Corporations are cutting spending with legacy software vendors and plan on allocating more budget to cloud players. And that reality may mean bad news for the likes of IBM and Oracle, according to a survey from Flexera.
Overall, respondents to the Flexera survey spent 8.2% of revenue on IT. Companies with more than 10,000 employees spent 9.3% of revenue on IT. Top priorities were digital transformation, cybersecurity, customer experience and migrating to the cloud.
Flexera surveyed 303 IT executives working in large enterprises with 2,000 or more employees, headquartered in North America and Europe.
- 65% of respondents plan to increase spend with AWS and 12% plan to decrease.
- 57% plan to increase Microsoft spending with 13% planning to decrease.
- 50% plan to spend more with ServiceNow and Salesforce.
- 38% of respondents said they will increase spend with SAP and 14% plan to decrease.
- Other winners include Workday, VMware and Red Hat.
On the other side of the tech spending equation...
- 30% of respondents said they would decrease spending on Oracle with 23% increasing spend.
- 25% of respondents said they'd cut IBM spending with 20% increasing.
Flexera's survey captures the migration to the cloud and away from on-premises software. For instance, 86% of respondents expect a slight or significant increase in IaaS and PaaS with 81% expecting to spend more on SaaS. But 55% expect to decrease spending on on-premise software.
Meanwhile, that surge in cloud infrastructure spending comes as the enterprise data center footprint is shrinking. Flexera found that 65% of respondents plan to reduce data center spending as well as the number of facilities.
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