LONDON--(BUSINESS WIRE)--According to the latest market research study released by Technavio, the global IT spending by SMBs is expected to reach USD 850 billion by 2020, growing at a CAGR of almost 6% during the forecast period.
This research report titled ‘Global IT Spending by SMBs 2016-2020’, provides an in-depth analysis of the market in terms of revenue and emerging market trends. This market research report also includes an up to date analysis and forecast for various market segments and all geographical regions.
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The report segments the global IT spending by SMBs by IT solution and can be divided into three broad categories:
- IT services
Global SMBs IT services market
The IT services market is expected to exceed USD 382 billion by 2020, growing at a CAGR of almost 6%.
SMB spending on IT services includes IT outsourcing, system integration, hardware maintenance, and support services. The integration of on-premises infrastructure and cloud-based applications and services helps SMBs to keep business processes running smoothly and reduce expenditures.
Organizations are outsourcing their IT functions to onshore and offshore locations to achieve various objectives such as cost reductions, access to skilled workforce, cultural and language proximity, and technological advantages. According to Amit Sharma, lead research analyst at Technavio for IT spending by region and industry “Growth in the outsourcing services market is driven by a lack of in-house expertise, strategic IT planning, and a paucity of key resources. Common areas for SMB outsourcing include application development, server management, database administration, data backup, network security, and web development.”
Global SMBs hardware market
The global SMB hardware market is expected to reach USD 286 billion by 2020, growing at a CAGR of over 5%.
SMBs IT hardware budgets are directed at the procurement of network equipment, servers, storage devices, and PCs that can add value and enhance business performance. Many firms are facing issues such as end-of-life of their existing hardware products.
The need to implement secure and flexible ICT infrastructure that conforms to bring your own device (BYOD) programs and Internet of Things (IoT) technology is fueling the growth of the global hardware market. Leading networking solution providers such as Cisco, Dell, Lenovo, and HP dominate the market.
Lenovo is focusing on SMB markets through reseller partners in a bid to build its server and storage businesses. The China-based firm is currently the world leader in PC sales. It is now targeting the SMB server market in the UK and Europe, the Middle East, and Africa (EMEA). The company has developed reference platforms for virtualized infrastructure for SMBs based on EMC's VSPEX in conjunction with its channel partners, such as EMC2.
Global SMBs software market
The global SMB software market is expected to reach USD 181 billion by 2020, growing at a CAGR of over 6%.
The demand for integrated business application suites (such as customer relationship management (CRM) and enterprise resource planning (ERP), and BI suites such as Hadoop, NoSQL, and MongoDB) is rising among SMBs.
In addition, these companies are embracing software for big data and analytics for data analysis. SMBs opt for open-source software, as it is easily available and easy to install on enterprise computing systems. SMBs prefer cloud-based accounting software to reduce costs and increase flexibility in their financial management systems. SaaS accounting software is convenient for SMBs, as the initial upfront cost is low and the service provider maintains back-up and recovery features.
“The adoption of SaaS-based ERP has risen among SMBs due to affordable infrastructure costs and scalability options,” says Amit. Epicor Software, Infor, Microsoft, NetSuite, Oracle, and SAP are key vendors in the SaaS ERP market.
Technavio ICT research analysts highlight the following four vendors as the top contributors to the global IT spending by SMBs:
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