Tech Trends 2006

Technology and business developments that will define the industry, direct
enterprise strategies, and shape consumer lifestyles

As we took stock of some trends which would
make the most impact this year, there emerged a clear divide between the hot and
the new. While on one hand there are 'hot trends' that already exist in the
market but are expected to significantly ramp up and move towards mainstream
adoption in 2006, on the other are the 'new trends' that are slowly getting
a foothold in the market.

Overall, the market is abuzz with excitement as the year
opens up to some frantic activity on the wireless front. While enterprise
mobility will be the buzzword with enterprises extending information and data to
the wireless domain, there will be a growing number of security concerns that
the CIO will have to address this year. On the home front, the digital lifestyle
is becoming a more grounded reality. Surrounding this digital revolution will be
a plethora of burgeoning markets like electronic gaming, MP3s, LCD displays, et
al.

On the computing front, while desktops move in the direction
of keeping to the bare minimum to make low-cost computing a reality, laptops are
lapping up the need for high performance with the introduction of dual core
processing.

Technology will continue to move at a rapid pace, forcing
increased focus on inherent issues of management, maintenance and security. As
enterprises wake up to these concerns there will be dynamic shift in the way
these companies devise their strategies. Email management and SOA are among the
trends that will define the enterprise space in the coming year.

Mobile Apps

Gung Ho on Gaming

India's just about building up an appetite for gaming. Even though the
phenomenon of gaming, in India, may never really match up to its US counterpart,
it is becoming an integral part of India's digital lifestyle. The year 2006
marks the crossover from gaming being a niche area to its mainstream uptake in
the country with large-scale adoption of gaming devices/consoles.

Whetting this growing appetite will be some exciting new
offerings which will hit the market in 2006. Sony's PlayStation 3 and
Nintendo's Revolution game consoles will be released during the year,
competing with Microsoft's XBox 360.

Mobile gaming has the potential to define and lead the
Indian gaming market over 2006, primarily driven by the growing mobile phone
market and falling prices. With the introduction of more sophisticated handsets
and games, coupled with faster networks, mobile gaming is becoming as
wide-ranging and mature as PC gaming. Growth in the wireless domain will lead to
the usage of a range of new devices other than mobile phones.

Work Smart, Phone Smart

2006 is the year to 'work smart' for the enterprises as 'enterprise
mobility' becomes the norm this year, and more enterprise applications find
their way into the mobile territory. However, the year 2006 clearly belongs to
email over mobile phone-though the momentum started last year, it will really
catch steam and start ramping up among Indian enterprises only in 2006. 

Telecom biggies like Airtel and Hutch actively pushed their
respective solutions- Blackberry and Hutch push email-last year, which will
bear prominently visible results this year in the form of huge volume ramp-ups.

What makes this segment hot is the emergence of the whole
concept of enterprise mobility, bringing in its wake a growing mobile workforce
that needs an access to data while on the move. One of the biggest drivers for
mobilizing email is the ability to stay connected to email, which is a key
enterprise communication medium and has a high impact on productivity while on
the move.

There is likely to be a spurt in the number of devices
contending for enterprise applications access this year. Email is just the
beginning, with more applications to follow suit as the year progresses.

IM-Voice: Chat Reality

Skype, Google Talk, Yahoo voice chat-names one happened to hear a lot
last year. But more than the hype, IM-Voice or voice connectivity in instant
messaging is a reality to live with in 2006 that will change the way we have
been communicating. It may not completely re-define the way we communicate,
considering that PC penetration is still too low to warrant a change to that
extent, but 2006 may well turn out to be the change agent initiating this whole
process of transformation. So telcos can look up and acknowledge possible future
competition.

Tackling security issues, enterprises in India will get onto
the IM-Voice bandwagon as an alternative tool for more effective low-cost
communication. On the consumer front it will emerge as one of the primary tools
of communication.

The recent players in the IM-Voice arena are Sony IVE and
Peer Me. A more competitive scenario will further lead to improvement in quality
of service as well as introduction of more value added features over the year.
Though still a long way away to threaten the traditional telephony systems
Instant messaging will nevertheless be a force to reckon with in the year 2006.

