May Newsletter

INDUSTRY?NEWS

QUARTERLY INSIGHTS

Tech giants are pouring money into AI as they cut costs elsewhere.

April 28, 2023:??Alphabet, Microsoft, Amazon, and Meta reported quarterly results,?highlighting their focus on improving efficiency amidst growing economic concerns. A key investment area for these mega-cap tech companies is artificial intelligence (AI) and large language models (LLMs) like ChatGPT.

Generative AI programs, which produce human-like outputs such as text, code, or images, demand significant amounts of data, processing power, and specialized supercomputers. The tech CEOs emphasized the substantial investments required to develop and implement these AI applications during their earnings calls.

QUARTERLY INSIGHTS

IBM leans on AI, hybrid cloud as infrastructure business stalls.

April 20, 2023:?IBM's Q1 2023 financial results revealed?a modest 4.5% revenue growth, led by the software and consulting businesses. Despite a flat infrastructure revenue, the mainframe segment experienced a robust increase of over 10%. Compared to the previous year, core services such as platform, mainframe, and professional engagements showed stability, or single-digit growth. While consulting projects experienced a slowdown, CEO Arvind Krishna remains optimistic about the prospects of hybrid cloud adoption and AI for enterprise productivity driving revenues throughout 2023.

CLOUD

AI boom buoys SaaS growth as cloud market expands: Gartner.

April 19, 2023:?Gartner forecasts cloud market growth and AI software boom?- Gartner’s latest report forecasts that end-user spending on cloud services will grow by 21.7% in 2023. This percentage is higher than their October estimate, which predicted a growth rate of 20.7%. SaaS services are not the only cloud segment that Gartner forecasts to grow. IaaS leads the pack, potentially seeing a 30.9% end-user spending growth in 2023. PaaS is the second largest segment, with a 24.1% growth.?

SECURITY - AI

ChatGPT poised to expose corporate secrets, cyber firm warns.

April 18, 2023:?Companies using generative artificial intelligence could be putting confidential information at risk.?- A recent Bloomberg article reports that Israeli cybersecurity firm Team8 cautions against the high and medium risks of incorporating ChatGPT into enterprise systems, such as Bing and Microsoft O365.?

Despite the numerous benefits of these AI models, their human-like text generation capabilities could pose security risks. Models process vast amounts of data, with a high to medium risk of exposing personal information, customer data, source code, and trade secrets.

AWS - GENERATIVE AI

With Bedrock, Amazon enters the generative AI race.

April 13, 2023:?Amazon is throwing its hat into the generative AI ring.?- Amazon has entered a growing number of companies with generative AI offerings. However, Amazon's approach is to host generative AI models on AWS rather than build its own. AWS hopes to differentiate itself in the market by offering large companies the ability to build enterprise-scale AI apps.

In addition, Amazon announced its AI-powered code-generating service, CodeWhisperer, based on generative AI, which is free for developers. CodeWhisperer competes with GitHub's popular Copilot, which has over a million users thanks to the support of Microsoft's Visual Studio and Visual Studio Code.?

FINANCE??

Oracle (ORCL)-Owned Cerner Enviza signs AI contract with FDA.

April 11, 2023:?Oracle-owned Cerner announced the development of AI tools for the US Food and Drug Administration (FDA).?- These tools will extract data from electronic health records (EHR). The main goal of the work is to optimize automated queries of EHR. Another goal is an assessment of the effects and associated side effects of medicines. Cerner will focus on improving medical data collection from EHRs with NLP.?

DATA SECURITY?

Blockchain and AI combine to redefine data security.?

April 7, 2023:?Here are a few projects combining AI and blockchain for data security.?- As generative AI tools like ChatGPT have made falsifying documents, data, and files easier, businesses are turning to blockchain technology’s immutable nature as a source of truth.

VIDT DAO, LunarCrush, and Fetch.AI are three blockchain companies using a mixture of AI technology and the blockchain’s ability to timestamp to increase data validity and provide accessible tools to validate information.

