Planning for the best in a consolidating market

2008 will be an interesting year for vendors and customers. There are opportunities in the challenges ahead
Written by Leader , Contributor

The "C word" is back in town.

In the mobile industry, networks are sharing masts and closing down duplicate base stations. In consumer-land, HD DVD backers have moved to Blu-ray with indecent haste. And, down on the server farm, virtualisation looks not so much like a smart way to improve efficiency as indispensable, the only way to keep the cap on cap ex. Even if you ignore the Microsoft-Yahoo-ha, the rumours about Motorola, and the reported 230 enterprise application deals in 2007, consolidation is this year's theme.

This change in the commercial landscape promises both danger and opportunity for the IT planner. The dangers are in the increased chance that suppliers will vanish into the maw of their competitors, with roadmaps rolled up and plans abandoned. That's something which may seem beyond the control of customers; it's certainly not desirable. But you can do something about it: consider change-of-ownership clauses in contracts for mission-critical deals, designed specifically to safeguard your interests.

The opportunities come in why and how consolidation happens. Companies are acquired for their customer base, and that base is most desirable if it is easy to plug into the buyer's existing products and services. More than ever, adopting good design and engineering practices is a sovereign investment for avoiding unhappy events to come; open architectures and multiple suppliers leave much more room to adapt plans and reduce dependence on any one particular vendor.

And there are bolder steps you can take. The best defence against vendor consolidation is to dispense with vendors altogether. With trends towards building more technology in-house from open-source components and creating development consortia with others in your industry, there's never been a better time to regain control of key IT. That doesn't necessarily mean an end to outsourcing or buying in managed services, but rather a keener eye for cost control and the benefits of maintaining flexibility through skill rather than spend.

It is ironic that economic downturns so often involve more work, seemingly just to stay in one place. But it is foolishness not to use the chance to make that work count for more: a company that can adapt well to trickier environments is going to be well positioned to power ahead when things change for the better.

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