 "SME IT Spending To Surge Indian Software Services Growth")
The Indian SMB segment with around 7.4 million businesses continues to see an increase in its IT spend. According to Nasscom this segment will be a key ingredient for sustaining future growth in the Indian software and services industry.
With increased focus by SMEs on IT adoption in the country, Nasscom recently organized a discussion on Increased IT adoption by SMB segment: A strong competitive lever, in New Delhi.
Nasscom also released ICT Adoption & Productivity in Developing Countries: New Firm Level Evidence from Brazil and India, a study in collaboration with IIM-Ahmedabad and the London Business School.
The study is based on a research from manufacturing firms in India and Brazil to explore the determinants of ICT adoption and its impact on performance in both countries.
According to a study by New York-based AMI-Partners, SMBs across the Indian subcontinent are set to spend $7.7 billion on IT this year. A third of all Indian SMBs anticipate about a 20% increase in annual revenues, and will advance their IT spending.
Out of an IT spending of $ 7.7 billion, $1.2 billion will be spend on beefing up the Internet infrastructure and solutions. Another $576 million will be spend on packaged software like productivity suites, operating systems, databases and utilities software. These four software categories will comprise close to 70 per cent of the overall packaged software spending in India in 2006.
The SMEs are opening and connecting more branches across the continent and emphasizing on the importance of networking. Storage expenditures are anticipated to grow 44 per cent based on the growing volume of data and data security.
Close to $500 million spend is expected on servers and networking hardware, with two-thirds of the spending going toward network-related hardware purchases alone.
India’s steady economic growth has boosted several sectors like auto components, textiles and garments, pharmaceuticals and banking and finance, which are on a major growth path. With most of the large enterprise market already tapped, these are the promising segments where vendors are turning to.