Mobile device shipments have overtaken traditional PCs within India SMBs, says AMI
Kolkata, India — January 15, 2014 — Cloud computing and mobility are the two major pillars on which India SMBs’ (small and medium businesses with 1- 999 employees) ICT adoption rests. Their combined wallet share is likely to rise from just above 30% in 2013 to almost 45% within the next five years. Specifically within the mobile devices segment, SMB tablet shipments are likely to show as high as a 50%+ growth next year. These findings have emerged from the 2014 India SMB ICT & Cloud Services Tracker Overview study by New York-based AMI-Partners.
“Mobility-related investments have emerged as key fast-growing areas in terms of ICT deployment and investments, driven by the spiraling rise in tablet and smartphone shipments as well as a significant increase in data plan spending by India SMBs. The combined tablet and smartphone shipments to SMBs have already outpaced traditional PC shipments (the latter now makes up only 45% of the hardware shipment pie). In the next five years, the share of tablets and smartphones is anticipated to escalate to 70%, as the contribution of PCs gradually drops further.
AMI’s India SMB study underscores an interesting trend: In many technology areas the share of hosted/cloud components expenditure is predicted to rise at the expense of on-premise solutions. The growing usage of hosted servers clearly illustrates this point. “Hosted servers are making significant in-roads, and hence the share of on-premise server spending is gradually on the decline,” says Dev Chakravarty, Research Manager at AMI India. “More and more SMBs prefer hosted servers and co-location since this yields multiple benefits – that is, lower costs, fewer management hassles, no need to maintain a datacenter, all-the-time 3rd party support, assured security measures, etc.” Other specific examples that highlight the drop in on-premise spending components are the rise in share of SaaS software at the expense of on-premise software and also an escalation in remote managed IT services (RMITS) components’ share vis-à-vis a drop in the on-premise service and support expenditure.
Security remains a high-priority, high-growth area within the India SMB spending portfolio. “For the major ICT spending categories among SMBs, security is a key technology that displays the highest future growth—more than 20% year on year. Within the last twelve months over 70% of India SMBs experienced some kind of security breach. Hence SMBs are now even more wary of security-related threats,” remarked Mr. Chakravarty. Clearly SMBs are emphasizing the expansion of a strong IT security infrastructure. Principal drivers of this security concern are increased adoption of cloud and mobility-related technologies, a shift towards bring your own device (BYOD), and a need to manage mobile devices. All these expose SMBs to increased security threats. In terms of future security-related trends, technologies that SMBs are planning on implementing include data loss prevention, anti-spyware, website filtering and VPN.
Virtualization is another key technology that holds significant promise within India SMBs. A segment-wise trend shows that usage of virtualization is just at an embryonic stage within the SB (firms with 1-99 employees) sector; however it is gradually emerging within MBs (firms with 100-999 employees). Both desktop and server virtualization are slowly being adopted by SMBs, thanks to the efforts of vendors and channel partners who are trying to increase awareness among their SMB clients regarding the benefits of virtualization. AMI analysis shows that server virtualization spending among India SMBs is anticipated to grow at a faster rate than desktop virtualization within the next five years. VMware, Citrix and Microsoft are key virtualization brands that have all made significant inroads within these SMBs.
On the whole, AMI’s study clearly illustrates that India SMBs are increasingly resorting to greater usage of ICT tools in a bid to generate greater business process efficiency, achieve quality excellence, overcome business challenges and gain a competitive edge over their compatriots. These SMBs show a healthy 10%+ year-on-year rise in ICT expenditures, and their adoption of technology is likely to continue escalating within the next few years. Hence, it may not be an exaggeration to identify this segment as a key growth driver of the nation’s ICT usage.
AMI’s recently published 2014 India SMB ICT & Cloud Services Tracker Overview provides marketing and product executives the insights to effectively enhance and fine tune their go-to-market approach within India SMBs for a greater bottom line impact.
The study examines India SMBs’ business needs, including ICT priorities, purchase channel preferences and buying behavior at a granular level. The analysis also delves into numerous individual ICT categories (e.g. computing hardware and networking infrastructure, software, security, storage and internet/telecommunications), encompassing both cloud and on-premise solutions. It further provides a clear sense of the overall market opportunity/outlook and the forces shaping each category. Shifts in the India SMB ICT landscape—including purchase channels—are highlighted, and the study illustrates how vendors can best leverage those shifts to deliver solutions profitably.
About Access Markets International (AMI) Partners, Inc.
AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence—with a strong focus on global small and medium businesses (SMBs), extending into large enterprises and home-based businesses. AMI-Partners’ mission is to empower clients for success with the highest quality data, business strategy perspectives and go-to-market solutions. Led by Andy Bose, the firm has built a world-class management team with deep experience cutting across IT, telecommunications and business services sectors in established and emerging markets.
AMI-Partners has helped shape the go-to-market SMB strategies of more than 150 leading IT, Internet, telecommunications and business services companies. The firm is well known for its IT and Internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.
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