DATA ENGINEERING

Zero-ETL, ChatGPT, and the future of data engineering.?

April 3, 2023:?The post-modern data stack is coming. Are we ready??- This recent article discusses the growing impact of generative AI models like ChatGPT on data engineering. The Zero ETL (Extract, Transform, Load) concept emerges as a new paradigm, reducing the need for complex data pipelines while streamlining data engineering processes.?

The potential of ChatGPT-like models to query databases in natural language eliminates the need for traditional ETL processes and enables data engineers to focus on more strategic tasks. As generative AI continues to evolve, it is expected to reshape the data engineering landscape, making it more accessible and efficient for organizations across various industries.

ARTIFICIAL INTELLIGENCE - GITHUB?

GitHub Copilot gets a new ChatGPT-like assistant to help developers write and fix code.?

March 22, 2023:?GitHub Copilot X: The AI-powered developer experience.?- GitHub has enhanced its Copilot system by integrating OpenAI's GPT-4, introducing chat and voice support within Microsoft's Visual Studio and Visual Studio Code. Expansion plans for JetBrains and Neovim are also in the pipeline.

Copilot goes beyond auto-complete and change recommendations by offering code explanations, bug fixes, and unit test writing capabilities. This AI assistance supports the entire software development lifecycle, including creating pull request tags based on code modifications.

CLOUD COST CONTROL

CIOs grapple with the fallout from rush to cloud: uncontrolled costs

March 22, 2023:?Cloud cost control.?- Enterprises find adopting cloud computing challenging to extract business benefits. To extract value from investments in cloud computing, enterprises need to reconsider their strategies related to the cloud.

During the pandemic era rush of cloud investments, developing a sound system for the cloud was not prioritized. Now is the time for businesses to revisit their cloud strategy and focus on extracting value.

ARTIFICIAL INTELLIGENCE

The case for slowing down AI.

March 20, 2023:?The AI arms race is on.?- As we enter the heat of the AI race of making anything and everything with AI, the question arises if racing to AI enablement is a good idea. AI experts are starting to worry about what they have created.

AI could join the list of things that pose a potentially catastrophic risk to humankind, such as the creation of nuclear weapons and the bioengineering of pathogens. Is it time to slow down the development of AI so that we don't create a potential doomsday machine?

MICROSOFT NEW FEATURES

Microsoft’s new Copilot will change Office documents forever.

March 17, 2023:?Microsoft's new Copilot for Office documents feels like the future.?- Copilot, an AI-powered super assistant can work across Office documents. Copilot can generate text, analyze data, and teach users new Office features. Some tricks the new assistant can do involve tasks such as setting up PivotTables in Excel, creating a graph, or helping you understand the rows and columns of data in front of you.?

Copilot works with the entire Office suite, and users interact with the assistant differently for each app. Aside from appearing as a chatbot in the sidebar, Copilot will appear when performing actions in the document, such as highlighting a text block.?

INDUSTRY ANALYSIS

Understanding the effects of mass layoffs on the tech sector.?

March 16, 2023:?CIO Deep Dive?- After the pandemic-fueled hiring binges in big tech during 2022, companies are now focusing on efficiency and realigning their hiring trends to pre-pandemic levels. This shift sees big tech firms reallocating resources and returning to headcounts larger than before the pandemic.

The job postings for specific roles like software developers are decreasing, indicating a slowdown in hiring as demand returns to pre-pandemic levels. The most in-demand roles now include DevOps, data analytics, and security, with companies looking to retain junior talent while cutting senior positions.

GOOGLE- GENERATIVE AI??

Google embeds enterprise-grade generative AI in its cloud.

March 14, 2023:?Google Cloud brings generative AI to developers.?- In the race to get generative AI to the market, Google has responded to announcements by its rivals, such as Microsoft, by including generative AI capabilities in its offerings.

For example, in its mass-market offerings, Google has added Gmail and Google Docs workspaces to include generative AI writing features, such as Smart Compose, Smart Reply, and generating summaries.?

