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But, rest assured, in the IT world it remains true that as one door closes a few dozen more always open. This year will be no different. Virtualization, encryption and multicore processing will certainly help spur a lot of buying in 2007. And VoIP? It's not as if it has lost its luster among companies. If anything, the rising profile of unified communications will spur VoIP sales in the channel, it's just that it'll have to be positioned as a broader collaboration solution that incorporates video and mobility features.
2007 looks to be another year of consolidation in the channel, especially in the storage market. And managed services is an area undergoing huge changes, as MSP-ready platforms arrive on the scene and MSPs demand improved technical training, partner support and simplified product sets from vendors.
In the following pages, we take a look at six segments—hardware, managed services, networking, security, software and storage—to see what's important for solution providers to know as the new year unfolds. The year may just be beginning, but the trends are already visible. Read on and get ready for 2007.
Hardware: Quad-Core Encore In '07
Many solution providers and system builders say they're not expecting much impact right away from Vista, which requires 2 Gbytes of memory just to perform basic functions. But the market itself is expecting a huge spike in the amount of DRAM that will be needed to make Vista PCs run—adding to a growing belief that some PC prices may start to rise in 2007 for the first time in years. Keeping ahead of the curve early on DRAM supply could help out with a crunch later on.
Competition could start to heat up in the data center as well, where AMD, Intel, tier-one server vendors and system builders are readying for a potentially massive change. Evidence indicates that a surge in the number of servers used for VoIP and communications is continuing—American Power Conversion says half of all new kilowatt hours going into small data centers are for switches targeted at VoIP deployments. And with four-core processors, new cooling technology and blade offerings, the push will be on to migrate small, medium and large enterprises. Look for the disruption to build gradually through mid-2007, when AMD begins shipping its first quad-core chips following Intel's ramp, which started in 2006.
The peripherals segment isn't just growing—it's getting wider—as in "wide-screen" displays. As 2006 ended, indications were that sales of wide-screen displays would start outpacing "square-screen" displays in PC bundles and as upgrades. Many in the market are finding out that with more LCD real estate, they can simply get more done. And solution providers can get a slightly wider margin as well—at least early on.
OUT
• Square-screen displays: Gone the way of the CRT
• Single-core processors: Soooooo 2003.
• Dell's brute strength over system pricing: It's now the No. 2 PC company for a reason.
IN
• Wide-screen displays: Watch your Skype calls, YouTube vids and Excel docs with room to spare.
• Quad-core processors: Sure the market only needs two cores now. But it can't hurt to plan ahead.
• HP's brute strength over system pricing: Chairman and CEO Mark Hurd has vowed to stay tough in'07.
The world is headed toward a quad-core encore in 2007, as chip makers Advanced Micro Devices and Intel move their fight beyond dual-core platforms. But the epic battle between those two companies may be considered an undercard to what could be the real main event: the launch of Microsoft's Windows Vista operating system and its hunger for memory, processing speed and hardware.
