Technology Buying Slump

mgcsinc writes "According to this Yahoo article from Reuters, IT buyers are continuing a trend of cutting costs, favoring utility over cutting-edge effect. Market researchers are estimating continuing doldrums in the industry and enterprise businesses see more 'bang for the buck' from making improvements in software as opposed to investing in new infrastructure. This is not necessarily awful, however, for those who hope businesses will start looking toward open source options as the cost effective alternatives..."

Comments

News Flash

[Anonymous Coward]

The party is over. What we now consider "doldrums" are here to stay. It's the new normal. Do you ever think businesses will return to extravagant spending?

Even when the economy heats up again (let it come soon!), people will point to the late 90s dot coms as the prime example of why they should not spend money on equipment that provides no immediate ROI.

Re:News Flash

[stinky wizzleteats]

Do you ever think businesses will return to extravagant spending?

Well, I've been in the IT industry for a while now, and I certainly hope not. What made the 90's bad was not the technological advancement and optimism, it was the avarice, the exploitation of the ignorant, and the mercenarism. People bought solutions because it sounded good while bragging on the golf course, or because their absurdly overpaid consultant recommended it, or because their ridiculous sustained growth pressured sales reps forced it down their throats. People and indeed very large companies made a lot of money with no meaningful work ethic nor valuable good or service to provide the customer. There were a lot of jackass cert mercenaries job hopping in the 90's, making 6 figures a year, who soundly deserved to get their asses fired, and I for one, was grateful to see them go. (Many good people lost their jobs for no reason, however. Such is the price of the elasticism of boom and bust.) And I don't think we even need to make the obvious corporate parallel to my individual example.

I am proud that IT consumers are figuring out they don't have to pay Microsoft every two years for the honor of using their crap. I am proud that technological efforts are directed toward useful result instead of name recognition or bragging rights. I am proud that the IT megacorp and consultant establishment is being questioned, and that in house IT specialists are being listened to (they are!).

I care about what I do, and I care about my customers. I find in these times that those qualities are in very high demand. From where I am sitting, the industry has never been better.

Open source

[MrWa]

The article is about IT becoming a part of businesses that must justify new expenses in terms of ROI. This goes along with the previous mentioned articles on /. about IT being an investment.

One could make the leap to believe that this means companies will embrace free, open source! software. Maybe. Or one could look deeper and see that companies are looking to standardize - something that open source software doesn't seem to doing.

There may be places in businesses that open source software will be able to make good progress in - I hope so - but it reads like IT managers are looking to the old standards (IBM, Microsoft, SAP, etc.) for the near-term fixes that they need and any new, whizbang ideas (e.g. wi-fi) will be met with strong resistance...

Re:Gosh, utility over cutting edge

[r84x]

I don't know how you fellows make a decision, but when I go to the store to buy something, the coolness factor is always huge. For instance, buy the Cheerios that I know will satisfy my breakfast hunger, or go for the Chocolate Frosted Sugar Bombs, with the awesome toy? I will often go with the latter, even though I know better. (apologies to Calvin for stealing his cereal)

The point I am getting to here is this: Americans have always, and will always, go with the shiny new "cool" object, even when they know better. This "slump" as with all slumps, is temporary. Americans, myself included, will come back to buy the product with the bells and whistles.

Do we really need to upgrade?

[lawaetf1]

No, seriously. Gamers aside, the average home or office user can get by just fine with technology from 2+ years ago. I have a p3-800 at work as do my 30 odd users and for email, web browsing, mp3s, terminals, etc it handles the work just fine. Sure a newer system would be nice but its impossible to justify the cost when things purr along smoothly as is.
I think the same applies for servers to a lesser extent. Unless you're anticipating a heavy load chances are good the job will get done fine with a box rustled out of the closet.
Unless the fundamental ways in which we interface with the computer change then the non-power user will have longer and longer periods between upgrades.

This has always been the case

[Vandil X]

There hasn't been a single sys admin (or engineer in the pre-IT era) who didn't get financially clipped at some executive or corporate level.

It's a humbling gesture that keeps sys admins in their place and makes them come up with functional miracles with existing equipment purchases (think of Scotty from Star Trek).

Having been in the IT industry at all levels of the IT ladder, I've had to come up with my own fair share of miracles with existing equipment.

Basically, the rule is: Only buy when it's no longer cost-effective to rig something together with existing purchases.

This keeps bottom lines more realistic and prevents rogue sys admins from making their workstation into Pimp.Rig with company cash that could have been spent better elsewhere.

It's frustrating as hell, especially when no personal gain is intended, but such belt-tightening keeps companies afloat these days.

Re:This has always been the case

[ergo98]

Only buy when it's no longer cost-effective to rig something together with existing purchases... ...but such belt-tightening keeps companies afloat these days

Therein lies the crunch: Very few people actually do the math. I worked in one organization where we had 3 basically desktop systems in the field running antiquated processors: For months they had several programmers working on optimizing the code to allow it to run effectively on this underpowered hardware. The total cost to replace the hardware with machines 3x as powerful was around $6000 (and was necessary for further expansion plans), while refactoring the code came in at at least $24000. These sorts of idiotic refusals to do the cost analysis are common, and it's how many organizations spend far more by spending less.

As a sidenote, am I the only one that finds the Microsoft commercials running right now to be absolutely hilarious? In one of them you see an IT department apparently learning to dance between Windows 2003 makes life so much easier and "saves money". What they apparently fail to see is that the cost savings in manpower savings, and they're lambadaing themselves some pink slips. I'm all for efficiency, but that commercial just amazed me in the paradox of the message.

More of the Y2k effect

[ondasmom]

Much of the technology spending that happened in "the spending blow-out of the 1990s" was investment in infrastructure that IT people justified as preventing total collapse from Y2k. That stuff is just starting to wear out now, and it will be replaced gradually, rather than in another spending spree.

Re:We're going all open-source

[G-funk]

I don't know what the application is for, but Oracle -> MySQL is a step backwards

A step? Oracle -> SQL Server 2000 is a step backwards. Oracle -> MySQL is like replacing your Ti80 with an abacus.