One in five businesses will ditch their IT as cloud takes hold

And as CFOs take charge of the IT budget, expect them to cut the capex...
Written by Tim Ferguson, Contributor

And as CFOs take charge of the IT budget, expect them to cut the capex...

Businesses will increasingly move away from owning their own IT assets, analysts have claimed.

According to Gartner, by 2012, 20 per cent of businesses won't own any of their IT assets, including servers, PCs and software, as turning to leasing, employee ownership schemes and cloud computing instead.

The change is largely related to businesses preferring to fund their IT through operational expenditure rather than capital expenditure.

Gartner VP and research fellow, Brian Gammage, told silicon.com: "In a time of liquidity squeeze, you're possibly happy to pay a little bit more on the opex if you can avoid that big capex."

Leasing equipment from specialist companies will be another increasingly popular way for businesses to help ease the burden on capex.

Computers in office

(Photo credit: Shutterstock)

"Anything that puts you into contract where you can avoid the lump sum expenditure and amortise the payments over a longer period of time is something that appeals," Gammage said.

The growing number of CFOs taking overall control of the IT department will also play its part in encouraging enterprises to do away with their own hardware and software estates.

"The finance and CFO-type function, having acquired the requisite understanding to be able to make decisions about IT, I don't think that control is going to come back."

"They will look at this in a much more [profit and loss], balance sheet-type way and that is absolutely a driver" in companies no longer having their own assets, Gammage added.

Businesses are also likely to cede ownership of their assets thanks to developments in technology: with the greater availability of hosting and cloud computing, businesses can pay to use software, processing power and storage without having to buy, install and maintain servers in their own office.

In addition, Gammage said that more enterprises may avoid shelling out on computers by asking employees to use their own PCs or laptops, although if businesses want to take this route, they'll have to pay their employees more so they can justify asking them to buy their own work computers.

Gammage added that many organisations who are subject to stricter security and compliance restrictions - such as finance and manufacturing businesses - will be much less willing to give up control of their hardware, however.

The move away from companies owning their own hardware and software will likely lead to internal IT departments shrinking, with fewer tech workers are needed to maintain infrastructure. "It's a hard fact that if you don't have as much stuff, you don't need as many people to maintain and support the stuff. One of the things you're trying to get out of is that responsibility," Gammage said.

However, Gartner said that the trend could lead to workers being trained in new skills rather than being made redundant.

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