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Keeping a weather eye on the information storm

Beverley Head, Information Age

13/06/2006 12:51:41

For the last 23 years George Colony's job has been to watch the horizon for clouds. The founder and chief executive of Forrester Research, Colony knows that when enough gather it means a technological thunderstorm is looming that promises to radically change the way people use computers and access information.

Colony says that there have been three such thunderstorms thus far - one for the mainframe era, one for PCs and another for the Internet or network computing era. Right now though, clouds are gathering again and Colony forecasts that another wave of massive change will get under way around 2008.

Just as previous technological dislocations have demanded radical change in corporate information systems infrastructure, so will this one, he warns.

Colony, who was on his first visit to Australia in 10 years, said that: "Right now we are in the second phase of the network computing era, but we are predicting a fourth wave of technology starting in about 2008 that will last for 15 years."

This next wave will also change the dynamics of computing with individuals rather than corporations taking the lead. Forrester refers to the phenomenon as "social computing" where people embrace blogging, use wikis, access podcasts, and interact directly with corporations and governments via the Internet.

At the same time Forrester is predicting that the number of devices connected to the Internet will explode, partly driven by RFID and sensors connected via the Internet, and partly by continued demand for Internet-connected devices especially from developing economies.

According to Colony the 1.6 billion devices connected to the Internet today will be eclipsed in just five or six years when he predicts there will be 14 billion devices hooked up. "From 1996 to 2006 the big change was that companies were connecting to their customers. By 2016 every company will be connected to every product they ever made as well. Imagine the demands that will place on IT."

Fast growing Internet shopping site eBay doesn't have to imagine. On a visit to Australia earlier this year its principal architect, Michael McIntire, explained that the company already has 300 million registered users, but was now scaling its computer and communication systems to be ready for an anticipated billion users. eBay runs one of the world's biggest data warehouses with 27 terabytes of data, and its data collection is increasing at a rate of 1.3 terabytes a month.

McIntire was having to rethink the way he tackled systems design and growth in order to cater to this surging demand while keeping a lid on expenses. To follow the linear growth that Moore's Law allowed was insufficient he said. Besides growing his infrastructure McIntire also has to recast the way he runs the systems - it is not feasible to grow IT headcount as fast as he needs to grow his systems, so a lot of the routine maintenance work has had to be automated.

McIntire's growth challenges will face more and more IS managers imminently according to Colony, who warns that "only 20 per cent of them are ready for this".

But nor are their masters. Colony likes to characterise IT people as "T-shirts", to describe marketing sales types as "Turtlenecks" and management as "Ties". It turns out that while only 20 per cent of the T-shirts recognise the looming thunderstorm, just 15 per cent of the Ties do.

Colony says it behoves the Turtlenecks to alert both groups to what is happening among their customers in order to be better prepared. As it stands Colony warns that there are "so few companies which understand how their customers are changing, especially the 13-22 year olds.

"There is an onus on the Turtlenecks to get in front of the Ties to say: 'Here is the customer and this is how it operates now".

Then it's up to the T-shirts to create an environment to support them. According to Colony it will be a radically different.

For one, he believes that the only environment which will support the rapid development needs, and meet the need to deliver executables over the Internet will have to be open source based. He believed that proprietary infrastructure advanced too slowly to meet the needs of future consumers.

Although open source agnosticism remains widespread in corporate Australia, Colony says that in the US the fact that it has been embraced by the IT savvy and fast moving financial services sector including companies such as Lehman Brothers and Goldman Sachs, and underpinned new age businesses such as eBay and Google, indicates how important open source will be in the future.

As a precursor to migration to open source Colony predicts there will be a period of standardisation and rationalisation of existing corporate infrastructure which will be "A five-year voyage for most companies." Then there would be a "Five year changeover from proprietary to organic IT".

In the past most online interactions between corporate and customer have been pushed from the corporation. But the emerging generation of consumers are far more tech-savvy, and smart corporations are recognising that and developing ways of accommodating it.

In April for example the venerable British broadcaster the BBC announced it would establish a forum where ordinary individuals could post their accounts of news event, or upload images taken on mobile phones or digital cameras.

Forrester predicts that consumers will also help steer product development by indicating what they want to suppliers, rather than have suppliers impose their will. It offers the example of confectionary giant Mars which asked consumers to vote online about a new colour for its M&Ms - attracting 10 million responses.

Forrester predicts that companies which recognise the potential of more intimate linkages with consumers will benefit in terms of lower product development costs; lower marketing costs; lower research costs; fewer lost sales and potentially higher margins.

For corporate IT departments the challenge will be to foster a technical environment able to support such dynamic interaction, ensure the security of personal information, manage and make sense of the vast amounts of data that this new dynamic will generate, and find individuals with the right IT skills to build such an environment.

No wonder Colony sees clouds on the horizon.