Storage Capacities

HDDs Race for Higher
Capacities

The only thing constant is change. A law that holds very true for Hard Disk
Drive capacities. The race for capacity landmarks will continue through 2006
with vendors vying to outdo each other. While there are no fixed predictions on
the maximum that HDD capacities will touch in 2006, one can expect some
significant capacities resulting from the expected spurt in storage
requirements. The terabyte ceiling has already been broken in external drives
beginning with Maxtor announcing an upto 1 TB capacity external drive. For
internal hard drives the capacities are likely to reach the 650 GB to 750 GB
range.

The first of the drives based on the perpendicular
recording technology, which has the potential for major capacity boosts, made
their debut in 2005. This is likely to catch momentum in 2006 with more products
incorporating the technology, leading to capacity leaps this year. The
perpendicular recording technology increases the capacity of a platter by 10
fold. However, drives based on this technology are not likely to appear in
desktops before 2007, and are more likely to be slated for the iPod-size,
1.8-inch kind of hard drives to begin with.

HDDs and the Digital Market

HDDs in consumer electronics is nothing new, but during 2006 one will see
vendor focus intensifying in this space. Experts believe that vendors will be
relying on the digital consumer electronics market to drive this year's
growth.

HDDs are already finding their way into digital video
recorders, digital music players, mobile phones, high-definition TVs, gaming
devices, digital camcorders et al. The trend will become more pronounced this
year with these devices demanding higher capacities and smaller form factor HDDs
becoming readily available. There is an expected increase in shipments of 1-inch
HDDs, heralding good news for vendors with an eye on the consumer electronics
space. One is likely to see ultra-tiny hard drives (10-40GB) finding their way
into cellphone/music player/videocam hybrids over the year. Consumer electronics
may not be the most noteworthy market for HDDs, but it's likely to be the
flavor of 2006. The small form factor HDDs will, however, continue to face
competition from alternatives like flash.

Are Superdiscs the Answer?

The capacity marathon is on in the optical media as well with products based
on the Blu-Ray Disc and the HD-DVD formats becoming a reality in 2006. While the
prototypes have been launched in the latter half of 2005, the first commercial
products will hit the markets only this year.

These next-generation optical disc formats promise to break
the capacity barriers. Whereas a single-sided, standard DVD can hold 4.7 GB of
information only, these two formats offer much higher capacities. A single-layer
Blu-ray Disc can hold 25 GB, which can be used to record over 2 hours of HDTV or
more than 13 hours of standard-definition TV. There are also dual-layer versions
of the discs that can hold 50 GB. Though HD DVDs come with lower capacities they
offer the advantage of low manufacturing costs, as the HD-DVD media is
technically similar to standard DVD media. As a result, the discs can be
produced with only a slight modification to existing manufacturing lines.

The debate on formats is likely to heat up further in 2006
as the first of the product betas have started making their way into the market.
The year is likely to turn out to be the defining one in determining which
format will finally emerge the winner.

The Indian WiMax Scenario

Heralding WiMax

With the mobile WiMax standard ratified and designated 802.16e in Dec 2005,
we will now see the real momentum pick up in the WiMax space. Standardization
will enable vendors build equipment that are interoperable with equipment from
other vendors. This will also mean that equipment manufacturers of say laptops
will now be able to develop products based on the technology.

The market in 2006 will be abuzz with a lot of activity
around product development and certifications, leading up to the actual uptake
by 2007. As a result, this year will be crucial in determining the way things
are going to shape up in the WiMax space in the future and will set the pace for
wireless broadband.

Companies are particularly gung ho about developing
countries like India, where WiMax is seen as the way to alienate the last mile
problem of telcos and cellular providers. As a result of this a number of WiMax
stakeholders will be keeping a keen eye on the Indian market as well as on
India's regulatory and spectrum allocation scenario.

Up Ahead: The 802.11n Standard

2006 is an exciting time for the wireless industry as the year is likely to
witness the standardized next generation of Wireless LAN, 802.11n. The Standards
Board Review Committee of the Institute of Electrical and Electronics Engineers
(IEEE) is expected to finally ratify 802.11n towards the latter half of the
year, which will see products based on this version hitting the market.

