Ethernet (FCoE), it is becoming possible to run all protocols over existing Ethernet cables, thereby reducing network complexity. Expect to see companies beginning to adopt these converged network technologies in 2010.

Converged communications will catch on between companies
To date, companies dabbling with IP telephony and video have been heavily focused on doing it behind their own firewalls, facilitating calls between regional offices, for example. Analysts think the idea may start to catch on between companies, specifically via the session initiation protocol (SIP), the technology used to set up IP telephony calls. SIP trunking enables one IP-powered switchboard to route calls to another. It is hoped that once these inter-company SIP services begin to appear, unified communications systems may be layered on top of them, so, for example, employees in one company may use instant messaging presence technologies to tell when employees in another office are at their desks.

The network innovation well will run dry
The networking industry is facing unprecedented challenges in areas such as security, bandwidth, latency and management. Video and file sharing data accounts for a huge amount of public network traffic, for example. But the financial crisis has taken its toll on seed funding for young, innovative companies in the networking sector, and that could spell trouble in the future. As the funding dries up, the ideas needed to keep networking technology moving forward are unlikely to make it through the pipe. Expect a dearth of innovation in networking as a result, while the industry recovers and venture capital companies find their feet again.

Security

URL shortening abuse will go into overdrive
Thanks to the rise of Twitter, the 140-character microblogging service that went mainstream last year, the popularity of URL shortening services such as tinyurl and bit.ly (Twitter’s official shortening service) have increased. Online criminals have begun using these services to mask the real identity of malicious URLs that infect victims’ machines with malware, or take them to spamming Web sites. bit.ly, among others, has introduced technology that scans shortened URLs to see if they match a database of malicious sites, but this is a constant uphill battle, as spammers and malware peddlers try to beat security services to the punch. As the number of Twitter users grows, and as services such as Google’s URL shortener Goo.gl join the fray, expect to see more URL shortening abuse in 2010.

Smartphone attacks will increase
As the number of smartphones used by North Americans increases, the platform becomes more attractive to attackers. The back end of 2009 saw the first serious strain of malware for the iPhone, which stole phone records and co-opted them to a botnet. Luckily, this attack was restricted to phones that had been “jailbroken.” Google’s recently released Android mobile phone operating system was found to have a flaw that enables an attacker to gain root access to the system, essentially owning the device. With smartphones almost guaranteed to contain significant personal information, e-mail and contact data, the number of attacks will only grow throughout 2010.

Malware will require more than signature-based scanning
Traditionally, anti-virus companies have been able to look for malicious software by analyzing its specific binary footprint, known as a signature. However, malware is becoming increasingly sophisticated, to the point where infected servers create a unique version of the malware for each victim, making it very difficult to spot. This has led security companies to explore new ways to identify malware. Reputation-based systems try to evaluate a piece of software’s standing within the community, while behavioural analysis watches out for the common activities of malware, such as logging keystrokes. These will become increasingly important technologies in the coming year. Some companies will also turn to whitelisting, the idea of only allowing pre-defined software programs to operate on computer systems, rather than trying to successfully identify millions of different malware variants on a blacklist.

Mobility

Smartphone use will increase dramatically, leading to more mobile access to corporate applications Smartphone sales are likely to surpass non-smartphone sales by 2015, according to a report from Telecom Trends International. In Canada, the big three cellular carriers have all adopted the iPhone, and the BlackBerry is already well established. With the increasingly Web-based nature of company applications and the global rise in mobile workers, these smartphones are likely to be rolled into corporate solutions that extend beyond mere e-mail and calendar management.

Increased cellular competition will democratize the Canadian cellular market
The Canadian cellular market has been dominated by the big three: Telus, Rogers and Bell. However, the auctioning of cellular bandwidth by Industry Canada in 2008 opened the market to new players like GlobaLive, which launched its WIND Mobile service as this article went to press. The company has adopted a no-contract approach, in which mobile device subsidies are removed (leading to more expensive phones) in return for no system access fees and the ability for the consumer to terminate their contract at any time. More carriers, such as Dave Wireless, Public Mobile and Vidéotron ltée, will enter the wireless industry in Canada in 2010.

Wireless substitution will extend beyond voice to high-speed Internet services
We are already seeing the younger community eschew land-line phone services in favour of wireless cellphone systems. Analysts are now predicting that we may see the same thing happen to broadband data services. Thanks to products such as the Rogers Rocketstick and iPhone tethering, it is now possible to access the Internet at high speeds without plugging into an Ethernet cable or Wi-Fi signal. Although niche groups such as data-intensive online gamers and video downloaders may choose to remain with wired broadband service, many may find it easier to pull the plug altogether and rely on a generous, if limited, data plan from their mobile provider. As we move into high-speed cellular services like Rogers’ 21Mbit/sec HSPA+, with a 5GB data plan costing around $85, this becomes feasible. And WIND’s new unlimited data plan for smartphones and laptops lends more credence to this prediction. 

The experts

This piece was based on the opinions of multiple industry experts

Jayanth Angl, senior research analyst, Info-Tech Research Group

Angl specializes in market research on enterprise networking and communications. He was formerly a technical analyst with CGI and a technology specialist at Endless Communications, focusing on network and security issues.

Christopher Collins, senior analyst, Anywhere Consumer research group, Yankee Group

Collins focuses on consumer research and analysis of market structures. Before his time at Yankee, he spent seven years in management consulting, corporate strategy and market research roles with companies including IBM and Accenture.

Claude Francoeur, partner, Ernst & Young

Francoeur started as a senior manager at Ernst and Young in 2009, but quickly expanded his role to become an advisory partner in the company’s risk practice.

Wayne Ingram, technology managing director, Accenture

Before becoming managing director of Accenture’s technology practice, Ingram had management responsibility for Accenture’s Network Technology practice in North America, helping high-tech companies implement next-generation network services. He has been at Accenture since 1987, and also helped to develop the local presence of Avanade, a joint technology solutions venture with Microsoft.

Krista Napier, senior analyst, Competitive Intelligence Practice, IDC

Napier focuses on monitoring the competitive dynamics of the Canadian IT sector. She tracks up-and-coming technology companies in Canada that promise to disrupt their industries, and also supports IDC Canada’s Market Acceleration Program, designed to help emerging Canadian IT companies succeed in bringing their products and services to market.

David Senf, research director, infrastructure solutions, IDC

Senf tracks servers, storage, networking, security, system management, operating systems and virtualization in his research practice at IDC. In the past, he has managed IT initiatives including Web portals and online presence solutions. He has also taught courses on SOA and XML at the University of Toronto.

Lawrence Surtees, lead analyst, IDC

Surtees manages IDC Canada’s communications research agenda. He has covered the telecommunications industry for more than 28 years, including 17 years as a reporter at The Globe and Mail newspaper. He began his journalism career in Ottawa in 1981, where he was editor of a weekly newsletter on communications policy and regulatory issues.

Paul Wood, senior analyst, MessageLabs

As senior analyst at Symantec-owned MessageLabs, Wood monitors and evaluates e-mail security trends. In the past, he has worked as a technical architect at technical training company QA plc.

Painting: “The Reader” by Jean-Honoré Fragonard / National Gallery of Art, Washington, DC

Illustrations: Jon Berkeley