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Indian IT players need to invest in creating IP: Crawford Del Prete

Interview with executive vice-president, worldwide products, and chief research officer, IDC

Crawford Del Prete

Shivani Shinde Nadhe Pune
Crawford Del Prete, executive vice-president, worldwide products, and chief research officer, IDC, believes social, mobile, big data and analytics are changing the technology landscape. He predicts that by 2018, almost 30 per cent of technology suppliers will be threatened or disrupted by third-platform competitors.

In an interview with Shivani Shinde Nadhe, Prete says the Indian information technology (IT) sector needs to invest in intellectual property, change their perception in global markets and inculcate skills to address this changing landscape. Excerpts:

How does IDC define the third platform and how significant is the shift?

We define the third platform as bringing together of technologies such as cloud, mobile, social, big data, and analytics. It was in 2007 that the third platform started to emerge. It was when Apple launched iPhone, Facebook started to receive traction out of campuses, and Amazon Web Services adoption saw an uptick. We started to see the forces coming together and changing the ecosystem. And then, as cloud started to gain traction, you had all others joining in, such as Microsoft jumped in with Azure, Google started and others too.
 
The adoption of the third platform is phenomenal. We predict that the first platform (which consists of mainframe computer systems) and the overall IT market between now and 2019 will have a compound annual growth rate of around four per cent. The second platform (the client-server system) will have a growth rate that is flat or a decline of about two per cent. The third platform will experience a growth rate of 12-14 per cent. It will represent all of the growth in the IT space. And companies that are not investing in the third platform, either the supplier of technology or companies participating on that platform, are going to be passed by. We believe that by 2018, across all sectors, 30 per cent of established suppliers will be disrupted or threatened by third-platform competitors. Some companies in this space include Uber and Airbnb.

There is a buzz around cognitive computing, how it is being driven by the third platform.

Cognitive computing and augmented reality are already coming into the consumer space. This year, everyone is focused on wearables. We believe that one of the interesting applications for wearables will be glasses. Google Glass was an experiment, but Microsoft is working on HoloLens (a glasses-driven three-dimensional (3D)/hologram environment), and Facebook acquired a company called Oculus VR. We believe that in commercial applications, there is an opportunity to automate and become much more efficient. We believe by 2020, the number of knowledge workers will be reduced by as much as 15 per cent due to the use of cognitive computing and augmented reality.

I think such technologies can transform processes such as maintenance jobs. An example of how this may be used is when a consumer buys a piece of furniture from Ikea. By paying a few more dollars, a customer can initiate a call with an Ikea engineer and receive help in assembling a piece of furniture.

How do you see the Indian IT supplier fitting into this changing landscape?

By and large, Indian suppliers have started to think in these terms. The bigger challenge around the world is that Indian suppliers are not thought of as players who have this capability. Indian companies need to provide more proof points of how they have helped clients transform. Indian players need to do a better job there.

How do you see the traditional and new giants changing the technology landscape?

The Googles and the Amazons will try to sell offerings that provide application-level functionality on top of their infrastructure. This is already happening. Google’s effort to get into the enterprise segment is an example.

The IBMs of the world will focus on providing sophisticated automotive services that will allow them to leverage their capabilities in cognitive computing, such as IBM’s Watson offering. IBM-Apple is one such tie-up. This will not only create new revenue streams, but also drive efficiencies.

As for Indian suppliers, they will scale up to the consulting and transformation space, but Indian companies need to invest in creating intellectual property. They need to think about how they can automate more of their services to drive profitability.

Recently, Infosys acquired Panaya, an automation technology supplier. Do you think acquiring such firms will help Indian companies shift to cognitive computing?

I believe that Indian suppliers are underestimating how complex it is to sell this new story, and how they need a new language. I think one of the other things that Indian IT players should do is add different partner-level selling skills to change the conversation from cost-saving to innovation.

What are the challenges for firms adopting the third platform?

One of the challenges is these move very quickly to the third platform without thinking about the second platform infrastructure, which ends up creating a mess.

The other challenge is the difficulty to have line businesses to work with IT. They see the IT department as a place where you get your personal computer or your applications fit. So, what you get is a sprawl around the organisation which is not integrated with the IT environment. Companies need to get chief innovation officers who can understand these things. This means a big shift for the supplier in selling technology.

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First Published: Feb 28 2015 | 12:49 AM IST

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