APAC SMBs to increase IT spend in 2009

Region's small and midsize businesses are expected to spend US$153 billion on IT and telecom in 2009, or US$6.5 billion more than last year, says new report.
Written by Vivian Yeo, Contributor

Despite challenging economic times, IT and telecom (IT&T) expenditure by small and midsize businesses (SMBs) in the Asia-Pacific region will reach US$153 billion in 2009, according to a new report.

This year's projected SMB spend is an increase of US$6.5 billion over last year, Access Markets International Partners (AMI-Partners) said in a statement Thursday. The SMB research specialist defines SMBs as companies that have fewer than 1,000 employees.

Leading IT&T spend in the region are China, Korea and India, the report noted. SMBs in China are expected to constitute close to 30 percent of the total Asia-Pacific spend this year, while Korean enterprises are likely to contribute about 20 percent.

Indian SMBs are the fastest growing pool, with a forecast 8.5 percent growth in IT&T spending over last year--nearly double that of the average 4.5 percent growth for the region, said AMI-Partners. SMBs across all industries in India, however, are expected to lower their spending growth rates by 1 percent to 2 percent this year, it noted.

Contraction of about 2 percent will take place in the Australian and New Zealand SMB IT&T markets, Vu-Thanh Nguyen, research analyst at AMI-Partners, reported in the statement. However, this is expected to be offset by the three key performers as well as other growing markets such as Indonesia and Malaysia, he added.

Singapore-based Nguyen attributed the region's uptrend in IT spend to telecom services and computing becoming as integral to SMBs as water and power is to households. "Despite the economic downturn, SMBs will still have to spend on basic needs like printing.

"They also need to continue upgrading and replacing old PCs, and buying new systems such as tablet PCs to maintain [if not] increase employee productivity. Ultimately, such investments are seen to help SMBs reduce costs and enhance their competitiveness," he explained.

Similarly, smaller companies will spend on telecom services to increase business opportunities, collaboration and time efficiency, and at the same time reduce expenses, said Nguyen.

"In this crisis, there will be a heightened need to communicate and maintain good relationships with existing customers, partners and employees, as well as to attract new customers," he pointed out. "Therefore, we expect to see similar, if not higher, spending on telecom services and computing compared with last year."

According to AMI-Partners, the region's SMBs will dedicate about 60 percent of their IT&T expenditure on telecom services and computing requirements, which includes printers and printing supplies, as well as PCs and servers.

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