Cloud 2.0 and Open API - IDC's 10 predictions for the NZ IT industry

International Data Corporation (IDC) has announced its New Zealand IT industry predictions for 2018 and beyond.

This year's predictions reflect the maturity and growth of New Zealand's digital economy, with many organisations accustomed to leveraging powerful digital innovation platforms.

"With third platform technologies (cloud, mobility, big data and social) now deeply embedded into New Zealand organisations, CIOs and digital leadership teams are now ramping up investment in the digital economy opportunity," says IDC New Zealand senior research manager Louise Francis.

"Digital natives are here and companies must now act like a digital native by investing beyond third platform technologies. It is no longer about piecemeal investment but large-scale investment taking advantage of the foundations that have been laid down over the past five years."

1) Digital transformation (DX) Economy Tipping Point - by 2021, at least 50% of New Zealand's GDP will be digitised, with growth in every industry driven by digitally enhanced offerings, operations, and relationships; by 2020, investors will use platform, data value, and customer engagement metrics as valuation factors for all enterprises.

2) DX platforms - By 2020, 60% of all NZ enterprises will have fully articulated an organisation-wide digital transformation platform strategy, and will be in the process of implementing that strategy as the new IT core for competing in the digital economy.

3) Cloud 2.0 - distributed and specialised: By 2021, enterprises' spending on cloud services and cloud-enabling hardware, software, and services will more than double to over NZ$2.6 Billion, leveraging the diversifying cloud environment that is 20% at the edge, over 15% specialised compute (non-X86 compute including GPUs, TPUs, FPGAs, and quantum computers), and over 85% multicloud.

4) AI everywhere - By 2019, 40% of digital transformation initiatives will use AI services; by 2021, 75% of commercial enterprise apps will use AI, over 75% of consumers will interact with customer support bots, and over 50% of new industrial robots will leverage AI.

5) Hyper-agile apps - By 2021, enterprise apps will shift toward hyper-agile architectures, with 90% of application development on cloud platforms (PaaS) using microservices and cloud functions (e.g., AWS Lambda and Azure Functions) and over 95% of new microservices deployed in containers (e.g., Docker).

6) Human digital interfaces - By 2020, human-digital interfaces will diversify, as 20% of field service techs and 20% of info workers use augmented reality, nearly 30% of new mobile apps use voice as a primary interface, and nearly 40% of the consumer-facing NZX50 use biometric sensors to personalise experiences.

7) Blockchain and digital trust - By 2021, at least 25% of the NZX organisations will use blockchain services as a foundation for digital trust at scale.

8) Everyone's a data provider - By 2020, 75% of large enterprises will generate revenue from data as a service, from the sale of raw data, derived metrics, insights, and recommendations, up from nearly 30% in 2017.

9) Everyone's a developer - Improvements in simple, "Low Code/No Code", development tools will dramatically expand the number of non-tech developers over the next 36 months; by 2021, these nontraditional developers will build 15% of business applications and 25% of new application features.

10) Open API Ecosystem - By 2021, more than half of the NZX companies will see an average of one-third of their digital services interactions come through their open API ecosystems, up from virtually 0% in 2017, amplifying their digital reach far beyond their own customer interactions.

"Many New Zealand organisations have already reached a level of technological maturity to advance to the next stage of digital evolution, becoming a true digital native," says Francis.

"The only things that can hold them back will be an innovation impasse caused by legacy systems constraining transformation and a lack of business vision. However, 2018 will provide the opportunity for all organisations to unleash digital innovation's power for digital-centric transformation altering business and society at scale."