Tech Market Reaching Bottom, but Content is Leading the Growth
ZDNet reports on recent research that indicates the tech sector has bottomed out at last, and that it can "enjoy" strong single-digit growth over the next couple of years, even as half of the existing tech vendors are expected to disappear, presumably through acquisition or attrition. The era of business plans based on corporations buying an endless stream of $250,000 ROI-enhancing software tools is certainly gone, due in large part to instituions purchasing these tools becoming not only more cost-sensitive but also more aware that it doesn't take huge amounts of IT investment to be a reasonably effective publisher of content, thanks to standards and increasingly open computing options. At the same time to become a very effective institutional publisher requires far more infrastructure integration from storage to Web interface than ever before, leaving purveyors of piecemeal solutions struggling for a place at the table. The tech industry has been coasting for several years on largely modest incremental improvements to fundamental technology, while the content industry has been shaken from top to bottom with radical changes that have required much fundamental restructuring. With firms like Thomson reporting more than 20 percent gains in common stock earnings over last year, expect the winners over the next two years to be those companies which know best how to marry content, technology and human requirements - while pure tech companies go back to the drawing boards to define true technology breakthroughs.