3D printer at MIT Media Lab could construct a building.

New Gartner research shows that the price for “enterprise-class” 3-D printers is falling enough that more businesses can (and should) start experimenting with them. It estimates that by 2016, these big-boy 3-D printers will cost as little as $2,000. Industrial-grade printers now typically cost five times that much but there’s no reason to wait. Companies should start experimenting with the technology now, even if it’s with lower-cost desktop models, since there is minimal risk of capital or time.

In a statement, Gartner Research Director Pete Basiliere said:

“Businesses must continuously monitor advances to identify where improvements can be leveraged … We see 3D printing as a tool for empowerment, already enabling life-changing parts and products to be built in struggling countries, helping rebuild crisis-hit areas and leading to the democratization of manufacturing.”

Companies that jump in early can get a more realistic grasp of material costs and the time it takes to build parts and components, Gartner said.

To be sure, some affordable technology is already available, at least, to churn out small items. The Makerbot Replicator 2 desktop 3-D printer, which made a splash at SXSW, lists for $2,199. Makerbot is also working on a 3-D scanner to ease the measurement and digitization of what needs to be manufactured. Makerbot CEO Bre Pettis told GigaOM that the Makerbot Digitizer, due this fall, will give creators another way to move designs between the physical and digital worlds. If you want to replicate a physical item, you scan it into the system which digitizes it and builds a 3-D blueprint which can be fed into the printer.

MIT Media Lab Director Joi Ito is a huge fan of 3-D printing. At a recent event broadcast by the BBC, Ito reiterated his enthusiasm for the technology which he says can make high-quality manufacturing a key part of the U.S. economy again and boost the “maker movement” overall. As 3-D printing gains traction, more manufacturing may come back to the U.S. Ito is also investing in the sector. He, along with Google Chairman Eric Schmidt, has invested in 3-D printing startup FormLabs.

In theory, the availability of inexpensive 3-D printers means that manufacturers can afford to make small lots of goods and then quickly change up their production lines to meet new demands. This technology has spawned a new class of hardware-oriented startups and efforts. With the time-and-cost savings 3-D printing can provide, “hardware really could be the new software.”

This story was updated at 7:30 a.m. PDT with additional information on the current price of industrial 3-D printers.

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On the company’s second quarter earnings call in December, Oracle CEO Larry Ellison said Oracle’s $7.4 billion acquisition of Sun Microsystems made it “a leader in the highly profitable Engineered Systems segment of the hardware business.”  In his view, that’s a better, more lucrative place to be than in “low-margin undifferentiated products like commodity X86 servers.” Leave that race to the bottom to the Dells of the world, he seems to say. (In fact at one point during Oracle’s Sun acquisition, he actually did say that.)

Here’s the problem, since it entered the hardware business, Oracle hasn’t sold enough engineered systems to make up for lost sales of lower-end machines, according to third-party researchers. Its hardware revenue and unit share is headed south.

For the fourth calendar quarter of 2012,  Oracle server revenue  was down 18 percent year over year according to both Gartner and IDC. Meanwhile, as GigaOM’s Jordan Novet reported last week, the “other” server vendors — companies like Quanta and Wistron – saw their aggregate revenue rise nearly 22 percent in the fourth quarter compared to the year-ago period.

In units, the “other” category saw 35 percent growth. These are the types of servers that sell into huge web-scale data centers run by Facebook and Amazon. This is not a new thing: In the third quarter of 2012, Gartner numbers showed Oracle’s server revenue off 22.5 percent while “other” servers revenue was up 27 percent. Oracle’s own figures reinforce this narrative. In its third quarter, ending in November 30,  2012, Oracle hardware systems revenue fell 23 percent to $734 million from $953 million for the year-ago period.

The IDC findings are below. Obviously, Oracle sees huge potential in these high-end boxes — Nomura Securities’ analyst Rick Sherlund said “the Exaseries of servers are growing about 100 percent, but that has not been enough to offset the loss of the other business yet.” The question is how patient Oracle is prepared to be.

I’ve reached out for comment and will update this if one is forthcoming.  Update:  An Oracle spokeswoman declined to comment, citing the company’s quiet period before its next earnings report. Here’s the thing, while Oracle regroups and repositions its server business, the trajectory for “other” servers is way up and Oracle keeps heading in the other direction. It’ll be interesting to see if there’s any indication of a change on Oracle’s third quarter earnings call March 20.

This story was updated at 9:40 a.m. PDT with a statement from Oracle.

