Breaking Analysis with Dave Vellante

As we watch an historic election unfold before our eyes, we look back at the early days of this millennium and the memorable presidential race of 2000. That decade was defined by 9/11, which permanently re-shaped our thinking. We exited the ’00s at the tail end of a massive financial crisis only to enter the 2010’s with hope, and the momentum of fiscal stimulus, a flat globe, job growth and very importantly, the ascendency of the cloud. Cloud computing, unquestionably powered the innovation engine over the last ten years and the pandemic marks a new era, where adoption of cloud, data and AI have been accelerated by two to three years.. These trends will shape the future of the technology industry and all businesses.

Azure Cloud is the linchpin of Microsoft’s go forward innovation strategy. Big tech came under fire again this week but Microsoft CEO Satya Nadella was not one of those CEOs getting grilled. Unlike Google, Microsoft does not heavily rely on ad revenues. Rather the company’s momentum is steadily building around Azure Cloud which by my estimates is now ~19% of Microsoft’s overall revenues.

The cookie apocalypse is coming. Massive changes in public policy threaten Google's traditional business. The company's response to the DoJ’s antitrust suit should be to double or triple its focus on cloud and edge computing – a multi-trillion dollar opportunity.

As we reported in our last update, tech spending overall continues to be significantly muted relative to 2019. We currently project a 4% to 5% decline in 2020 spending and a tepid 2% increase in 2021. Nonetheless, there are some sector and vendor bright spots in an overall challenging market.

In the most recent September ETR spending survey, CIOs expect a slight sequential improvement in Q4 spending relative to Q3– but still down 4% from Q4 2019. So the picture is still not pretty but not bleak either. Firms are adjusting to the “new abnormal” and are taking positive actions that can be described as a slow thawing of the deep freeze.In this Breaking Analysis we will review fresh survey data from ETR and provide our outlook for both Q4 of 2020 into 2021.We are still holding at our 4-5 percent decline in tech spending for 2020. But we see light at the end of the tunnel – with cautions.

Breaking Analysis: Application Performance Management…From Tribal Knowledge to Digital DashboardFor years, application performance monitoring/management (APM) has relied on alerts, logs, traces and even tribal knowledge. In the pre-distributed systems world, this was fine. But things got much more complicated architecturally with cloud and are changing so fast with containers and serverless. Today, it’s much harder to understand the customer experience because it’s difficult to get a full picture of all the data.Read the full research report:https://bit.ly/2FWfN22

Now that Snowflake's IPO has hit, we're getting inundated with inbounds & questions. What have we learned? Is the stock over valued? Can Snowflake grow into its valuation? Should I buy? When should I buy? Can Snowflake compete with the big cloud vendors? In this segment we try to answer these & other questions with opinions backed by data from our friends at Enterprise Technology Research.

Stock market recoil pulls the rug out from many tech investors. Leaving them wondering what’s next? The steepest drop in the stock market since June 11th flipped the narrative and sent investors scrambling. Tech got hammered after a 2-month run and people are asking questions. Is this a bubble popping or a healthy correction? Are we now going to see a rotation into traditional stocks like banks and certain cyclicals that have lagged behind the technology winners?In this week’s Breaking Analysis we want to give you our perspective on what’s happening in the technology space and unpack what this sentiment flips means for the balance of 2020 and beyond. As always we’ll reference survey and model data from ETR to support our opinions. 

Enterprise software markets are dominated by mega cap companies like SAP, Oracle, Salesforce and Microsoft. SaaS leaders like ServiceNow and Workday have solidified their market positions by, to a great extent, replicating the Salesforce model in their respective domains. There is still room for innovative upstarts that are introducing new cloud native services and value pricing models but the traditional space is maturing with possible disruption coming from cloud developers and ecosystems.

Cloud, IAM & Endpoint Security are rocking the markets.Over the past 150 days, everyone in the technology industry has become an expert on COVID in some way shape or form. We have all lived the reality that COVID-19 has accelerated by at least 2 years, many trends that were in motion well before the virus hit. The cyber security sector is no exception and one of the best examples where we have witnessed accelerated change.