Sometimes one does ask oneself some stark questions about the state of the IT industry. Does the rise of Ch-India mean primary software development is set to leave the West? Is the Silicon Valley ‘motor’ that drove that amazing cycle of start-ups, IPOs and yet more fresh talent coming into get their share of the stock options, really gone for good? Is ‘the cloud’ the neutron bomb that will finally kill off the internal IT function in any but the larger class of organisation?
Sometimes I try and collapse all these dark thoughts into a question I like to ask IT leaders, both of vendors and end-user companies: would you encourage your children to enter the IT marketplace?
I think I have fresh reason to pose this question following UK technology market watcher Richard Holway’s latest prognostications on the current and future state of the industry. Bottom line: media is now a bigger prospect for high growth as an industry sector than IT – a change the veteran analyst has cutely summed up as a state of cold tech.
Holway has this week reminded us that the UK IT sector’s market growth in the decade just closed had been below the national growth rate in GDP growth. That’s down to the inexorable rise in outsourcing and off-shoring and the sale of the few domestic IT outfits to overseas companies. Now some 20% of the revenue and 40% of the people employed in the sector work for non-UK-headquartered operations.
As a result, the media sector will soon displace IT as a bigger component of the way UK Plc earns a shilling, a trend Holway sees as signalled by our relative excellence in the computer games sector and all that black polo neck computer graphics work going on in Soho.
Nothing the co-founder of TechMarketView is saying here is that new to those of us who have been around for a while. But it’s still quite discouraging: I am no Little Englander and if you start talking about Alvey, the Transputer or even Gawd help us Acorn, expect the line to go dead pretty quickly.
But at a time when our economy faces the biggest challenge since the Great Depression – the cosy sinecure of public sector employment seems to be a thing of the past and we seem to have bailed on the idea of The City as being all we need to pay our way in the world – an economy with little IT employment is hardly the basis for celebration.
The genie can’t be put back in the bottle – we all know that. But some serious debate about how we can maintain a vibrant technology sector is much needed. One suspects the time to have it is not as we gaily plunge into an era of austerity and cuts, but then again, it may be our last chance.