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In a new report, the big researcher estimates that the public cloud market overall will grow 18.5 percent, to $131 billion, in 2017 from $111 billion in 2012. Under this broad umbrella term for public cloud services, Gartner includes the usual suspects — Infrastructure as a Service (IaaS) a la Amazon and the growing crowd of OpenStack-based public cloud providers.

The public cloud IaaS and file and storage represents the fastest growing part of public cloud services, growing 42.4 percent in 2012 alone to $6.1 billion. With growth accelerating to 47.3 percent, it’s expected to hit $9 billion in 2013. Gartner research director Ed Anderson said that’s happening as more companies go beyond the usual development and test scenarios to more for-real production deployments — a topic we’ll doubtless touch on at GigaOM’s Structure: Data event in New York March 20-21.

Gartner also includes “cloud-based advertising services” as another hot sub-category. I assume this includes such offerings as Akamai’s new ad integration service plus, perhaps, SaaS based ad and marketing tools a la Salesforce.com. I’ve asked Gartner for some clarification on this so stay tuned. Update: Gartner defines Cloud advertising as “processes that support the selection, transaction, and delivery of advertising and ad-related data where content and price are determined at the time of end-user access, usually by an auction mechanism that matches bidders with impressions as they become available.” Relevant vendors include AOL, Apple, AppNexus, Baidu, Facebook, Google, Microsoft, OpenX and Yahoo.

The report also shows geographic differences persisting. According to Anderson:

“Although forecast growth is generally high across all regions, the adoption of cloud services varies significantly by country. Providers should not assume that a generic strategy applied to specific countries or regions of the world will produce the same outcome when applied to other countries, even countries with similar market characteristics … Local economic factors, regulatory issues, the local political climate, the diverse landscape of global and local providers, including noncloud providers, and other country-specific factors ensure a unique marketplace in each country and region.”

North America is the most enthusiastic adopter of public cloud services, with Gartner expecting it to account for 59 percent of all new spending in the overall category from now until 2016. Despite local challenges, Western Europe is projected to remain number 2, with public cloud expected to account for 24 percent of spending in the category. But, as expected, the highest growth rates will be seen in emerging markets in Asia (especially in Indonesia and India), China and Latin America.

So now comes the hard part: Remembering to come back and re-check this prediction in three or four years.

This story was updated at 5:05 a.m. PDT to include Gartner’s definition of cloud-based advertising services.

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The company started out as PHPfog, which GigaOM’s Derrick Harris characterized two years ago as a sort of Heroku for PHP developers, but changed focus to support multiple languages and multiple public clouds.

The developers using PHPFog probably already know it’s not  easy to migrate from one software version to another and when the software in question is actually the platform which runs your applications, things get really hairy. One AppFog user acknowledged that the company provided notice and guidance about migrating applications but said any such migration is fraught. “Infrastructure moves are incredibly difficult and risky and the upside is usually fairly slim,” he said via email.

We'd love to keep in touch… so please follow @AppFog as we wind down here…. It's been freaking awesome.—
PHP Fog (@phpfog) January 23, 2013

The problem of a defunct PaaS may be rare — Coghead disappeared in 2009, although SAP ended up buying the intellectual property. But given that PaaSes act as platforms for real applications, customers need to go into deployment with their eyes wide open.

Gartner distinguished analyst Yefim Natiz, who studies this topic, recommends that PaaS customers negotiate terms to mitigate risk. “You should put something in your provisions that if the company is acquired or goes away, you can get some money back — even if a company goes bankrupt there are assets left over. The best thing is to get your code in escrow so if the PaaS goes away you can run it on premises if you need to,” he said.

And of course, all companies should always back up their underlying data all the time.

Carlson, who provided the tweetstream below to show how some customers “evolved” their thinking about the transition, said the benefits of moving to AppFog outweigh the headaches of the move itself.

“They get much better service, a choice of infrastructure, new languages, five new database services and can choose whatever version control system they want to manage their code instead of being forced into Git,” he said in an interview.

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It’s easy to discount HP given its long-running troubles, but the IT giant still has lots of customers — the types of customers that make major IT decisions at the CIO level. Amazon Web Services, on the other hand, has been a lower-level developer sale, although that’s starting to change. C-level execs at big companies may not be comfortable using AWS, which after all, is a sideline business offered by an online reseller. (Sorry, AWS, but you won’t even tell us what your revenue is.)

Enterprises buy a different cloud story

“Enterprises are looking for more traditional, full-service relationship and aren’t sure about Google and Amazon,” said Dana Gardner, principal analyst at Interarbor Solutions. “HP could capitalize on that.”

