New Zealand 2015: Cloud usage increase, IaaS slows, SaaS increases, big government chokes, small government sprints, AI emerges

flying car2015. Cloud services are likely to shift heavily from IaaS to SaaS and PaaS. Private companies will be brave while large government agencies will choke at the final decision points and small, agile, government agencies will streak ahead in delivering digital services. Dinosaurs will continue their slow route to extinction while the IoT things will be overshadowed by security scares but not enough to stop the second wave of Enchanted Objects. DIA will make gains in some areas and non-participants on certain services will be left behind and embarrassed. The Privacy War will continue and we’ll all be winners. Finally, Artificial Intelligence will start to emerge into our everyday lives, and more than just via search engine.

Take a deep breath and make yourself a cup of tea, this is going to be a long one.

The move to Cloud will roll on with almost every organisation now using some kind of Cloud service, and certainly 100% of their employees and customers using public Cloud in one way shape, or form. An easy prediction. What is a little more hard to gauge is the dropping of demand on IaaS and the increase of demand on first PaaS, and with more impetus, SaaS. Companies will figure it is easier to port an entire application to a SaaS services than to move the infrastructure layer, then the platform layer, and then the application layer.

Massive government agencies find themselves increasingly in a hybrid world, most of them by design. They will figure out that a workload focus is king, taking each workload and matching that to a range of local and international providers across the IaaS, PaaS, and SaaS offerings. Careful business case work by workload and clever design will allow a best of breed (hybrid) approach. Integration will be a nightmare with Enterprise Architecture having to drive their maturity up rapidly, or watch an organisation crash under complexity.

Speaking of maturity, Service Management will make a resurgence within organisations as a way to manage hybrid Cloud services that have largely been bought in via Shadow ICT. That small SaaS tool will become critical, hit the risk register, and demand it be integrated into the ICT organisation. Those without strong Service Management will struggle. Chief Executives will restructure CIO’s who can’t turn their operation into a service orientation. More money will be spent on trying to unlock this conundrum than the actual cost of the Cloud services.

Cloud skills will remain critically scarce within organisations and vendors.

Big government, with many layers of bureaucracy are going to continue to struggle on the Cloud journey. Overbearing commercial advice, lack of understanding of Shadow ICT, cultural issues, perceived security risk, interference by support agencies, reduced ability to buy hardware, lack of investment in applications, and a host of other nightmare scenarios are going to see larger government agencies hit stasis.

Meanwhile, smaller government agencies with less layers of management, newer culture, and a better risk appetite are going to consume Cloud and get on with the business of digital government. Applications specific workload based Cloud is going to allow them to do things that they haven’t before. That, coupled with less overheads, less interference from central agencies, and smaller teams are likely to deliver some quite remarkable public services. There are some very interesting applications in the pipeline. Services will be born and die in the Cloud.

New Zealand ICT companies will continue to be locked out of mega-contracts. The ruling government made a lot of noise about changing this during the election stage, meeting with many lobby groups and promising that all would be well after they got back in. Nothing has happened since then. We sit on a resource that is increasingly consumed overseas and with falling dairy prices and the USD coming down, gaining in importance, yet we won’t consume those services ourselves because of the dinosaur factor, and the plausible brand deniability. That brand deniability allows for an organisation to say “we chose the best in the world, what else could we do” when the project collapses in on itself.

Meanwhile, the ruling government will continue it’s focus on fiber, an adjunct in their mind to building more motorways, overpasses, and roads. Prices will increase as the Chorus model continues to wobble and the ICT Ministry will continue to post positive press releases about the number of properties fiber has gone past as opposed to the number that have connected.

The digital divide will increase.

The Internet of Things will continue to battle security scares, figuring out that this is largely propaganda by the mega-corps who are afraid of crowd-sourced sensors and devices when they stand to make extreme profits building the exact same devices. Local councils and cities will be the first wide-spread adopter of the Internet of Things, closely followed by consumers who will find pre-packaged devices such as cameras, climate control, where is my whatever, trackers, smoke alarms, security systems, weather stations, and plethora of other services.

All of which will start to look more and more like an emerging tech called “Enchanted Objects”. That being the turning of everyday boring objects into extraordinary objects. Lights, colours, less of the phone interface, more of “glance” technology, will start to emerge, somewhere down the end of the year.

Smart watches. A flood of them. None of them particularly smart.

Back in New Zealand the DIA will continue to turn the battleship from “you must” to a broker based model. The “you must” model will be largely gone by the end of 2015 and the service based model starting to emerge. Look for restructures that remove the dozens of commercial contractors and staff from both DIA and MBIE replacing them with a sensible, service focussed broker. Look for more guidance such as the Cloud Assurance Framework, that will save millions in consulting fees. Look for centres of excellence. Look for an easing of the seven hundred page contracts to relationships that focus on trust, openness, and transparency. Look for DIA engaging with their community and asking what it is they need, rather than forcing them to adopt things they don’t. Look for the larger naysayers to be left standing in the cold, gripping their servers with white fingers.

Well. A boy can dream, can’t he?

You’ll be sick of hackathons by the end of 2015.

The Privacy War will continue, and over the year CIO’s will realise they don’t always need a CISO, they don’t need a bunch of “security” consultants telling them what do to, and they certainly don’t need security causing more and more Shadow ICT. Security will be put back in it’s place. A risk based, audit group, that doesn’t have the capability to stop an organisation actually progressing, by crying wolf is unnecessary. Security teams that enable the business to exploit Cloud services will thrive.

