SMB Tech Spending on the Rebound, Says Microsoft

Paul Mah

In the just-released Microsoft SMB/Partner Insight Report, the Redmond-based software giant revealed how most small and mid-sized businesses are expected to increase their technology spending this year. The annual report is in its second iteration, and is based on a survey of 546 Microsoft Small Business Specialist partners that sell to SMBs, specifically in the United States, UK, Canada, Brazil and India. Reflecting the growing optimism around the globe, 63 percent of respondents predicted that their SMB customers will spend more on technology this year.


The market for SMB tech can hardly be considered insignificant. In a separate report titled, "Key Issues for IT Providers Targeting the SMB Market," James A. Browning of market research firm Gartner wrote that, "The SMB market represents 44 percent of the total IT market spending. We predict that SMBs will spend $800 billion on IT in 2010. Our research indicates that midsize businesses worldwide will increase their IT spending in 2010 by 5.4 percent over 2009 spending levels."


In a nutshell, the sheer size of the SMB market means that even a small increase can add up. It's no wonder that companies are taking note. HP has targeted its latest plug-and-print laser printers at SMBs, and network giant Cisco has unveiled a new range of entry-level network switch and VPN firewalls for the same audience.


This is clearly something that Microsoft CEO Steve Ballmer is acutely aware of, and it's summed up in Microsoft's report:

Small and midsize businesses are an important part of every economy and technology is the backbone of many SMBs. IT can help drive the efficiencies and growth that will spur SMB stability as they help lead us to economic recovery.

So what other key trends did the report find?


For one thing, SMBs are making investments focused on reducing operating costs. This might come, unfortunately, by cutting IT staff, though reductions are expected to be lower than the levels seen in 2009. Other ways of bringing operating and systems costs down would entail increased use of virtualization technologies, and using cloud computing to simultaneously drive cost reductions and support growth.


In addition, improving employee productivity seems to be a priority. On this front, one possibility would be by empowering remote workers with mobile solutions, which can reduce time wasted on unnecessary travel.


On IT Business Edge's SMB Blog, I am committed to addressing the areas that are most pertinent and relevant to small and mid-sized businesses. In fact, I already have plans to cover many of the areas mentioned in the Microsoft report, such as those on virtualization, cloud computing and ways to enhance worker productivity.


So how does your organization expect your IT spending to be this year? Do share with us in the comments section below. In the meantime, you can download the complete 2010 Microsoft SMB/Partner Insight Report here.

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