Sunny Side Up



Governments across the Asia-Pacific region are launching ambitious
e-government initiatives, using electronic technologies to improve both internal
operations and public service delivery. This is part of IDC’s recently
released ‘Asia-Pacific e-government strategies’ report aimed at examining
the impact of e-government initiatives in the region. According to its 2001-2003
IDC forecast, spending on e-government initiatives will claim a growing portion
of public sector IT spending in the years ahead.

ASP
Implementation Yields
Good
news for all advocates of and believers in the ‘apps on taps’
model–a recent IDC report indicates that utilizing the services of
an Application service provider (ASP) positively impacts an
organization’s bottom line. According to the report, ‘The
Financial Impact of ASP’, implementations tend to be an enormously
beneficial investment with an average yield of 404%.

IDC vice-president
(ASP and Internet services research) Meredith Whalen points out that
the ‘return’ in RoI means different things to different
companies.

  • ASP
    implementations generated an average five-year RoI of 404%, and
    almost half of the organizations in the study had payback within
    six months.

  • 44%
    of the organizations included in the study experienced an RoI
    greater than 100%, while 12% reported over 1,000%RoI.

  • The
    average payback for an ASP outsourced solution was 1.33 years on
    an average total investment of $4.2 million. The average initial
    investment was $399,000.

Explains Lisa Shishido, senior analyst, e-business and e-government, IDC
Australia, ‘‘E-governance is a key priority for many governments and the
spending is relatively stable, even in times of economic hardship. This creates
major opportunities for IT vendors and service providers as the public sector
seeks advice, products, services and partnerships in implementing e-government
projects.”

According to the report, while the governments in the Asia-Pacific region are
still in the primary stages of e-governance, the sophistication of their
services and systems will grow and new opportunities will emerge as they
progress along the e-governance maturity curve. The report also suggests that
there is growing realization amongst governments in the region that by adopting
technology they can reap the same rewards as e-business. These rewards include
more efficient business processes, improved public services and cost savings.
Amongst the five governments profiled–Australia, China, Hong Kong, Korea and
Singapore–the report suggests that e-government spending will grow the fastest
in China, at a compounded annual growth rate (CAGR) of nearly 40%.

US gung-ho on managed security services
While there is no denying that the US is going gung-ho about managed
security services, the most apparent opportunities for managed security service
providers (MSSPs) are within the small to medium-sized business market, where
customers have strong security needs, but limited information security skills
and resources. However, service providers must overcome issues such as the lack
of security awareness within an organization’s executive management and the
build-versus-buy scenario.

According to another IDC report ‘Reality or Illusion: Demystifying the
Managed Security Services Market’, the vendors not only need to educate
existing and potential customers, but also have an in-depth understanding of the
target market. These are two of the elements that would be crucial for both the
vendors seeking to introduce new offerings or those building upon their existing
business strategy in the managed security services market.

Explains Allan Carey, senior analyst, information security services research
service, IDC, ‘‘The managed security services market is being driven
primarily by resource constraints to capital and security expertise, as well as
the growing complexity of networks and rogue access points, which exponentially
increase exposure to vulnerabilities and threats.’’ According to Carey,
these factors combined are affecting the way organizations approach risk
mitigation. ‘‘Customers want information security solutions to seamlessly
integrate into the network, ensure scalability, and provide a measurable return
on investment,’’ he adds.

The IDC report also predicts that the United States market for managed
security services will grow from the $720 million figure in 2000 and touch $2.2
billion mark in 2005–a combined annual growth rate of 25.4%.

SHUBHENDU PARTH in New Delhi

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