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Off premise and away as NZ businesses commit to the cloud

Off premise and away as NZ businesses commit to the cloud

"New Zealand organisations are committed to shifting their IT needs off premises and into the cloud."

Off premises IT services (e.g. hosted applications and infrastructure) in New Zealand are forecast to grow 7–9 percent each year until 2019, based on this year's NZ IT Services Market Analysis and Forecast report from IDC.

The big winner will be cloud-based services, which will grow at a staggering 15–27 percent compound annual growth rate (CAGR) until 2019.

“New Zealand organisations are committed to shifting their IT needs off premises and into the cloud,” says Donnie Krassiyenko, IT Services Market Analyst for IDC.

“There is a strong appetite for services that drive cloud and cloud integration, as well as investments in a strong network to enable these solutions.

“At a business level, it is all about mobile applications transforming the way in which business connect to its customers via its staff and ongoing digital engagement.”

The IT services market for New Zealand grew at a conservative level of 1.9 percent for 2014 (year on year) but IDC is forecasting annual growth rates of 2.6 percent each year until 2019.

Krassiyenko believes this uplift reflects the massive transformation that the market is realising as organisations take to a hybrid style infrastructure model with wider technology adoption across the organisation.

IDC's market share analysis found that Datacom is now the largest IT services provider (incl. business consultancy services) in the New Zealand market.

Its strong representation of IT services across Systems Integration, IS Outsourcing, and Application Management has driven the company's increased market share, with the major industry penetration in Government, Communications and Media, and Finance sectors.

Krassiyenko says one of the key drivers of these growth trends is the notable improvement in the number of New Zealand organisations expanding ICT budgets over the past year.

In the IDC's 2015 Asia/Pacific C-Suite Barometer, 19 percent of companies stated that budgets were increasing this year.

In addition only 16 percent of the New Zealand organisations interviewed stated that lack of ICT budget for the business requirements is a top challenge in leveraging ICT to drive business forward.

“IDC is also seeing the power partnership of the CIO and CMO beginning to form,” adds Adam Dodds, IT Services Research Manager, IDC.

“Marketing understands the value of leveraging information to drive stronger customer engagements however to do this in a way where applications are integrated and information is well governed the value of the CIO is critical.”

According to Dodds, New Zealand end-users have indicated to IDC that the investment focus for the coming 24 months will be targeted across the following areas:

• Cloud - Data centre migration

• Mobility, including virtual desktop infrastructure (VDI)

• Unified communication and collaboration

• Data analytics


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