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By Nick Wakeman

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Nick Wakeman

Nick's picks: 6 questions everyone wants answers to

In my job, I often get asked about trends in the market. Most of the time people want me to have an answer, but in today’s environment it is often a guessing game.

Here is a breakdown of the four most common questions that I’ve been getting lately, and my stab at answering them.

1. What do you see the government spending money on?

Savings and efficiency are the big watch words. Executives are telling me – sometimes with enthusiasm, sometimes with pained looks – that government customers want to know specifically how products or services can save them money. And it needs to be with dollar signs attached.

That’s been the lure of cloud computing, though some of those dollar signs are squishy. Perhaps the bigger play for cloud is a shift of responsibility for keeping the infrastructure running to the contractor, not the government. Even if cloud computing costs the same, that shift of risk and responsibility seems to be a major plus for agencies.

Big data also gets a big push on the efficiency side. Agencies want to make better decisions, and that’s the power of analytics.

2. What will sequestration’s impact be?

That’s a question that I struggle to answer. The ultimate impact is still unknown. The amount of the cuts appears to be locked in, but the continuing resolutions that are being debated should give at least the Defense Department and perhaps several civilian agencies more flexibility in how the cuts are implemented.

I think, for the most part, we will have a year full of uncertainty, even if a CR is passed.

3. Where are companies spending their money?

Cyber, cloud computing, health care, big data, energy management – all of these are the hot market segments that will have healthier than average budget support.

These are the areas where I think the merger and acquisition activity and internal investments will be focused.

But the overall strategy of buying companies for domain expert, customer sets, technology and contracts remains unchanged from the past several years.

Companies aren’t buying bulk or size. While they want growth, they also want high margins.

these days, profit trumps revenue.

4. What’s the biggest market change you've seen at Washington Technology?

This is a question from a radio host whose program I’m going to be on next week (I’ll send out more details when they are available). What I like about this question is that it gives me a chance to be a geezer: "Why, let me tell you, young fella, I remember the days ..."

Seriously, the biggest change since 1996 to today has been the shift from a market dominated by hardware and software to one dominated by services and solutions. At one time, EDS, Unisys, Northrop Grumman and other companies had reseller businesses. It was the client-server era. The answer to every computing problem was more servers, more PCs, more, more, more.

Today with cloud computing, mobile computing and virtualization it is about less, less, less.

5. What the next big thing?

I think with mobile computing and the fact that, like it or not, we are all walking sensors, machine learning is the next big thing.

Computers are getting smarter and smarter, and will be anticipating our needs, instead of us always having to tell it what we need.

I can see serious applications in areas of health and transportation. I think there will be relatively frivolous things, like your car talking to your house to turn up the heat when you are 15 minutes away.

6. What do you think of company X?

I like this question a lot. So many companies are doing such interesting things these days.

Whether it is Science Applications International Corp. splitting into two, or CACI International’s new CEO, it’s an exciting time to cover the market.

Sometimes I know what these things mean, sometimes I don’t, but it is always fun to have an opinion.

Posted by Nick Wakeman on Mar 11, 2013 at 9:49 AM

Reader Comments

Wed, Mar 13, 2013 Don O'Neill

On austerity and sequestration, just what are the top ten challenges for defense contractors today? The Department of Defense depends on the defense industrial base to delver on the competitiveness, security, and innovation challenges facing the nation. Always difficult, the situation is now dire as these challenges loom insurmountable due to austerity and the threats and effects of sequestration. Each of these challenges is highlighted in this YouTube presentation. Austerity and Sequestration Challenges http://youtu.be/opucWInEY2E 14:33

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