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Finance

Survey: IT leaders looking to squeeze vendors; Is best of breed back?

As technology budgets are squeezed IT decision makers are increasingly looking toward vendor savings to hit their targets, according to a survey by Wedbush Morgan.The securities firm surveyed 100 IT managers at companies with 500 employees or more.
Written by Larry Dignan, Contributor on

As technology budgets are squeezed IT decision makers are increasingly looking toward vendor savings to hit their targets, according to a survey by Wedbush Morgan.

The securities firm surveyed 100 IT managers at companies with 500 employees or more. Among the takeaways:

  • Thirty-five percent of IT leaders saw an "extremely challenging" year ahead and 32 percent saw budgets falling. The good news is that 41 percent saw an extremely challenging year ahead in March and 45 percent saw budgets being cut.
  • Web 2.0 takes a back seat. Wedbush found that Web 2.0 was rated a low priority by 32 percent of respondents, up from 21 percent in March. This finding echoes what Dennis Howlett noted: It's hard to get enterprise 2.0 religion about things like SaaS when you're just trying to make your existing apps work.
  • Twenty-eight percent of respondents said cloud computing was low priority for the next year (31 percent rated it a high priority).
  • Best of breed may be back. Wedbush writes:

Our survey and ongoing industry checks indicate that best-of-breed equipment vendors may be seeing incremental opportunities. Qualitative checks and recent financial results have not indicated a flight to larger vendors this recession, in fact the opposite seems to be the case with niche suppliers that have made the grade since the last downturn now sporting strong balance sheets and well tested value propositions. We believe an environment of austere stability will favor a la carte selection with lengthy decision/sales cycles and competitive pricing. Further, we think an increasing sense of stability will diminish the fear that might otherwise favor larger companies and with a gradual recovery we do not see the kind of urgency that might weigh decision in favor of incumbent convenience and familiarity.

Among the other notable charts. Maintenance is taking an increasing share of budgets.

Potential savings in the budget in the year ahead:

Priorities by category:

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