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November 1st: Torsten Jacobi, CEO of Creative Weblogging, joins host Anita Campbell. Sponsored by Six Disciplines. Show details.
Monday, May 17, 2004
SMBs To Spend More on IT
Small and midsize businesses (SMBs) will be spending on average 6.6% more on IT this year. That's according to a recent Forrester Research survey, The State of IT in the SMB Market. The 19-page report surveyed 1,002 technology decision makers at North American small and midsize business and can be purchased from Forrester for $2,999.

Ninety-five percent said they expect to replace one out of every four PCs this year. More than 68% are likely to buy their PCs direct from manufacturers with Dell leading the popularity contest. Nearly four out of every five SMBs prefer Dell PCs, although HP, IBM, and Gateway are also high on their list.

In other IT equipment areas, 74% of SMBs are expecting to buy a new server and 65% anticipate adding data storage capacity. Wireless networks are drawing SMB attention with 51% saying that they at least have a pilot program underway. SMBs are also planning to increase their Web access. Seventy percent are looking to buy added connectivity and bandwidth.

In these other areas, Dell again leads the list of preferred vendors, except in networking where Cisco is the vendor of choice for 67%. However Dell tops the list in server preference (68%) and storage (50%).

Eighty-seven percent said that they have a website with 39% of those sites hosted by outside vendors.

Four out of five SMBs plan to employ local or regional consultants, independent contractors, or VARs. E-commerce and Custom application development are the two areas most likely to require outside help.

While an increase in IT spending by SMBs is a good sign for the industry, the fact that Dell continues to enlarge its status as "the" preferred hardware provider would seem to bode ominously for other major makers. If the trend continues, they may find themselves nearly frozen out of the lucrative SMB market. On the other hand, the fact that 80% of SMBs use local or regional firms in assisting with their IT implementation, indicates a robust and competitive service provider market should continue to exist throughout North America.
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