Gartner Warns to Cut Infrastructure Costs

ORLANDO, Fla.—If this is October, it must be time to truck down to Orlando to hear warnings, opportunities and forecasts from the Gartner analysts. All those elements were present as the annual Gartner Symposium/ITxpo got underway here on Oct. 9

The big theme this year for business IT was the need for techies to get off their butts and chase the consumer market. Consumer tech has outpaced business tech by creating blogs, social network sites, podcasts, search and video. Where’s business? Has it been asleep at the switch?

Yes, apparently, and the word from the Gartner oracles was to wake up and figure out how those consumer applications can be translated to the business world.

Maybe business hasn’t been sleeping so much as spending the boss’ money doing the wrong thing. Eight out of every 10 IT dollars spent on the enterprise are “dead dollars,” which keep the lights on but don’t directly contribute to a company’s growth, Gartner said.

With two-thirds of IT dollars going to keeping the infrastructure running, the amount of investment available for new projects is small, and within that small amount the percentage that could be called truly game-changing is smaller still. Get your budget for maintaining your infrastructure down from 80 percent to 60 percent or risk being left in the dust, the Gartner analysts claimed.

Click here to read more about why Gartner says consumer technology will form the next wave of enterprise IT.

And wait, there’s more bad news for IT departments. More and more executives are refusing to use the standard-issue corporate personal computer. The biggest offenders are C-level executives. In one of those stats that only Gartner can conjure up, the research company contended that 50 percent of C-level executives will perform 80 percent of their work on non-company-standard personal computers through 2008.

While notebooks continue to grow in popularity compared with desktop computers (and will represent half the computers bought by businesses in developed countries by 2009), the big game-changer coming is virtualization.

In a session on virtualization, Gartner Senior Vice President Thomas Bittman predicted massive changes for the user community and the X-86 server vendors starting in 2007 and accelerating from that point on. The ability to virtualize servers will result in a slowing down of hardware server sales as customers are able to get more useful cycles out of the boxes they are buying.

“Prices are dropping like a rock,” for virtualization software and licenses, Bittman said. Companies will embrace virtualization to cut hardware acquisition costs, ease management and build out a full-scale virtualized enterprise. The current leader in virtualization, VMware, could see its market share significantly eroded if it isn’t able to keep up the virtualization management software pace that will be set by competitors Microsoft and XenSource, he said.

While virtualization sounds like a panacea for IT costs, Bittman cautioned the audience to beware of software lock-in built around “sticky” management software.

The management of all those technology and business changes may be the biggest issue facing IT executives over the next five years, Gartner Research Director John Mahoney said.

Mahoney continued, “At least 60 percent of IT organizations in Global 2000 enterprises will divide into at least two organizations by 2012. One of those organizations will work on sourcing and delivery of infrastructure and another organization will work on architecture and change.”

Check out eWEEK.com’s for the latest news, views and analysis on servers, switches and networking protocols for the enterprise and small businesses.