With high WLAN data throughput, this holds good news for
the next generation of wireless applications. Backward compatible with
802.11g/b/a, 802.11n can almost quadruple Wi-Fi speeds. Apart from network speed
it aims to increase network reliability, and extend

the operating distance of wireless networks. While the current WLAN standards
such as 802.11 a/b/g offer performances adequate for today's wireless
networking applications, they will not be adequate as next generation wireless
applications come. The 802.11n standard will also support all major platforms
including consumer electronics, personal computing, handheld platforms, and will
be usable throughout all major environments including enterprise, home, and
public hotspots.

Data Cards vs Hotspots

While the Indian hotspot scenario is looking up for the year 2006, hotspots
are in for some competition from the burgeoning wireless datacards. Irrespective
of which of the two emerges as the most popular wireless Internet access mode,
the user will ultimately be the winner enjoying the more commoditized pricing. 

While most premium hotels and a few airports already boast
of hotspots, coffee shops, restaurants and smaller city airports are the next to
have them this year. One expects airports in smaller cities to also go for Wi-Fi
hotspots. Coffee chains like Café Coffee Day are already offering the service;
soon many other coffee shops, restaurant chains, clubs, etc are expected to join
the fray. The change in government regulations last year, opening up the
frequency bands for unlicensed devices, are likely to have a ripple effect on
the hotspot population this year.

Wireless datacards got off to a good start in the Indian
market and will gain momentum in 2006 considering the advantage they offer of
anytime anywhere access-and no disruptions due to hotspot unavailability.
However, Wi-Fi hotspots have an edge in terms of higher speed than CDMA/1X or
GPRS, which are in the region of 50 to 70 kbps.

Hungry for Bandwidth

Broadband for Homes

Broadband in India is to become a mass-market game this year considering the
growing appetite for high-speed Internet access among Indian homes. Broadband
became the buzzword last year, the year starting with the launch of broadband
services by BSNL and MTNL, thereby shaking up the entire industry and allowing
for a much larger playing field.

The result, a growing commoditization of high-speed
Internet access. This process, which already started last year, will gain ground
in 2006 with a more competitive pricing scenario. This, in effect, will lead to
broadband gaining firm ground in the Indian market. The growing popularity of
high bandwidth applications in the home segment will further drive broadband
more rapidly into the home territory. Time also to look out for some fireworks
as market players slug it out to capture the maximum share of the bandwidth
going out to consumers.

10G-over-UTP

While wireless is the buzzword in 2006, it's not all mum on the wired
front as rapid developments and newer technologies enter the Indian market. With
a few early adopters for 10G-over-UTP last year, the ground has been laid for a
rampant adoption of 10G in structured cabling by enterprises. It will find its
takers among some bandwidth-intensive businesses as well as data centers. As
more applications in the enterprises demand higher bandwidth and speed, 10G will
find wider acceptance during the year.

But, will 10G give fiber a run for its money? Not in 2006
for sure. However, the competition cannot be denied considering the advantages
in terms of lower equipment costs as well as relatively lower costs of
installation and maintenance. From generating interest to gaining a significant
share of the structured cabling market, the growth trajectory is all set for 10G
in 2006.

High-performance Laptops

After dual-core in servers and desktops, it's now time to experience some
high performance computing on laptops this year. Intel's launch of its
Centrino Duo Processors is seen as one of the biggest developments for the
mobile platform since Wi-Fi.

The newly launched processor runs two cores at the same
speed, paralelly. This obviously means that more processor intensive tasks can
take place at a time resulting in better performance. Intel claims that new
technical advancements enable the Centrino Duo to perform better by almost 70%,
compared to earlier processors. This will give a boost to processor-intensive
applications that require multitasking performance-meaning that one can watch
movies, play games, surf the Net, all at the same time without compromising on
performance levels.

Laptop vendors have already started showcasing their
offerings powered by the Centrino Duo processors. Is dual core then the face of
things to come?

Enterprise Realities

Managing Email

According to industry experts, email volumes currently stand at 56.3 bn per
day as opposed to just 9 bn per day in 1999; it is further expected to undergo
three fold increase in the next 2 years-to 163.4 bn emails per day by 2007.
Managing this huge volume of emails is going to be one of the biggest concern
areas for the enterprises in India, as awareness levels increase.     

