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The wallet.

According to Gartner Inc., Stamford, Connecticut, worldwide enterprise information technology (IT) spending will reach $2.5 trillion in 2011--a 3.1 percent increase from 2010 spending of $2.4 trillion. Enterprise IT spending is on track to total $2.4 trillion in 2010--a 2.4 percent increase from 2009.

"Over the next five years, enterprise IT spending will represent a period of timid and at times lackluster growth, with spending totaling $2.8 trillion in 2014," said Peter Sondergaard, senior vice president at Gartner and global head of research, to an audience of more than 7,000 IT professionals at Gartner Symposium/ITxpo in Orlando, Florida, in October.

"Several key vertical industries, such as manufacturing and financial services, will not see IT budgets recover to pre-2008 levels before 2012 or 2013," Sondergaard said. "Emerging economies continue to be the locomotive of enterprise IT spending, substantially outpacing developed economies."

He added, "The transformation in IT spending will accelerate individual corporate change. We are on a one-way trip toward the IT-driven intelligence society--driven by the consumer--where growing access to this growing universe of data gives us the opportunity to not only make better decisions, but to make smarter decisions."

Sondergaard said, "At the heart of the change, the next 20 years will be intelligence drawn from information. Information will be the 'oil of the 21st century.' It will be the resource running our economy in ways not possible in the past."

According to Gartner, four broad trends will support change in IT and in the economy over the next 10 years:

*cloud computing;

*business impact of social computing;

*context-aware computing; and

*pattern-based strategy.

Cloud computing is a style of computing where scalable and elastic IT-related capabilities are provided "as a service" to external customers using Internet technologies.

"Cloud computing will transform the IT industry, as it will alter the financial model upon which investors look at technology providers; and it will change vertical industries, making the impact of the Internet on the music industry look like a minor bleep," said Sondergaard in his October speech.

The second major trend, Gartner believes, is the business impact of social computing. "Social computing--not Facebook[R], or Twitter or Linkedln[R], but the technologies and principles behind them--will be implemented across and between all organizations," said Sondergaard. "It will unleash yet-to-be-realized productivity growth [and] it will contribute to economic growth."

The third major trend affecting IT leaders is context-aware computing. Wireless technologies coupled with superintelligent devices such as notebooks, tablets and smartphones, linked to cost-effective computer and communication capabilities in all physical products, "has created a new Internet fabric," according to Gartner.

"This enables the creation of software and services that will blend data, text, graphics, audio and video with context such as location, language, desires, feelings. Services not imagined today will use people's location--whether physical or virtual--as the foundation, and then use data that determine your patterns of behavior, your desires," Sondergaard said. "Context-aware computing, while linear in its impact on IT, will have profound impact on organizations [and] on the way we do business."

The last trend, pattern-based strategy, "provides a framework to proactively seek patterns from traditional and non-traditional sources, model their impact, and adapt according to the needs of the pattern," Gartner explains. It builds on pattern-based technologies such as social network analysis, context-aware technologies and predictive analytic tools.

"The combination of these four trends creates an unimaginable force impacting not just IT and the IT industry, but the capability of business and government," said Sondergaard. "Each of these four trends is about driving IT business value. Whether IT acts now or not, the combination of these trends will drive dramatic change in your enterprises' business model and strategy."
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Title Annotation:Gartner Inc
Publication:Mortgage Banking
Geographic Code:1USA
Date:Dec 1, 2010
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