Where Will SMBs Spend Tech Dollars in 2008?

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Most industry observers don't expect SMBs to slash their technology budgets as dramatically as their larger counterparts as the economy slows, as I blogged back in February.


So where will SMBs spend their dollars?


Based on a survey of some 1,000 North American IT managers conducted by Forrester Research in late 2007, must-have capabilities like security and disaster recovery will get some of the biggest budget allocations. According to ChannelWeb, 48 percent of respondents identified improving disaster recovery as either a "high" or "critical" priority for 2008. That's a 4 percent increase over the previous year. Similarly, 46 percent mentioned upgrading their security environment as either a "high" or "critical" priority, up 6 percent from 2006's survey.


There's plenty of room for growth in SMB security spending. As IT Business Edge blogger Carl Weinschenk wrote in December, according to an eMediaUSA survey of SMBs, 45 percent of respondents devote less than 1o percent of their IT budgets to security. Thirty-eight percent of them spend between 11 percent and 30 percent. Interestingly, 77 percent of the respondents felt their allocations were adequate.


Many of the same areas identified in the Forrester research were also mentioned by SMBs surveyed by the Computing Technology Industry Association (CompTIA) in late 2007. Among them: data backup, storage and disaster recovery, mentioned by 29 percent of respondents; server virtualization and consolidation (19 percent); and storage area networks (13 percent).


SMBs' desire to consolidate their systems is behind the increased interest in virtualization, says Forrester analyst Michael Speyer. He predicts this interest will move beyond servers and storage systems to the desktop, a trend I blogged about last April.


Which areas of the budget will SMBs be inclined to cut if necessary? PCs, printers and other discretionary hardware are among the most likely purchases to be eliminated, Speyer says.