Welcome to the First Edition!

Welcome to the first issue of IDC Worldwide Vertical Markets Newsletter. Our newsletter examines recent events and offers opinions on key trends across 18 industries.   It is designed to enable technology buyers to engage with IDC Vertical Markets analysts, connect with colleagues, and share knowledge and best practices.  We appreciate your feedback - contact us at vertical_markets@idc.com and visit our online section at http://www.idc.com/vertical_markets/verticalm.jsp We hope you enjoy the content we have in store.

Recent Findings: The State of the US Business Analytics Market

by: Monika Kumar

Based on the most recent U.S. Vertical Market Research Group survey of more than 6,400 end-users, IDC has found that a third of organizations are unsure how to measure the benefits of business analytics projects and solutions. This rate is significantly higher in industries such as education, process manufacturing, and utilities and significantly lower in industries such as communications & media, securities & investments, and insurance.

Although business analytics and data management investments are expected to remain a high priority in 2010, research results suggest the potential to gain competitive advantage from an increased investment in business analytics is being hampered by a lack of effective measurement methodologies for the expected benefits of improved decision making processes. There are substantial opportunities across company size segments for more pervasive deployment of business analytics solutions within most companies.

The irony of this conclusion is clear. Technology vendors and consultants need to focus on applying business intelligence and analytics on the business analytics projects to ensure that BI groups are able to clearly articulate the benefits to their constituents and ensure ongoing funding of projects.

Spending intentions for 2010 investments in business analytics solutions are highest in the life sciences and securities and investment industries. The financial services sector as well as the manufacturing and resources sector also indicate above average budgets for business analytics in 2010.

The IDC study, 2010 State of the U.S. Business Analytics Market: and End-User Perspective by Vertical and Company Size, (Doc # 222573) examines business analytics technology purchasing and adoption trends across 18 industries and 5 organizational size categories. Conducted in late 2009, the study is based on an ongoing IDC Vertical Research Group survey of 6,483 end-users in the U.S.

 by: Angela Vacca

Why should European companies care about the services directive? The entrance into force of the services directive in December 2009 plays a crucial role for companies acting in the services arena in Europe as it makes complimentary circulation of services a reality.

In short, why is the services directive going to change the marketplace?

Easier geographic expansion across EU countries. The objective of the Services Directive is to remove legal and administrative barriers to trade in the services sector across the EU. Therefore the Directive is expected to reduce complexity of providing services within member states.

Higher quality. The regulation is expected to improve the quality of services delivered as it for example encourages voluntary certifications.

Administrative burden reduction. Businesses will be able to establish themselves anywhere in the EU - saving time and money as the Directive requires Member States to simplify administrative accomplishments and to provide on-line access to procedures.

Increased competition. Competition is expected to increase because, firstly, companies will move more easily across borders, secondly, the simplified regulatory environment is expected to encourage the creation of start-ups.

Reduced average prices for services: The Copenhagen Economics study forecasts that the Services Directive will reduce average prices for services. For example, prices of regulated services, such as legal and accounting, are forecast to decline by an average of 7.2%.

Increased turnover for the services sector: Improved quality of services, in combination with lower prices, is expected to encourage end users to engage in services, increasing turnover for the services sector.

IDC believes that these business changes will impact on professional services companies' organization, processes, corporate culture and, last but not least, on their ICT systems.   

To read more, find the full document M51S "The EU Services Directive: Its Impact on Business and IT Strategies of European Professional Services Companies" published on www.idc.com in March 2010 for further details.

Reaching Vertical Markets in Australia

by: Melissa Martin

A new vertical markets report shows a transforming marketplace in 2010, driven by a growing impact of the cloud services model, an explosion of mobile devices and applications and the continuing rollout of higher-speed networks.

According to the report titled Australia Vertical Markets 2010-2013 Forecast and Analysis: Update 1H10, this year will be one of modest recovery for the IT and telecommunications industries.

In times of global economic uncertainty, understanding and anticipating shifts in technology markets by vertical industries is critical for maintaining your competitive advantage. Suppliers must understand the strategic business issues and pain points of an organisation and the industry in which it operates, in order to demonstrate competence and value.

Imagine that you have a business problem and are evaluating companies to help you solve it. You can choose a generalist that claims to do everything for every scenario, or an expert that focuses on solving exactly the kind of problem you have, for companies just like yours, with a track record of success. Naturally, the expert, which demonstrates the advantage of vertical market knowledge wins the deal.

Based on IDC's updated forecasts, the business ICT market (hardware, services, software, and telecommunications) in Australia will grow from $45,195 million in 2010 to $51,829 million in 2013. Telecommunications will account for approximately a third (32.6%) of all ICT spending in 2010. This is closely followed by services at 31.1%, then hardware at 22.5%, and software at 13.8%.

Each year, IDC researches and reports on the 12 vertical markets that make up Australia's enterprise ICT market. From a vertical markets perspective, the top 3 positions in terms of ICT spending in 2010 remain unchanged and are held by banking, finance and insurance; government, and communications and media. The interesting point to note is that the manufacturing and business services has swapped places once again - with business services moving upwards in the ranking. Manufacturing was in 5th position in January 2009, moving to 4th position in June 2009 forecast and now back to 5th position in January 2010.

The top 3 positions in terms of ICT spending in 2010 remain unchanged. Banking, Financial Services and Insurance (BFSI) will spend $9,763 million; Government $6,214 million; and Communications and Media $5,608 million.

However, it is the Business Services, Construction and Manufacturing markets that are forecast to experience the fastest increase in ICT investment in the next few years - with respective compound annual growth rates (CAGRs) of 5.1%, 5.1%, and 4.7% in the forecast period of 2009 - 2013.

For more information on IDC's vertical market update including key predictions and Vertical Markets forecasts, please view Doc # AU8036602S, Australia Vertical Markets 2010-2013 Forecast and Analysis: Update 1H10, visit, http://www.idc.com/getdoc.jsp?containerId=AU8036602S