News Stay informed about the latest enterprise technology news and product updates.

Survey: SMB IT spending will reach $600B in 2015

IT spending for small and medium-sized businesses worldwide is set to reach $597 billion this year, according to Techaisle LLC, an SMB IT market research firm. In the U.S., Techaisle forecasts that SMB IT spend will reach $180 billion this year.

Techaisle also predicts that 42% of SMB employees globally will be mobile, with U.S. SMB employees taking the highest percentage of that total (53%).

techaise, smb it, it spending, 2015

U.S. SMB IT spending in 2015, Techaisle

Moreover, mobility and cloud made up about 45% of total U.S. SMB IT spending in 2014 (see chart below), according Anurag Agrawal, analyst and CEO of Techaisle, who wrote a blog post detailing the 2015 predictions.

u.s., smb it, it spending, techaisle, chart, 2014

U.S. SMB IT spending in 2014, Techaisle

These trends are a sign that SMBs (which Techaisle classifies as small and midmarket businesses that consist of one to 999 employees) have been a “growth engine” for the IT industry — they now account for more than 80% of businesses in any country, said Agrawal.

The reason for this is that in recent years, SMBs have been experiencing a “value shift” from enablement technologies — core products like PCs, servers and broadband connections — to “empowerment technologies,” or technology that allows people to be effective, like mobile and cloud.

“An argument could be made that SMBs’ desire to look beyond these technologies are simply part of the evolution of technology adoption among SMBs,” Agrawal told me in an email. However, he said the shift SMBs are experiencing is outside of the normal technology adoption curve.

Instead, Agrawal believes that SMBs are shifting because “business success is now more than ever dependent upon establishing, maintaining and optimizing relationships (with customers, partners, suppliers), along with internal cost management.”

SMBs’ technology expenditures, said Agrawal, are now increasingly made within the context of these relationships.

“This is not to suggest that SMBs should take their eye of the Capex/Opex ball,” he added.

While the obvious trend in Techaisle’s findings is the increased SMB IT spending on mobility and cloud, there were other findings of note, according to Agrawal, including the following:

  • By the end of 2015, more SMBs plan to outsource cloud migration services (40% of midmarket firms and one-third of small firms) and mobile application development and support (31% of medium-sized businesses), as well as big data and analytics projects.
  • SMB spending on shadow IT globally will reach $100 billion this year, or 17% of total IT spend; in the U.S., shadow IT spending will amount to $27 billion.
  • IT spending under lines of business in SMBs is growing substantially, forecasted to reach $99 billion in the U.S. this year — greater than Microsoft’s annual revenue.

The last trend, in particular, is a challenge for many SMBs, both on the IT and business side, said Agrawal.

About a decade ago, decision-making units — groups that made decisions around evaluating, purchasing and deploying technology — involved three to four people, all of whom were based in the IT organization. Today, IT decision-making units look much different: They’re larger and more diverse, and lines of business are a strong force. These units are now making decisions and allotting limited budgets around rapidly evolving technologies and increasing business requirements; moreover, the business decision makers in these units have different objectives and perspectives on the technology from IT, said Agrawal.

Thus, business decision makers’ increased involvement in SMB IT decisions has resulted in a “diffusion in responsibility, authority and information channels, [creating] an environment where buyers and sellers struggle to develop the cohesion needed to promote or embrace new IT/business capabilities within existing IT and business process structures,” he said.

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

SearchCompliance

SearchHealthIT

SearchCloudComputing

SearchMobileComputing

SearchDataCenter

Close