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UK and Ireland IT spend remains sluggish

Steve Bell

Those spending IT budgets have retained the caution of the recession with many still trying to sweat their existing technology assets and make existing investments in kit and people stretch.

Last year saw €186bn spent on IT  by businesses in the UK and Ireland according to market research carried out by ITCandor. Almost 48% of this was attributed to spend on internal IT staff and 23.8% on IT services. Eighteen percent was spent on hardware and 10.8% on software.

The survey pointed out that the business IT market has remained weak over the last 3 years in the aftermath of the credit crunch and the introduction of government austerity budgets, with reduced spending among small, medium and large organisations.

As a result, IT users have become more conservative, stretching out the life of their software, server, storage and networking equipment and looking for alternatives to capital spending.  Many have also focused on retaining highly skilled managers who are able to get the most out existing investments.

All of the respondents said they were heavily involved in advanced virtualisation with one saying the organisation no longer has physical-only servers with others saying they gone beyond just hardware partitioning to include virtual I/O and networking.  

Three out of five respondents said they were involved in using some form of cloud computing though others were still holding back from the cloud because their customers were uncomfortable putting sensitive data into the cloud.

Interestingly, despite the hype around big data analytics only two of five respondents were involved with one saying that consolidating other peoples’ databases is ‘fraught - there’s lots of talk, not much happening’.

The survey also revealed that increased virtualisation also drives up software spend as a proportion of data centre spending. Software spending for 2013 was registered at €19bn and €5bn on maintenance.  A new focus on optimising software investments in 2014 has also emerged especially as spending remains restricted.

Vendor contracts are also moving from perpetual to enablement and subscription models.


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