The enterprise IT vendors — Dell, HP, IBM, Oracle, et al are playing catchup to Amazon in public cloud deployments. They want to move their existing hardware, software and services customers to their own clouds. And AWS is working hard to siphon those customers away with higher level enterprise-class services. That’s what I mean about more interesting.

HP claims SLA advantage in cloud

HP COO Bill Veghte (pictured) will unveil HP Cloud Compute at the HP Discover event on Wednesday. Prices start at $0.04 per hour with a service level agreement (SLA) of at least 99.95 percent — or fewer than 30 minutes downtime per month. AWS offers an SLA of 99.95 percent per year but requires very specific configurations to meet its bar for reimbursement. Gartner analyst Lydia Leong has said that Amazon’s SLAs are “narrowly defined” and don’t cover Elastic Block Storage (EBS), which most customers use.

That’s a difference HP hopes will attract customers. “HP customers want an HP cloud,” HP cloud chief Zorawar Biri Singh told me recently.

IBM says the same thing. As does Rackspace — which touts “fanatical support” as its drawing card. On the other side of the aisle, AWS is recruiting enterprise sales and support engineers from big IT companies to build sales coverage and customer rapport. Last week at AWS: Reinvent it named 15  premier consulting partners — 2^nd Watch, 8K Miles, Aquilent, Booz Allen Hamilton, Capgemini, CSS, CITYTECH, Cognizant, Datapipe, Dedalus, MarketShare, Razorfish, Smartronix, Full 360, and Wipro – to help with enterprise accounts. No one is standing still in this important battle for cloud credibility and customers.

Here’s the thing: AWS is by far the leader in cloud now, but it’s also true that we are very early in the game when it comes to enterprise cloud deployments. Anything can happen.

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The book publishing world was roiled by the recent disclosure that self-published author John Locke bought Amazon reviews and author Stephen Leather used “sock puppet” accounts to build online buzz  for his books, as GigaOM’s Laura Owen reported earlier. This kerfuffle comes after months of reports about too-good-or-bad-to-be-true restaurant and other reviews on Yelp and other online review sites.

Well, get ready, because it’s just the beginning, according to Gartner, which expects that 10 to 15 percent of all online reviews will be paid for by companies within two years. As companies seek to cash in on consumer time spent on online review sites, Facebook and Twitter, it’s not surprising that companies would try to steer consumer perception of their products.

According to a statement by Gartner senior research analyst Jenny Sussin:

With over half of the Internet’s population on social networks, organizations are scrambling for new ways to build bigger follower bases, generate more hits on videos, garner more positive reviews than their competitors and solicit ‘likes’ on their Facebook pages … Many marketers have turned to paying for positive reviews with cash, coupons and promotions including additional hits on YouTube videos in order to pique site visitors’ interests in the hope of increasing sales, customer loyalty and customer advocacy through social media ‘word of mouth’ campaigns.

Three years ago, the FTC found that companies paying for rave reviews without disclosing that the reviewer was compensated constitutes deceptive advertising and can be prosecuted. Gartner thinks that means companies will take a proactive role policing reviews that defame their products and services and pressure online sites to remove them. That will give rise to “reputation defense” companies specializing in such practices.

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Image courtesy of Flickr user ereneta

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A survey of 175 board members by Gartner and Forbes found that improving IT was rated as important as boosting sales in terms of overall priorities.

This is particularly interesting since directors are not a particularly tech-savvy bunch — only 16 percent of directors have any background in IT, according to Gartner VP and Distinguished Analyst Jorge Lopez.

The takeaway for IT professionals is that they must paint the IT investments they want to make in business terms that the board understands, for example showing how these improvements can cut costs, streamline the supply chain and/or improve the product mix. (In related news, The Technology Business Management Counsil released a publication Monday that talks up the need for CIOs to run IT as a business.)

In a statement, Gartner’s Lopez said:

Board directors clearly have a top priority to invest in IT and leverage IT for competitive advantage … These forward-looking and proactive attitudes are being made although more than half of the survey respondents replied that they are preparing for a market recession. It underlines the fact that the investments they plan to make are essential to growth and even survival, and that they are willing to throw the investment gauntlet down now, rather than later.

According to the second annual Gartner-Forbes 2012 Board of Directors Survey, a whopping 86 percent of respondents — surveyed in March and April — believe that IT’s strategic contribution to the business will increase by 2014.

Sales and IT Investment in dead heat, Gartner says

Update: The top investment priorities this year are in IT and sales, with  64 percent of respondents predicting budget increases in both areas this year, compared to last. Just over a quarter of respondents (26 percent) said they expect investment in both areas to remain the same and 10 percent said they expected budgets in those areas to decrease this year.

