Although small businesses are spending less on technology in 2001 than they did in 2000 this is not necessarily a cause for concern, according to IDC’s Small Business Technology Outlook report. The technology market researchers say that although the number of PCs being sold is declining (see Forecasts), so companies’ needs for other technology services such as internet connection, PC networking etc have increased (see Forecasts).
“Small businesses were surprisingly upbeat when we asked them their forecast of the economic climate,” said Raymond Boggs, vice president of IDC’s Small Business and Home Office Research. “They were divided between those who see rough weather ahead and those who see clear sailing. What’s important, though, is not the accuracy of the predictions, but the effect of expectations on buying behavior. To the extent that small firms believe a slowing economy will not affect their business, they will continue to represent an increasingly attractive segment for technology providers.”
Broadband providers in particular will benefit from small business spending. IDC claim that broadband connection of small businesses has risen from 11% in 1999 to almost 15% in 2000. Plans to switch to broadband have increased too, from 13% of small businesses this year compared to 7.5% who were planning to switch in 2000.