On the enterprise side, Google's Vertex API provides API access for its cloud services to access a large language model and use AI templates for solutions to use cases based on generative AI.??

TECHNOLOGY MARKET

SVB turmoil could mean long-term uncertainty for enterprise IT.

March 13, 2023:?Uncertainty for Enterprise IT.?- According to an analyst at Forrester, the collapse of Silicon Valley Bank could disrupt the entire tech startup ecosystem.?SVB was not only a source of investment for startups but also served a valuable role in connecting smaller technology firms and large enterprises.

One of the main issues for industry leaders is the uncertainty surrounding which vendors will be affected by the bank’s demise and how the knock-on effect will affect their interests.

ANALYSIS - SOFTWARE ENGINEERS

Report: Big Transitions in the Tech Industry?

March 7, 2023:?The Hired 2023 State of Software Engineers report?reveals key trends and insights in the tech industry. The report aims to help talent professionals and software engineers understand the hiring climate and what’s top of mind for employers and engineers. It covers last year's layoffs' impact on the job market, remote pay, the most in-demand skills, the highest-paying markets, and more.

INSIGHTS

NASSCOM Technology & Leadership Forum 2023?

March 2023:?NASSCOM highlights.?- The Indian IT industry experienced a growth slowdown in FY23, with an 11.4% increase compared to 17% in FY22.?A NASSCOM survey with IT CEOs suggests that growth in FY24 could be similar to or lower than in FY23 (11.4% CC and 9.4% USD).

Furthermore, India's IT sector added 290K employees in FY23, down from 500K in FY22, as companies focused on improving utilization and supporting margins.?Although attrition rates have been on a downward trend for IT firms, they have not yet returned to pre-pandemic levels.

Engineering, Research & Development (ER&D) services outpaced IT services, growing 11.1% in FY23 compared to IT services' 8.3%. Industry experts consider generative AI an emerging trend, as it is expected to assist engineers rather than replace them. This technology can help reduce barriers to code-writing, boost productivity, and act as a deflationary force for cost optimization through automation.

INDUSTRY DATA

CIO Survey Data

The Recognize CIO Survey series is a regular panel of 250-500 CIOs in the U.S., depending on the time of year.

We use this data to track spending intentions, changes in technology, product preferences, strategic priorities, and talent challenges.

How has your organization approached ChatGPT?

Regarding the adoption of ChatGPT within organizations, our survey results show a variety of approaches. 25% of respondents are prototyping ChatGPT for enterprise use, while 28% have already deployed it in an enterprise application or process—individuals experimenting on their own account for 24% of responses.

However, 18% of organizations are not using ChatGPT at all, with 2% explicitly banning its use within their company. A small portion of respondents (3%) are unsure about their organization's approach to ChatGPT.

What is your primary cloud platform?

We also delved into the primary cloud platform preferences among organizations. AWS Amazon leads the pack with 39% of respondents, followed by Azure Microsoft at 26% and Google Cloud at 19%. Oracle Cloud and IBM have smaller shares at 8% and 7%, respectively.

Which marketing automation or account-based marketing platform does your organization use?

Regarding marketing automation or account-based marketing platform usage among organizations, our survey reveals that Salesforce Marketing Cloud dominates, with 52% of respondents utilizing it. HubSpot follows at 16%, and Oracle Eloqua captures 12%. Marketo and 6sense have lower adoption rates at 5% and 3%, respectively. 3% of participants use other marketing automation products, while 9% of respondents reported not using any marketing automation platform.

If your organization has off-shore developers, where are they primarily located?

Our survey also explored the location of off-shore software developers used by organizations. India emerged as the most common location, with 17% of respondents, followed by Western Europe and Eastern Europe at 12%. Latin America accounted for 9%, while China held 6%. The Philippines and Vietnam had lower representation at 3% and 1%, respectively. Other countries comprised 5% of responses; notably, 35% of organizations reported not using off-shore software developers.

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