Smaller Businesses Spend More on Mobile Services, Devices: Survey

 
 
By Nicholas Kolakowski  |  Posted 2011-01-12 Email Print this article Print
 
 
 
 
 
 
 

Smaller companies are spending more on mobile services and devices, according to a new survey, with potential to stall their IT adoption.

Given the rise of mobile devices in both the consumer and business spheres, it's perhaps no surprise that small and midsize businesses are spending an increasing amount on tablets and smartphones.

A newly completed study by the research firm SMB Group suggests that SMBs (which it defines as companies with 1 to 999 employees) invested around $26.1 billion in mobile solutions and services in 2010, a rate of spending it predicts will increase by 17 percent "for the next few years."

Of SMB's mobile budgets, voice and data services consumed 69 percent of the funds on hand, trouncing mobile applications spending at 12 percent, devices at 11 percent, and device/application management at 8 percent.

"In the U.S., mobile-service providers typically subsidize mobile-device costs as part of their two-year mobile-service contract subscriptions," SMB Group analysts Laurie McCabe and Sanjeev Aggarwal wrote in a research note accompanying the data. The result is "lower spending for mobile devices, which would cost two to three times more if they weren't subsidized."

The analysts concluded that while voice and data services currently consume the lion's share of mobile budgets, "spending for mobile applications grew about 30 [percent] faster than it did for voice and data services."

Smaller businesses with 1 to 19 employees spent the most on mobile services, solutions and devices, at least on a per-employee basis. "Average mobile spending per employee also decreases as company size increases," the analysts wrote. "As companies grow, they have more formal mobile policies that encourage mobile plan sharing, and can take advantage of volume discounts to help cut spending."

Per-employee spending on mobile-service plans apparently averages $1,056 for companies with 1 to 19 employees, nearly twice as much as at firms with 50 to 99 employees. By contrast, those smaller firms spent $150 per year per employee on mobile devices, somewhat more than the $101 spent per employee at firms with 50 to 99 workers.

Despite the opportunities that mobile devices and services offer SMBs, the high cost of service plans can threaten to stall those companies' technology roadmaps and spending on new devices. "This is particularly true in very small businesses, where 40 [percent] cite high voice and data costs as a top barrier to mobile-solution adoption," the research note added. "Even when we look at the total small- business group (1 to 99 employees), 37 [percent] say these costs are their top obstacle. As a result, today 43 [percent] of small businesses offer voice-text-only phones and plans to employees."

Recognizing that employees are increasingly mobile, a number of manufacturers have been pushing their tablets and smartphones as ideal for business use. Research In Motion, for example, is developing its 7-inch PlayBook tablet, the better to compete against the Apple iPad and Google Android tablets that have been making inroads into the enterprise and SMBs.

 
 
 
 
 
Nicholas Kolakowski is a staff editor at eWEEK, covering Microsoft and other companies in the enterprise space, as well as evolving technology such as tablet PCs. His work has appeared in The Washington Post, Playboy, WebMD, AARP the Magazine, AutoWeek, Washington City Paper, Trader Monthly, and Private Air. He lives in Brooklyn, New York.
 
 
 
 
 
 
 

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