SMB IT Spending Will Grow, But Slowly, Say Analysts

Industry analysts IDC have predicted that SMBs will spend more money on IT this year than last but will not reach 2008 spending levels until 2011.The analyst firm's "Worldwide Small and Medium-Sized Business 20102014 Forecast: Recovery and Change in SMB IT Spending by Category and Region" predicts that worldwide, SMBs will spend $17.4 billion more this year than last. By 2014, IDC expects SMBs to be spending nearly $630 billion a year, an overall growth rate from 2010-2014 of 5.5%. Nevertheless, IT spending won't be back to 2008 levels until next year.

"The downturn had a devastating impact on SMBs worldwide," explained Ray Boggs, IDC vice president for Small/Medium Business and Home Office Research."Moving forward, small businesses will not follow the past pattern and return to pre-recessions spending levels more quickly than midsize firms. Instead, SMBs of all sizes will remain cautious with their IT spending over the next several years."

SMBs in developing regions will grow their spending faster than those in North America, Western Europe, and Japan, which account for about 70% of worldwide SMB spending on technology. Those areas will see spending growth in the 3-4% range. IDC expects spending in the Asia/Pacific and Latin America markets to grow more than 7% over the next five years, and growth in Central and Eastern Europe, Africa, and the Middle East will be higher still.

The analysts expect hardware spending -- PCs and peripherals -- to grow the fastest, with "packaged software outlays" next and systems and storage spending bringing up the rear.

The full 25-page report is available for $4,500 at the IDC site.

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