Communications and Technology Industry Research

In a new report, “2008 Medium-Size Business Server & Storage Priorities,” Enterprise Strategy Group (ESG) predicted that North American IT managers serving medium-size businesses can expect flat dollar growth in 2009 and 2010 budgets, even though there will be a rise in the requirements of data center information management.

 

The survey also depicts that the medium sized businesses will be emphasizing efficiency, cost reduction, and improved alignment along with business requirements in 2009.

 

The survey was carried out by asking IT managers who are serving organizations with workforce of 100 to 999. They were asked about organization-wide cost reduction efforts. The outcome was effort to improve IT investments in server and storage performance and utilization, as well as power, cooling, and space efficiency, which will be of top priorities.

 

According to the survey, sixteen percent of survey participants expect their IT budgets to decrease in 2009 compared to 2008; 29 percent believe budgets will stay flat; 29 percent expect budgets will increase, but at a rate of 4 percent or less; and 74 percent of medium-size organizations will have fewer dollars to work with during 2009, if the current rate of inflation in the United States is taken into account.

 

A key finding of the survey shows that many medium-size businesses’ IT decision makers are forced to make major commitments to initiatives such as server virtualization, multi-core servers, blades, and server consolidation programs. The survey statistics shows that 40 percent of organizations surveyed have already deployed x86 server virtualization and 36 percent of organizations have plans to do so.

 

One more key finding of the survey shows that medium-size businesses are experiencing a number of storage challenges, such as: 38 percent need to improve data backup and recovery processes; 33 percent organizations face increasing storage system costs; 31 percent have difficulty keeping up with data growth; and 30 percent have shortage of physical data center space.

 

Mary Johnston Turner, analyst of ESG, said: “Business requirements, budget pressures, and rapid growth in corporate data volumes are forcing medium-size organizations to take a serious look at sophisticated IT infrastructure solutions.”

 

Turner added: “Previous ESG research conducted in 2004 found that more than one-third (39 percent) of medium size organizations reported corporate storage requirements of 1 terabyte (TB) of data or less, with just 13 percent reporting more than 10 TB of data. Today, those figures have reversed: just 9 percent say they have 1 TB of data or less, while 42 percent now report having 10 TB or more. This situation is driving strong demand for a number of information management technologies, including networked storage, digital archiving, and data reduction, not to mention increased information security.”

 

According to Ms. Turner, many medium-size organizations worry of not having adequate internal skills to support the design and implementation of new technologies.

 

Turner further added: “Survey participants indicate service and support capabilities provided by vendors and/or their channel partners are now their number one IT infrastructure selection criteria, playing a greater role in the purchasing process than price or ongoing operating costs.”  

 

ESG was awarded top 10 analyst firms of the year in 2008 by the Institute of Industry Analyst Relations.