As we get into the holiday season, and see the New Year come forward with all its promise of happiness and prosperity, many of us are taking the time to reflect on what is in store for 2010? Looking back, 2009 has been a year marked with global financial crisis, job lay-offs, budget cuts, big corporate scandals. However, on the positive side 2009 has also been the year when we saw continued acceleration in startup economy and IT innovations especially in mobile technologies, clean green IT, renewable energy, health care systems, and social networking. I see some strong trends and predictions for 2010, those that I believe are worth thinking about as we look to the year ahead.

Prediction #1: Google Phone will be a game changer!

2010 will continue to see strong adoption of mobile internet and smart phones. I personally believe that mobile internet is here to dominate over the next 5 years. Google’s foray into mobile devices and OS will definitely be a game changer given its strong integration with Google services like Gmail, Picasa, maps and others. Apple iPhone, BlackBerry RIM will continue to hold onto their early mover advantages, however, Google phone will create a meaningful penetration in this ever important marketplace. There are some significant advantages that Google brings to the table, as it controls critical consumer content and applications, which will provide a very seamless integration of mobile hardware, OS and fully integrated consumer applications.

Prediction #2: Mobile Payments will become a reality

Mobile Internet is both about communication and commerce. 2010 will start to see strong adoption of mobile based commerce. Payment is a critical enabler of such transactions. Till date, mobile commerce is still in an early adopter phase. But innovative companies like Boku, Square and number of promising startups are beginning to destroy the barriers on mobile commerce. Consumers are ready for using their phones for transactions, in 2010; finally the technologies will be in place to enable mobile commerce well past the early adopters.

Prediction #3: Semantic Web is the Web 3.0

Web is rapidly evolving from being a network of pages and content to a web of “things” like people, videos, photos etc. The semantic web will become more of a reality as the social networking concept becomes a mainstream consumer activity. With astronomical growth of facebook in 2009, the social web will lead the way to creating a semantic web in 2010. Where easy linkages between entities on the web will enable new class of web applications. As an example, a group of profiles, a set of charts, and a portfolio of stocks can be mashed up to create a semantic web application for an investment club.

Prediction #4: Employee managed IT

The era of centrally managed IT infrastructure are going to be less important. Instead, you will see proliferation of devices, desktops, enterprise 2.0 applications that professionals within the enterprises will adopt at their will. The desire to standardize and control the professional environment will give way to a more user managed and user selected computing environments. Corporate professionals might use blackberries, iphones, and Google phones on the road; or many might choose to adopt Mac platforms versus the corporate mandated PC’s. We are headed towards a more heterogeneous self managed open computing environments facilitated by virtualization, cloud computing and advent of enterprise 2.0 applications like LinkedIn, yammer, basecamp and others.

Prediction #5: Acceleration of Public Privacy

Consumers are going to seek stronger privacy controls in public and social environments. Users want to be part of a social web, yet they want to feel comfortable with the privacy of their data, profile, linkages and activities. The balance of public and open life, coupled with strong privacy options will enable a whole class of new applications in health care, entertainment, professional career which we have not yet begun to see. Till date, privacy and social environments have been at odds with each other. 2010 will bring the best of both in ways that consumers will truly begin to develop their personal intelligent “agents” of the future.

Prediction #6: Smart Grids will get into action

Smart Grids are going to replace traditional utility networks, where energy consumption will get priced, as well as the demand will be dialed up or down based on real-time energy market environments. With billions of dollars of federal aid from US government, Smart grid is now on its way to becoming a reality. A number of successful startups like Silverspring Networks are taking full advantage of this macro trend and I believe we are going to see many more smart companies being launched in 2010.

Prediction #7: Vertical Consolidation in the industry

In 2010, we will see a greater shift towards vertical integration of businesses. Last decade has been all about super specializations. Moving forward, one would see more vertical integration of businesses through M&A and organic growth strategies. Oracle is busy integrating hardware from Sun to reduce the total cost of ownership of its databases and applications. This is a great example of a vertical integration. Oracle is now both hardware and a software company. Google is headed in the same direction through the launch of Google phones. Software firms might offer outsourcing services, or vice versa, IT outsourcing firms, might get into the technology business by launching their own product lines through in-house or inorganic acquisitions. Really, what will matter at the end is how one is able to provide end-to-end vertically integrated customer experience. This is a big departure from the traditional thinking of narrow niches and focused product lines.

These seven predictions are more symbolic of the direction of the technology industry and 2010 will be a pivotal year as we get out of the recession mindset to an economic growth orientation. As with all predictions, my advice to budding entrepreneurs will be to see how they can question their own strategies, and ensure that they are aligning to one or more of these macro trends. Winning entrepreneurs will have significant tail wind to propel them into success, if they can couple these strategies with strong execution.