Are iPads and Androids Pushing PCs to the Enterprise Margins?

With businesses expected to buy 30 percent of tablets shipped by 2015, does the PC have a future?


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As Apple fans queue up in long lines to get their hands on the iPad 2, the contrast with the last big PC-related release – Windows 7 – couldn’t be more stark.

PCs and new operating systems just don’t create a lot of excitement anymore.

You could chalk this up as a fad, or you could argue that scarcity is driving up demand. You could even point out that the PC market is a mature one and not likely to spawn the excitement that gets triggered by novelty. All are reasonable points, but a closer look at the underlying numbers indicates that a serious computing shift is well underway.

Analysts expect Apple to ship 30 million iPads in 2011, double what it shipped in 2010. Android, meanwhile, has been taking the smartphone market by storm. The latest feather in its cap is in Europe, with Android’s market share surging from 4 percent to over 30 percent in less than a year.

Even Microsoft, which stands to lose the most in this computing shift, is banking heavily on cloud computing. As Microsoft touts Windows 7’s cloud functionality in a slew of commercial and product-placement deals, it’s also tacitly admitting that a device’s form factor will soon be far less important than the services it taps into.

How do PCs fit into the cloud computing landscape?

To put it bluntly: they don’t. Okay, that’s probably an overstatement; however, the gains in efficiency, agility and cost that organizations now seek through virtual and cloud-based infrastructures can be undermined by large deployments of PCs.

“In a typical enterprise, as much as 80 percent of IT’s budget is spent on maintenance, which makes it very hard for any IT organization to add value to the business,” said Jeff McNaught, Chief Marketing and Strategy Officer for Wyse, a provider of cloud client computing solutions.

“Even in cloud-enabled organizations, the maintenance problem does not disappear, since PCs are far more difficult to manage than servers. Data loss, intellectual property theft, viruses, targeted phishing attacks and more plague the PC, which is why end points must evolve in order to unlock the cloud’s true potential.”

Tablets and smartphones are getting all the hype, but many business users are more excited about thin or cloud clients. Unlike PCs, cloud clients can be configured so that they have little or no onboard storage or processing, virtually eliminating client-side attacks.

Moreover, since maintenance, management, patches and updates are all centralized, IT overhead is vastly reduced.

A case in point is Amerisure Mutual Insurance Company. As is common with enterprises of all sizes in all industries, Amerisure had a regular PC replacement cycle. Every three years, the company would write a $2 million check for updated equipment. The $2 million price tag was just the tip of the iceberg cost-wise, however. Productivity was disrupted with each upgrade, and, of course, management and maintenance were ongoing cost centers.

In 2009, Amerisure decided to go in a different direction. Instead of dropping $2 million on new PCs, the company ditched them in favor of a virtualized infrastructure and cloud clients.

Even though the dollar signs are eye catching, the switch wasn’t primarily about money. Rather, it was a strategic business decision. Amerisure sought an agile infrastructure that would deliver ubiquitous access to systems and data from anywhere, at any time and on any device.

The solution Amerisure chose was a Citrix XenApp infrastructure with Wyse cloud client end points. Amerisure estimates that its total savings over five years will be more than $8.5 million.

“Our virtualization implementation was critical for us to lower costs while improving service,” said Jack Wilson, Enterprise Architect at Amerisure. “Amerisure IT now runs like a utility, particularly in the way that our computing infrastructure is now part of the business fabric, like heat or electricity.”

What does the enterprise really want?

The enterprise as a whole hasn’t made up its mind. It’s growing weary of PCs, but is not ready to crown a successor.

Most enterprises are still wary of smartphones, due to IT’s inability to control and secure them. Cloud clients are catching on, offering improved security and lower IT overhead, but most of those clients are still tethered to the desktop.

Tablets represent the middle ground, delivering mobility combined with a scaled-down operating environment. Security, management and maintenance are still question marks, but the enterprise seems to be nearly as excited about tablets as consumers are, which is unusual this early in an adoption cycle.

According to a recent Frost & Sullivan report, tablets had the highest growth rate of all IT hardware sectors worldwide in 2010. Only 5 percent of the 18.3 million tablets shipped last year went to businesses, but the research firm predicts that businesses will snatch up 30 percent of those shipped by 2015.

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Tags: android apps, iPad apps, smartphone, Enterprise IT, tablets

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