IT Budgets, Cloud Computing Services Increase, Report Finds

A report from IT management specialist Spiceworks found small to medium-size business IT professionals expect this year to be better than last, with business IT budgets up in 2010 as the economy seems to be stabilizing. However, the last six months of 2009 proved to be much harder on midmarket IT departments than IT professionals had anticipated, causing businesses to react quickly and curb IT spending.

The average IT budget climbed 9 percent in 2010 to $117,200, the report found, with 43 percent of SMBs reporting budget increases. Sixty-seven percent of SMBs said they plan to keep their IT staff the same for the first half of the year, while 20 percent said they plan to add new full-time staff. Companies with less than 20 employees report the strongest increase in hiring plans, the report said. Spiceworks surveyed more than 1,250 SMB IT professionals across the world in January and February 2010 to uncover the data.

The use of contractors and part-time resources will drop in 2010 versus 2009, and 25 percent of businesses surveyed said they plan to utilize cloud computing services over the next six months. Technology, security and performance concerns were reasons cited by those holding back on cloud investments. Virtualization continues to be popular among SMBs, with 41 percent planning new or additional investments in virtualization solutions in the first six months of 2010. Existing deployments increased workload virtualization density from 21 to 25 percent over the last six months, according to the report.

"While there were pockets of optimism, the continued economic uncertainty through the second half of 2009 resulted in many companies hitting the pause button on their intended IT plans," the report noted. "In the last 6 months of 2009, IT budgets were used for essentials only, primarily to upgrade or replace parts in hardware systems, enabling them to last just that bit longer."

The report also found on average nearly a quarter of desktops in an SMB's IT network are more than 4 years old. This is an increase of 14 percent from six months ago. The aging hardware was not just contained to desktops. The percentage of servers more than 4 years old grew by 14 percent, while laptops more than 4 years old increased a more significant 22 percent.

IT budget trends for 2010 indicated that the midmarket IT budget freeze is beginning to thaw. Forty-three percent of their IT departments reported a budget increase this year, while SMB IT professionals reported a cut to their IT budget declined 24 percent from the last survey (31 percent to 24 percent). For 2010, the annual IT budget increased 9 percent, versus a 1 percent decrease in 2009.