On a macro level, after months of reports on lax board oversight, it may be heartening that directors are at least paying lip service to being actively involved in the ongoing health of companies. Time will tell if this is a long-lasting trend or a knee-jerk reaction.

Photo courtesy of Shutterbox user hxdbzxy

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It is clear that most companies — large and small — face the bring-your-own-device dilemma whether they want to or not. Employees use the tools they like  at work.  If they use Dropbox or another cloud-based storage system with their iPhone for personal stuff, chances are they will use it at work, especially if the company’s shared storage solution is hard to use or nonexistent. The problem then becomes how to integrate those tools —  predominantly iPhones and iPads from what I can tell, but other smartphones and tablets as well — into their IT infrastructure in a way that protects corporate assets.

New Gartner research drawing on a survey of 938 businesses worldwide with 500 or more employees showed that BYOD is a primary concern among respondents, 90 percent of whom have deployed smartphones. And 86 percent said they plan to deploy media tablets later this year.

The wording in the Gartner statement is not clear on what percentage of  respondents actually have a BYOD policy in place, but it did say that “many” respondents provide support for personal devices. In fact, personal devices constituted 32 percent of smartphones, 37 percent of tablets and 44 percent of laptops supported overall. Companies in developing nations (Brazil, Russia, India and China) are more likely to support these personal devices. Nearly half (44 percent) of BRIC respondents said they support personal devices, compared to 28 percent of respondents in developed nations.

According to a statement by Gartner research director Chai-Gi Lee:

Mature countries consider BYOD programs as bringing with them both legal and technical issues, whereas emerging countries only see technical issues. For instance, mature regions are more concerned with security and data privacy regulations for immature MDM than emerging regions. In BRIC countries, employee turnover can be high in some sectors, leading to more theft of devices and data. BYOD and virtualization can reduce those enterprise losses.

What to do about BYOD

It’s a knotty problem, as any IT pro will attest. Gartner said that to allay security concerns, companies should focus on mobile data protection (MDP), network access control (NAC) and mobile device management (MDM) tools to support their BYOD and new enterprise mobile platform efforts. And it  recommends that all shops set up a mobility strategy team within IT to handle data management and control.

I think most IT shops would agree that’s a good plan but would also say the chances of it coming fruition in many companies is nill. IT pros who have commented on past GigaOM stories on this topic blasted company management for expecting support of myriad devices while cutting IT budget and staff.

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It’s easy to see why. IT staffs used to hold the keys to the kingdom — controlling what applications and data ran where and on what devices. That’s all changed — a lot — with the consumerization of IT and the advent of compute power that in-house developers can spin up on Amazon Web Services and pay for out of petty cash — without IT approval. Ditto the departmental use of easy-to-expense software-as-a-service applications. All of that erodes the power of IT folks.

Gartner, the big researcher, says it’s high time for IT to grab the bull by the horns, according to a list of 5 cloud computing trends released Monday.

For one thing,  Gartner sees a growing need for what it calls cloud services brokerages (CSBs) — a new breed of middlemen that sit between the corporate users of cloud computing services and the cloud vendors themselves.  These brokers would vet and/or approve cloud services before they get deployed.

According to Gartner:

Gartner believes that IT departments should explore how they can position themselves as CSBs to the enterprise by establishing a purchasing process that accommodates cloud adoption and encourages business unit to come to the IT organization for advice and support. The enterprise CSB approach can be implemented by modifying existing processes ad tools such as internal portals and service catalogs.

Forward-looking IT departments are already positioning themselves as facilitators of new-and-improved services to their end-user business units. (For more on this, see GigaOM Pro–subscription required.)  For IT to retain its grip, it has to be seen as a solution provider, not a department whose default position is to shoot down requested services.

Companies also need to establish “formal decision frameworks” to make the best possible cloud decisions, Gartner said.

While cloud computing’s ability to shift IT spending from capital expenditure to the more palatable operational expenditure, it should also be used to raise the lowest common denominator of IT services. IT resources should be used for “higher-value-added” activities for the business and to support innovation — not just to keep servers running and the lights on. Global systems integrators are also positioning themselves to take on this role.

IT departments are clearly on notice here. Recent Microsoft-funded research by IDC showed that the use of cloud computing will result in millions of new jobs in the next five years. That’s the good news. The bad news for IT is that whatever job growth there is will not come in IT. The automation that cloud computing provides will take on more of what traditional IT departments have done in the past so smart IT people need to get better acquainted with the services they can provide to their in-house end users, aka customers.

Photo courtesy of Flickr user Maurizio Zanetti

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