Business-Critical Applications Driving Wireless Initiatives

Wireless and mobile transactions will account for nearly 20 percent of business-to-business transaction volume and 25 percent of business-to-consumer traffic by 2003, according to a recent study released by META Group Inc.

“This year’s study reveals that budget expenditures for wireless initiatives still represent a low percentage of overall IT budgets,” said Jack Gold, vice president in META Group’s Web & Collaboration Strategies WCS advisory service. “Few companies are investing in wireless technologies for technology’s sake. Rather, investments are being driven by specific enterprise projects that can be enabled by wireless and pervasive computing solutions.”

The META Group study, “Wireless Adoption, Trends, and Issues”, found that business-critical applications are driving wireless initiatives. In addition, most companies are looking for extensions to existing application infrastructure, versus a “build-up” of disparate application systems.

Study results indicate that lines of business (LOBs) typically drive the demand and justification for wireless, while IT leads the implementation process. However, LOBs do exert significant influence over choices made by the IT experts.

As might be expected, organizations with heavy use of pervasive devices by employees are more aggressive in implementing leading-edge wireless/mobile infrastructure components. Several studies have found that the first priority of implementation is for business-to-employee (B2E) applications, because these applications deliver the most immediate productivity return for organizations.

Pervasive device preferences will be in great flux during the next two to three years, with no single dominant form factor. Vendors must be prepared to support many form factors, including more feature-based smart phones, PDA devices, and notebooks. Speaking of vendors, the META Group study found that users want vendors to deliver business value — not just technology. Many companies require education on the pros and cons of the technology, as well as proven vendor track records and expertise in their respective industries. Customers also expect vendors to take responsibility for ensuring their products and services work as promised in actual implementations.

“We expect the ultimate recovery of the economy to re-ignite interest in wireless technologies,” Gold said. “In the meantime, the next couple of years will be a ‘go slow’ time for most organizations, as pilots are deployed, rather than full production systems that enable a large number of users.”

The META Group report is based on a survey of 351 professionals from various organizations in North America, Europe/Middle East/Africa (EMEA) and Asia-Pacific.

The amount of spending that is projected to go into wireless initiatives is impressive given the economic environment, which has forced companies of all sizes to examine their IT spending. Mobile IT projects, however, especially those involving wireless communication, have seen only modest reductions in their budgets, according to ResearchPortal.com.

Part of the reason mobile projects continue to draw their share of the IT budget dollar is that Web projects and the Y2K bug have moved off the IT agenda. ResearchPortal found that with the Y2K bug gone, and many Web initiatives stabilized or cut, mobile IT projects remain standing. According to ResearchPortal’s data, 4 percent of mobile IT spending at small businesses was affected by budget cutbacks or project realignments in 2001. That same measure stood at 13 percent among enterprises and 10 percent among medium-sized businesses. Both medium-sized and small businesses said they expect to cut mobile IT spending in 2002, medium-sized businesses by 16 percent and small businesses by 10 percent. Enterprises expect to cut or realign 10 percent of mobile IT spending in 2002.

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