CRN Research: IT Spending Optimism Rising In Midmarket

Within the midmarket, defined by CRN as companies with between 100 and 999 employees, the focus of this renewed spending interest, at least among the 11 Internet-related categories surveyed, is on e-commerce-related areas. These include supply chain management and online payment systems, which are seeing significantly higher levels of interest from midsize-company executives on a sequential as well as a year-over-year basis.

Supply chain management, for example, realized a 9.5 percent increase in its relative importance as a spending priority in the May survey compared with the February survey, and a 19.8 percent gain in April 2003 compared with April 2002.

CRN first observed increased business interest in e-commerce in an April 2003 survey of small-business technology executives that found that among Internet-related spending categories, the three showing the highest growth in relative importance as a spending priority on a year-over-year basis were all e-commerce-related,online payment systems, CRM and supply chain management. The size of the increase in relative importance between April 2002 and April 2003 was quite substantial.

It should also be noted that solution providers are keying in on these increased sales opportunities. In April, the e-business solutions category cracked the top 10 list of technologies that solution providers are selling, reselling or recommending to their customers for the first time since CRN began collecting that data in November. The percentage of solution providers selling, reselling or recommending e-commerce solutions has nearly doubled in recent months, to 34 percent in April from 19 percent in November.

CRN believes these trends reflect companies with existing e-commerce or Web-based infrastructure,perhaps first installed during the technology spending bubble,seeking to maximize or upgrade their investments with reality-based applications that are relatively simple and inexpensive.

Other hardware and software categories are sharing in the renewed spending interest. In this area, the focus is clearly on servers and storage, with Unix-based servers being the standout, according to CRN research data.

Compared with the February survey, the relative importance of spending for Unix-based servers jumped 11.3 percent in April, while the increase was 13.9 percent on a year-over-year basis, dwarfing the gains in any of the seven other hardware/software categories surveyed.