Story image

A tale of two halves as NZ SMB IT spending passes $2.1 billion mark

01 May 14

Small and medium business (SMB) spending in New Zealand grew by only 0.7% in 2013 to NZ$2.1 billion, according to a newly released report series from IDC.

In 2013, IDC saw an abrupt end to the SMB hardware spending boom, this being the main factor behind the lower than forecasted revenue.

But if hardware spending is excluded, the SMB market expanded by a more generous 3.5%.

"2013 was a tough year for providers who aimlessly targeted the SMB segment," says Louise Francis, Research Manager of IT Spending at IDC New Zealand.

"The key to success was precision engagement focused on 3rd platform technologies, particularly mobility and cloud computing.

"IDC has found most SMBs take an ad hoc approach to technology adoption, with no clear vision of how these technologies integrate with each other to provide business value.

"ITSPs and ICT advisors that are filling these gaps are the ones that have found the sweet spot in this segment."

Medium sized businesses (100-499 employees) are the star segment in New Zealand and IDC has established that this is where the biggest opportunities lie for vendors and service providers.

The following trends and traits have been identified by IDC in medium sized businesses, that highlight this opportunity;

• Medium-sized businesses are New Zealand's fastest growing IT spenders, experiencing a compound annual growth rate (CAGR) of 3.6%, through to 2017.

Key drivers of growth include outsourcing IT services and strong growth in application development software spending.

This segment has now reached a tipping point in terms of the adoption of 3rd platform technologies (cloud computing, mobility, big data and social business).

The segment's sophistication in terms of 3rd platform cloud technologies is now comparable to large enterprises.

• The biggest weakness with this rapid path to technological maturity is the chronic lack of internal IT capabilities and resources. This presents a substantial untapped opportunity for service providers to fill those gaps.

• Business drivers of IT spending change most frequently in medium sized businesses; three of the top five business concerns for medium-sized companies (market expansion, new segments, and higher profits) did not rank in the top five business concerns in 2012.

• This segment is a hotspot of growth opportunities for mobile enterprise management (MEM) solution providers over the forecasted period, with application mobilisation and mobile functionality the top ICT priority for twice as many medium-sized businesses compared with large enterprises.

Wine firm uses AR to tell its story right on the bottle
A Central Otago wine company is using augmented reality (AR) and a ‘digital first’ strategy to change the way it builds its brand and engages with customers.
DigiCert conquers Google's distrust of Symantec certs
“This could have been an extremely disruptive event to online commerce," comments DigiCert CEO John Merrill. 
Protecting organisations against internal fraud
Most companies tend to take a basic approach that focuses on numbers and compliance, without much room for grey areas or negotiation.
Telesmart to deliver Cloud Calling for Microsoft Teams
The integration will allow Telesmart’s Cloud Calling for Microsoft Teams to natively enable external voice connectivity from within Teams collaborative workflow environment.
Jade Software & Ambit take chatbots to next level of AI
“Conversation Agents present a huge opportunity to increase customer and employee engagement in a cost-effective manner."
52mil users affected by Google+’s second data breach
Google+ APIs will be shut down within the next 90 days, and the consumer platform will be disabled in April 2019 instead of August 2019 as originally planned.
GirlBoss wins 2018 YES Emerging Alumni of the Year Award
The people have spoken – GirlBoss CEO and founder Alexia Hilbertidou has been crowned this year’s Young Enterprise Scheme (YES) Emerging Alumni of the Year.
SingleSource scores R&D grant to explore digital identity over blockchain
Callaghan Innovation has awarded a $318,000 R&D grant to Auckland-based firm SingleSource, a company that applies risk scoring to digital identity.