“With a yo ho ho and a bottle of rum I bring you…” No, wait… I mean “Yo ho ho. Merrrrrry Christmas!” Yep, it’s almost here and Santa (minus the rum, honest) has another sacklet of goodies for you. This is part three of my ‘education-speak’ version of Techmarketview‘s 2012 predictions. My comments in blue. Enjoy!
1. More SaaS vendors will lose money – Lack of consistent profitability is a telling sign that the commercial aspect of SaaS [Software as a Service] has not been mastered by SaaS pure plays. Higher prices and better cost control are one approach to addressing the problem but few will get the opportunity because acquisition activity will ramp up in 2012..
To make sense of this prediction, I think it’d be handy to understand what exactly “pure play SaaS” is. Helpfully, the September 12th 2008 Gartner report, “Market Trends: Software as a Service, Worldwide, 2007-2012,” states: “Gartner defines SaaS as software that is owned, delivered and managed remotely by one or more providers. The provider delivers an application based on a single set of common code and data definitions, which are consumed in a one-to-many model by all contracted customers anytime on a pay-for-use basis, or as a subscription based on use metrics.” Vendors that strictly adhere to this definition, and whose software is only available by SaaS, are often referred to as ‘pure plays’.
For some organisations, SaaS is the right answer. For example, if the organisation does not have sufficient capital budget to make the initial investment for an on-premise solution then a predictable monthly cost and payment out of a revenue budget might be attractive. Also, if the organisation does not have in-house technical expertise, a SaaS deployment managed remotely by the vendor might be the best option. Sound familiar? If you’re in education you’ll recognise these constraints. But what about the downside? Well, it is not necessarily cheap and it’s difficult (or impossible) to integrate with other systems. The May 29th 2009 Gartner report, “Dataquest Insight: SaaS Adoption Trends in the U.S. and U.K.” pointed out these issues with the top two barriers to purchase being high cost of services (42% of respondents) and difficulty with integration (38% of respondents).
With these points in mind, I think the SaaS vendors, and indeed the markets, are still working out where it really delivers value and 2012 will inevitably bring a distillation of vendors. As we know, education and particularly K12, suffer from the twin challenges of limited on-premise technical support and tight capital budgets. For this reason, I think there is a significant and largely untapped market in that sector. As is often the case, education is a little behind the curve in technology adoption. I would predict that through 2012 and beyond, schools in particular will begin to recognise the value in SaaS and that Management Information Systems will be a particular target.
2. Social platforms will challenge enterprise platforms – Relentless pressure from employees and customers will ensure enterprises get the social and collaboration bug despite the negative pull of rigid and hierarchical organisational structures and traditional software.
It’s hard to argue with the mind-boggling adoption metrics of Facebook and Twitter, let alone fly in the face of millions of years of evolution. Homo sapiens is a social species. Who’d have guessed, eh? OK, so it’s easy to be wise after the event, but I think social platforms are leading the charge towards the general socialisation of software rather than displacing enterprise platforms as such. That is to say, pure play social (yep, even I’m doing it now) platforms offer the full social experience (like going to a Christmas party) whereas I think we will see the evolution of social features in enterprise software (like facilitating corridor meetings). Social features such as rating, reward, reputation etc will be integrated into enterprise platforms and converge the social with productivity, leveraging the benefits that we already know and love in the physical work place. For education, the convergence will be ‘social’ and ‘learning’ and here I believe there’s massive as yet untapped potential. Young people are exceptionally good at ‘social’ and harnessing this to support learning is going to be transformational. Which makes it all the more amazing that social platforms are usually non grata in schools.
3. MEAPs will prove more ‘mobile’ than incumbents – Software suppliers will not have the mobile opportunity to themselves. They will be challenged by nimble Mobile Enterprise Application Providers (MEAPs) looking to claim a portion of the revenue software suppliers are eyeing up to help maintain growth.
Just one word: Darwinism. In a previous blog entry (Open or closed) I explored the role of natural selection in the technology ecosystem so I will not labour the points here. Suffice to say, the barriers for entry to development on mobile platforms are relatively low and so this market is wide open to massive competition. Massive competition generates rapid evolution (innovation) and so will continue to put pressure on even the big players, in some cases rendering them irrelevant because they simply take too long to bring their products to market. Small is beautiful (and mobile).
4. Big Data will move from hype to reality – Large data volumes are a fact, unstructured (and structured) data is a fact. They have to be managed and interrogated and this real need will convert hype to reality in a shorter period of time than is usual.
I’ve been listening to (thanks again Audible) ‘In The Plex’ by Steven Levy. This is the story of Googol (doh, my spelling is dreadful). And my memory… Where was I? Oh yes, so Google basically knows everything and I no longer need a memory. Well not quite everything, but you know what I mean. They know enough to be scary. One of the elements of Google I hadn’t appreciated was the centrality of Artificial Intelligence (AI) to their vision. The reason the dynamic duo of Page and Brin were so excited by large datasets is that massive amounts of data were required to enable their machines to learn meaningful things. And it’s still the case. Their view is: “If it moves, measure it.” And then they work out how to use the data. Clearly it works for them. We’re definitely in the age of ‘Big Data’ but the key will be how to convert that data into information, and that information into knowledge. Turning knowledge into wisdom may be a step too far although the idea of ‘Google Wisdom’ as our new deity is not entirely implausible.
From an education perspective, I’d say this is a largely untapped well. Culturally many education organisations find that data capture and analytics are too difficult. If you’re a parent of a child in school, you’ll certainly be aware that your child’s report is fairly one dimensional and more or less unchanged from your childhood. This is a massive missed opportunity and given that technology in schools is pretty ubiquitous, there are really exciting opportunities for capturing enormous amounts of data about learning pathways and using this data to understand what learning looks like, bringing incremental improvements in efficiency and effectiveness. I will probably blog on this specific subject in 2012, but meantime I think analytics is a significant trend to watch out for in education.
5. Security will take centre stage – End-point security and data loss prevention will be hotbeds of activity as more businesses ramp up their use of the cloud and mobile platforms. It is not just data that is at stake, but reputations that once lost are hard to win back.
Data security and eSafety are significant concerns for education organisations too. Why? Because they hold potentially sensitive information about individuals and, for minors, they have a duty of care, acting in loco parentis. For this reason, issues of identity and security will continue to grow in importance through 2012 and beyond. Of the two issues, in education I think eSafety will be the greater concern.
While it’s easy to condemn schools for trying to control the experience of their young people while using technology, schools in particular are very vulnerable to accusations of carelessness and even negligence. As a consequence they over-compensate and ban platforms that might expose their young people to bullying, manipulation, grooming and so on. It is the reason why education so often tries to create walled gardens and why the issue of identity is particularly important for schools. Arguably this may indeed be appropriate in primary schools, but by the time young people reach secondary school, and indeed beyond, we should be supporting them to understand the risks and manage their own eSafety. The alternative – banning significant portions of the Internet experience – is ineffective (because they will usually access this experience outside of the school) and counter-productive for learning (because higher order skills required in the digital world need to be taught). Once again, this is a topic all on its own and I may come back to it in 2012.