The changing tide

The changing tide

2010 should be a year of expansion and transformation

This time last year, concerns over the dour economic climate cast a looming shadow across the IT industry and Australian channel organisations. But signs of returning optimism indicate 2010 will be a year of expansion, rather than contraction.

One clear sign that the market is recovering well and businesses are looking outwards, rather than inwards, is the recent spike in jobs (see page 1). According to Hudson and Olivier reports, both employee sentiment and the number of employers looking for extra hands leapt up in the last three months of the year.

The results complement the Australian Bureau of Statistics’ November jobs report, which showed a surprising 5.7 per cent jump in the number of people employed across the country. Putting it another way, 31,000 people were added to corporate payrolls in just one month.

Several services providers ARN spoke to about the jobs situation flagged plans to expand headcount and bring on new talent to take advantage of opportunities in applications development, convergent technologies, services and support. All attributed their decision to returning market confidence and subsequent customer demand for IT solutions to meet expected growth.

Another confidence indicator is the number of integration companies boasting of stronger and more diverse project work. In their preliminary financial reports for the six months to December 31, ASX players Data#3, itX and ASG cited increased customer spending and project opportunities as driving solid results for the first half of the year. Notably, acquisitions were being sought by itX and ASG. Informally, at least two tier-two organisations I’ve spoken to in recent weeks have also expressed an inclination to buy and expand their geographic or skills base.

But while things are certainly much brighter today compared to 12 months ago, there are transformative technology changes within the IT industry itself which could influence the way the channel makes money and services its customers in 2010.

Cloud computing and as-a-service technologies, for example, were discussed at length last year, and will continue making headlines this year as more corporates become familiar with the concept.

And there are plenty of new beginnings too. The vendor landscape, which altered dramatically over 2009 through mergers, acquisitions and overall consolidation, will solidify this year as organisations such as Avaya (through its Nortel buy), Cisco (through Unified Computing Systems and its Tandberg purchase), Oracle (with Sun) and HP (via 3Com) layout their roadmaps and redraw the battle lines.

Watch out for all the latest analysis in the next, newly formatted edition of ARN on February 10. Our new fortnightly frequency will give us the opportunity to present you with in-depth Australian market, business and technology insights and keep you on the ball in 2010.

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