One can expect a sizeable number of corporates devising
specific email management strategies to tackle this issue. This includes
separate policy on effective archiving, deletion and retention, assessment of
storage requirements, as this is the most important chapter in effective email
management, defining email archiving and retention policies, email audits, etc.
This year the CIO gets to the task of living well with emails and making the
most out of this big repository of key corporate information, intellectual
property, and data.

Service Oriented Architecture

In the enterprise segment, Service Oriented Architecture (SOA) is finally
becoming a reality. This is the year we get to see SOA working for the business.
Companies worldwide are already taking the first steps towards adopting an SOA
approach. The Indian market will find some early takers who will be aligning
their IT with service oriented architecture.

With growing awareness levels, SOA will emerge as one of
the hottest buzzwords in the enterprise circles in 2006. One of the key factors
driving SOA will be the need for cross-platform integration. SOA offers the
ability to effectively integrate the disparate systems and applications existing
within their enterprises, thereby leading to cost savings and improved
efficiencies. SOA is an infrastructure strategy that relies on middleware and
allows existing applications to share data.

Security Challenges with Mobility

As mobility becomes the buzzword for 2006, what follows is an increase in
the number as well as variety of security threats and concerns that the CIO will
face. As a result, the rapidly evolving mobility environment will emerge as a
major security concern. There will be significant increase in corporate
information moving into the domain of the mobile world. As this trend continues,
the threat to security and privacy will also increase in tandem, and expand to
mobile devices.

Enterprises that are planning to significantly leverage the
mobility wave will be developing security strategies specifically around their
enterprise mobility initiatives. This will force a slew of new mobile and
wireless security products in the market this year. However, with devices
leaving the safety of the corporate control environment, the information assets
and intellectual property they carry are increasingly becoming the
responsibility of individuals to protect. This is one area that many
organizations are yet to fully accept or anticipate.

Market Truths

Compliance Driven Security

The concern over worms and viruses has not abated nor are the hazards from
these traditional security concerns getting any less. However, the market is
undergoing a fundamental change. It's re-defining the dynamics of the security
market as regulatory compliances take the lead as a more important and critical
driver of information security, surpassing worms and viruses-as revealed by a
recent Ernst & Young survey report.

The need for compliance with regulations like
Sarbanes-Oxley, Clause 49 of the listing agreement, etc is going to be the
primary concerns addressed by the information security initiatives of
organizations worldwide. The trend will be reflected in the Indian market as
well through 2006 as awareness levels, with respect to regulatory compliance,
increase. While one is likely to see the security strategies of enterprises more
strategically aligned to the regulatory compliance requirements in 2006, there
will also be a spurt in information security services and products specifically
built around meeting compliance issues as the year progresses. Though not
forgotten, worms and viruses will have to wait.

Low-cost Computing

While 2006 is the year of converged devices and smart phones, it is also the
year when low cost computing gains prominence. Will the PC become commoditized
and will the digital divide get bridged through low-cost PCs, are big questions
making the rounds. Though 2006 may be too soon to answer these questions with
accuracy, the year will surely build on the low-cost computing wave which took
off last year.

The sub-10k PC is already a reality but the reality will
gain better ground this year as more PC vendors jump on to the low-cost
bandwagon. In 2005 the low-cost PC attracted more hype and attention than actual
adoption. But, this plain vanilla, no-frills PC may finally take off this year
as the market gets over the initial hiccups and the (over)hype surrounding it
settles down. Also, one expects to be offered better than the existing
configurations when vendors get their marketing machinery into action.

The LCD Explosion

While bulky looking CRTs may still rule the market in India, their
sophisticated, and lighter, counterparts, the TFT LCDs, have started their march
towards a mainstream identity-shedding off their niche image.   

Last year, the latter witnessed a good traction from market
segments like BPO, BFSI and retail. The year 2006 will build up on the 'thin
is in' market mood with a ramp-up in numbers. Vendors are quite upbeat about
the LCD market considering that the next level of incremental growth is expected
to come from here.

The increasing demand in 2006 will be primarily driven by
declining prices, which is expected to be steeper in the 17-inch and 19-inch
space. The affordability factor coupled with the desire of moving towards a more
digital lifestyle might enable LCDs to conquer the market this year.

Shipra
Arora 

shipraa@cybermedia.co.in