SMB Spending on IT Hits Three-Year High

IT budgets within the average small and midsize business (SMB), which account for a large part of the channel, rose 19 percent in the first half of 2013, according to a new survey of 1,000 IT organizations with less than 1,000 employees. Conducted by SpiceWorks, a provider of IT management software, the survey indicates that budget allocation for new client and server hardware is particularly strong, while software spending appears to be focused more on renewals than new applications. At the same time, use of cloud services among SMB organizations continues to grow, even though they account for only 12 percent of the average IT budget at this time. In addition, the survey finds that adoption of server virtualization continues at a healthy clip. But the opportunity for service providers may soon peak, with 72 percent reporting they now use server virtualization. Reflecting an industry reality, the survey also finds that despite increased budgets, the size of the internal IT staff remains flat, which may favor the channel because it usually signals an increased willingness to rely more on external service providers.