An area that will remain weak is federation and identity access management. With more and more hybrid Cloud services the problem of security needing single sign on is going to rocket.

Stronger and more powerful security “as a service” systems continue to appear while the basic premise of Cloud providers is that you get better security by default. If the NSA debacle has done one thing, it’s increase security exponentially and will continue to do so. Much to the dismay of the Five Eyes and other spies.

In public Cloud, expect to see the major players introducing strong encryption for the home user as standard, it’s been a move this year, and will continue next.

The Five Eyes no doubt have yet another year of frog boiling planned, with more law changes in the pipeline. Watch to see government agencies and telecommunication companies hit churn as they try to interpret and work with the spies, who have now released so many differing directives that people are just going to need more mental health days I suspect.

ICT immigration and education are going to come up the priority list quickly. Immigration of ICT workers into New Zealand because of our current shortfall in some areas and education trying to, well, educate people. Which is an increasingly frustrating process as academics cling, generally, to their old style of education that does not suit modern ICT. Three year courses where the learning is redundant at finish are not popular. Free education via MooC’s will increase and the early universities to this model will kill the older dinosaurs who cannot adapt, rapidly. Small, boutique, agile, rapid educators will start to make their way into the market.

The Cloud Broker market is starting to bubble happily and early leaders like Fronde will find competition nipping at their heels already. Large ICT Cloud providers are now landing on shore or in Australia and partnering with anyone who will sign up while working back end deals with local providers. The broker market will need to adapt rapidly to ensure their relevance by the end of 2015 with far smarter and more advanced models including aggregated (and automated) product and service catalogues.

Integrators, the people who build bridges between Cloud, in-house, and other services, will be in more demand as the hybrid model expands. A relatively soft market, this is likely to pick up over the next year or two before automation can bridge hybrid with incoming tools.

Lobby groups in New Zealand will be business as usual. TUANZ will continue to remain stuck, limpet like, the side of the UFB whale. NZRise continues to grow and expand into a range of areas having very high political influence at a central and local government level with direct access to various politicians and councillors. NZ ICT will continue to advocate for the offshore Mega Corps that fund the model. IITP will continue its growth into a grey haired adviser status with strong impact on education and the continued push to IT Professional Certification, something that is badly needed, particularly for business owners.

Cloud will start to become more and more standardised with workloads traded the same way that other commodities are. Watch for an increase in Cloud workload trading markets and opportunities for customers to be able to seamlessly move workloads based on the best price for processor on the day.

Artificial Intelligence will start to fall off its current hype cycle. We can after all only write so many articles about Skynet. Intelligent systems will continue to permeate into end user applications, already a handful of companies and agencies in New Zealand are directly back ended into IBM’s Watson and Apple’s Siri. More stories about those in the new year.

We’ll see the continued failure of large scale public ICT projects. Private companies fail too, but they don’t have to tell us. All the ICT assurance in the world won’t make a blind bit of difference as we continue to stand up programmes and projects that are complex, expensive, and unwieldy. We will also start to see some success stories of those that have been brave enough to take advice on how to deliver projects better, faster, smaller, and with less risk.

BYOD will unlock mobility for agencies and private companies alike through the uptake of existing services such as DaaS.

China will start to emerge as a serious contender in the Cloud and ICT market. Massive investment and a low price point will drive particularly private companies to consider utilising those services. Security will be an initial concern that will be quickly overcome, given that everyone is spying on everyone and the tools exist to secure your data, regardless of location. The dragon is certainly stirring and it will have an initial impact in the Cloud wars, though not a great deal until 2016.

Hewlett Packard will be in trouble by the end of 2015 as it tries to pull itself to pieces and put itself back together in a different way in a very competitive and highly volatile market. They need Cloud service market share now, not to be splitting themselves apart.

Winners in 2015: Agile private and small government departments with a good risk appetite and low governance are going to be very well-placed to make significant progress against their competitors and deliver against government direction. Cloud storage consumers win with a continued race to the bottom. Security paranoid organisations win with a plethora of tools available to unlock forward progress. Local Government starting down the Internet of Things route are well-placed to move to Smart Cities. Cloud services brokers that take it to the next level of usability are in a good position. Integrators. Innovators. Collaborators. Start ups. Shadow ICT. Chief Innovation Officers. Service Management focussed staff.

Losers in 2015: Traditional IT Departments who say “no” instead of having a service management (broker) ethos will find themselves increasingly under pressure and finally swallowed by business led ICT through more organised models such as a Chief Innovation Officer. The bigger you are, the harder it will be to turn, leaving large government agencies and companies increasingly overtaken and harried by the smaller and more agile, big is not always best. Security analysts. Server administrators. Traditionalists. Dinosaurs. Control freaks. The risk adverse. Anyone who sells hardware. Anyone who wants a flying car. New Zealand ICT business trying to compete in Government. Government Commercial Contractors.

I think that’s me for the year. It’s been fun. Have a great Xmas and New Year. Thank you for all your feedback and your support (sometimes from the highest of levels, you know who you are). I’m learning just like the rest of you. Here’s to 2015.




  1. ‘Cloud as electricity’ – is centralised generation the way to go or … sudden thought .. what about local generation!

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