January 4, 2013

Review by Latvian IT company DPA on the most important IT events in 2012 and industry activities and development trends for 2013

Latvia in 2012 — Review

The beginning of 2012 was marked by budget consolidation, which was started already in previous years. However, mid-2012 budget amendments allocated additional investments also for IT. At the end of the year, it was clear that companies and organizations were back on investment track for development including IT maintenance and development.

In 2012, a number of attacks on websites of state and municipality institutions indicated on potentially insufficient security level and possible issues in this area. Although in Latvia, state and municipality institutions are obliged to establish IT security management and to perform IT security audits, not always they are performed, and in many cases they are just formal. Moreover, issues identified in audits are not resolved long after their finding. This proofs the lack of resources, knowledge and understanding. With increased dependence on information technologies nowadays, organization management should pay more attention to security audits in the future and not rely only on IT departments.

So far, in Latvia, IT security issues have not affected a large number of individuals, however, such risks are growing, which is why it is necessary to take timely preventive measures.

In 2012, Microsoft in response to market and industry requirements and tendencies released new versions of several major products. One of them was Windows 8. This product was a proof to competitors that Microsoft had ambitions and power to act in the consumer goods and mobile devices market. It is anticipated that the progress and development of the above-mentioned product will introduce new trends, tendencies and app development also in the business sector.

The other Microsoft product version release is related to another global IT tendency — cloud computing. Latest versions of SystemCenter products introduced new opportunities for creating private clouds and fpr managing IT infrastructure.

For many years, cloud computing and social networks are on the list of the most important IT tendencies. In 2012, so-called free cheese phenomenon was observed also among major suppliers who, in order to gain profit from cloud computing services, limited the availability of free services. A striking example is Google that discontinued servicing its free Google Apps for Business package (including popular email product — Gmail). This means that customers in the next years will have to pay more attention to selecting partners and suppliers that would guarantee a long term mutually profitable cooperation rather than a short term benefit. In 2012, a new player was introduced in tight competition for providing office software cloud computing services to a large number of users. This player was Microsoft with its Office 365 which, as of June 2012, was available also for users in Latvia.

Likewise, during the last year global development trends of mobile, sensory and biometric technologies were reflected in Latvia. Systems were introduced so that state institutions and companies would benefit from such technologies.

Latvia in 2013 — Topicalities projection

At the end of 2012 and in the beginning of 2013, IT projects that started during the previous ERAF planning period should be finished. ERAF has funded a number of IT projects in Latvia, however more attention should be paid in 2013 to improving the usability of such systems, user training and implementation in real life to justify return on investment.

During 2013, IT industry will carry out preliminary work for the new ERAF planning period (2014–2020). When developing new approaches and planning projects, it is of great importance to take into account previous experience and learn from mistakes. A modern project management system and a profound strategic long-term planning should be in place, in order to implement projects that would not be morally improper soon after their implementation and would coincide with rapid industry changes and society requirements. Quality improvement should be discussed within this context. The systems developed should ensure a qualitative, comprehensive and professional testing so that to get the best result and financial resource optimization.

Another important question for Latvian government to discuss in relation with ERAF is a decision on a standardized unification of business processes in state institutions (web page maintenance, electronic mail systems, accounting, authentication, etc.), including a decision on implementation of a centralized state IT management system. On the one hand, state IT system integration and unification of services is a rational, economically grounded and logical decision. On the other hand, political will and power is needed to fulfill this decision and coordinate interests and needs of various departments.

In 2013, the first round of an e-Health project will be concluded; medical experts have assessed this project ambiguously. The first measures are underway, and special attention should be paid to the integration of the project with the current systems. In the next year, inter-industry cooperation for development and implementation of projects, as well as IT system integration on state and industry level will be a great challenge. When developing projects, rapid changes in technologies and industry should be taken into account.

Previously mentioned free cheese phenomenon will affect also social networks. With increasing emphasis on profits (directly from customers and indirectly from selling customer data to others) and pressure from organizations to ensure control of their information processing in such networks, social networks, especially Facebook, will face major development challenges. This, however, could clear the way for those few regional social networks that have managed to survive and preserve their own business model and audience. In Latvia, a success story of should be mentioned.

The importance of hybrid information technologies and cloud computing which, according to the IT research agency Gartner, is considered as one of the 2013 tendencies, certainly will reflect also in Latvia. Since more often exceptional server power is needed, companies and organizations will pay more attention to hybrid solutions. For daily needs internal data centers will be used, however, for exceptional situations and projects — cloud resources. Continuous investments in IT hardware will move to background, however foreground will be taken by integration solutions. Increasing number of cloud service providers and improving quality will guarantee their availability and favorability to companies in comparison with physical resource maintenance in a local infrastructure.

Another IT industry highlight in the next years will be completion of the National Library of Latvia (NLL) project. The new library will be a major information technology project that will require both software and technology solutions. Microsoft is already actively taking part in this project with its knowledge and experience. Nonetheless, the funding needed for this major project definitely will be a topic of political debates with an unpredictable outcome.

Also Riga IT Demo center, established by Latvian IT company cluster, will continue its activities while waiting for its new office at the NLL. This center helps Latvian IT industry to show its competence and innovative solutions.

In 2014, an important IT industry event will be introduction of the euro. During this year, systems should be planned and adopted to changes, in order to successfully maintain both historic data and parallel currencies (Latvian lats and euros) in the systems during the transition period as well as in the archive reports. This period will provide many opportunities and activities for accounting system manufacturers and providers.

In 2014, the Saeima elections will be held which means that an ambiguous e-Election project which currently is against the Satversme, could be a topical issue this year.

Previously widely discussed e-Signature also will move to background due to unconsidered and unsuccessful implementation. Against project developers'' arguments, it is proved in practice that e-service availability and development does not depend on e-signature availability, and currently in many cases e-signature is replaced by bank authentication solutions. For this reason DPA calls for a joint bank action to create a unified authentication center.

Increased use of smart sensors (mobile phones, TVs, vehicles, personal fitness devices, devices for measuring energy consumption, etc.) has caused a rapid growth in use of so-called Internet of Things and Big Data process technologies. These sensors are unique because of their data volume and also control options (or lack of such options). When analyzing real time volume data obtained from such devices, it is possible to provide services which previously were unthinkable and which relate to any economic sector from defense to health and education. In Latvia, the amount of available data is not that large, however, data are distributed among many institutions and organizations that is why implementation of such services will require technologies, skills and ability to look upon your own and other institutions from a different and not that convenient angle. What are the benefits? A better tax collection, lower state governance expanses, lower costs for electricity, intelligent transport planning and control, less time for commuting to work, lower costs for fuel, road maintenance planning depending on an actual intensity, etc.

In 2013, an increased use of various mobile devices in the world and in Latvia will cause also an increased IT security threat level related to use of such devices. Year 2012 proved that malware, especially for mobile devices, has increased at least ten times in comparison with the previous year. This tendency is most likely to continue also in 2013, and we expect regular leaks of confidential data from both individuals and institutions or organizations.

DPA is one of the leading ICT industry companies in Latvia with increased presence in foreign markets — in Lithuania, Belarus, Ukraine, Georgia. DPA services include IT infrastructure and security audits and solutions, business app solution development and testing, as well as licensing and software resource management services. DPA cooperates with the leading international and Latvian IT companies including Microsoft, Oracle, IBM, VMware, McAfee, Safran/Morpho, SiteCore and others. DPA is the leading Microsoft Corporation partner in Latvia.


Additional information:

Aiga Irmeja

Head of Marketing Communications

Phone: + 371 26428028