Key Takeaways What budgetary beasts will IT pros battle in 2016? Here are a few key findings:

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1 Key Takeaways What budgetary beasts will IT pros battle in 2016? Here are a few key findings: Despite rising average annual company revenue, IT budgets remain relatively flat. IT pros don t expect their IT staff to increase in 2016, which means they ll need to keep doing more with less. Security attacks are rising, but budgets aren't. 59% of IT pros say their companies don't invest enough in security. Technology end-of-life (EOL) is expected to strongly influence investment in /23

2 IT Budget Barriers Money makes the world go 'round, especially the world of IT. Unfortunately, IT pros and tech marketers in 2016 will have some fearsome financial foes to face. >> IT budgets remain fairly flat, even though average annual revenue is higher than last year. 2/23

3 Curse of the IT Spend IT budgets... are barely budging over the coming year. Global planned spending is expected to increase by about $2,000 year over year. And while North American IT pros will see a slight lift in their 2016 budgets, the money monsters are after EMEA IT pros they'll have virtually no budget increase next year. "A lot of the time, management's number one priority is the revenue stream. So I show them why if the issue isn't resolved, it will mean a loss of revenue in one way or another." Colton Howard, IT Manager Planned spending on IT hardware, software, and services $350,000 $300,000 $293,094 $291,062 $250,000 $200,000 $150,000 $100,000 $50,000 $0 Total /23

4 Total IT budget expected to change from 2015 to % 42% 10% 11% Increase No change Decrease Don't know Revenue Growing Though IT spending is relatively flat, more than half (56%) of IT pros surveyed expect their company's annual revenue to continue increasing in What's the disconnect? Management is laser-focused on keeping costs low, but doesn't quite get IT's importance to the company... until something breaks. Revenue change from 2015 to % 22% 10% 12% Increase No change Decrease Don't know 4/23

5 Staffing Strained Almost 60% of IT pros surveyed don't expect their IT staff to increase in 2016 (cue the Wilhelm Scream). This means they'll need to continue making IT work... minus the extra hands. Overall expected change in IT staff for % 59% 4% 3% Increase No change Decrease Don't know 5/23

6 Allocation of Budget in 2016 How will IT pros divvy up the dollars? Their top priorities are hardware and software, although spending for hosted/cloud-based and managed service projects is slated to increase slightly over Also, despite the fact that Windows 10 is a free upgrade for most, IT pros still plan to spend some money on hardware as part of their OS rollout. Overall budget allocation 37% 41% 31% 33% 13% 14% 10% 12% 5% 3% Hardware projects Software projects Managed service projects Hosted/cloudbased projects Don't know /23

7 Top hardware investments on average by year (Percentage of hardware budget) 21% 20% 19% 19% 16% 15% 10% 10% 8% 6% 6% 7% Desktops Servers Laptops Networking External storage Tablet/Mobile Surprised that desktops are still in the lead even expected to creep ahead more in 2016? Despite campfire stories of a world without desktops, they aren t going anywhere this year. Still, IT pros predict desktops will eventually be scared off by The Rise of the Mobile Empire. Top software investments on average by year (Percentage of software budget) 17% 16% 15% 15% 15% 14% 11% 10% 10% 10% 10% 9% 9% 8% Virtualization OS Productivity CRM/ERP Backup/DR Database Security /23

8 Top managed services investments on average by year (Percentage of managed services budget) 19% 16% 14% 14% 16% 13% 13% 10% 10% 9% 5% 3% 4% 5% IT services Connectivity / b Hosting Consulting Storage / backu / collabor Communication Cellular Top hosted/cloud-based investments on average by year (Percentage of hosted/cloud-based budget) 18% 16% 13% 10% 8% 7% 6% 5% 4% 4% 4% 4% 5% 6% 4% 2% Web hosting Online backup/recovery Productivity solutions Application hosting Infrastructure Hosted VoIP Sales support (CRM) Content filtering Industry specific apps Purchase Drivers 8/23

9 So what drives IT pros to buy? The numbers don't lie like last year, technology EOL and company growth/additional needs top the list. New tech features are the least compelling, with only a quarter of IT pros citing these as drivers for new tech purchases. This speaks to the motto of many companies: "If it ain't broke, don't fix it." What typically prompts your organization to purchase new hardware, software and/or services? 67% 67% 57% 56% 57% 33% 34% 25% End of life Growth / additi Upgrades / refr End user need Project need Budget availability Software / appli New technology Trending Topics Things that go bump in the server room? Security will be the stuff of techie bad dreams. On the brighter side, it s a big year for OS upgrades. >> What's keeping IT buyers up at night? Security and OSes top the list. 9/23

10 Security: Be Afraid, Be Very Afraid Only half of surveyed IT pros believe their organization's data is adequately protected and consider IT security a top priority for Almost 60% also believe their organization is not adequately investing in IT security. "It's still true that even in a high tech sector, your weakest point is your users. Ensure that all employees are being careful (hire a company full of sysadmins! :D) or TRAIN them to be better." Lisa Lyons, Network/Systems Admin Security perceptions (Percentage of those who selected agree or strongly agree) 74% 59% 62% 48% 51% Our data/it assets aren't adequately protected IT security isn't a top priority for us in 2016 We don't adequately invest in IT security We don't conduct regular security audits Newsworthy breaches haven't led us to change IT security practices 10/23

11 About three-quarters of surveyed IT pros consider their organizations at risk for technology, IT security, and man-made disasters or incidents. IT spend on security hardware, software, and services will remain flat year over year with IT professionals planning to allocate 6% of their total budget to security. Plus, many organizations aren't conducting regular security audits or updating security practices to help protect against worldwide increase in security breaches. In other words, there's still a lot of room for improvement when it comes to securing IT environments from the threats lurking in the shadows, especially as news of hacks haunt the headlines. Disaster risk perceptions (Percentage of those who selected moderate to high risk) 73% 73% 72% 40% 30% Technology disasters/incidents IT security disasters/incidents Man made disasters/incidents Natural disasters/incidents Other disasters/incidents 11/23

12 OS News: Night of the Living Dead OSes Spiceworks' exclusive network stats show that Microsoft Windows 7 is still the most adopted OS, followed by Windows XP a dead OS walking (and not a great one to have around) when it comes to security. Of the most popular OSes, Windows 8 has the lowest penetration rate. So, what's the exact OS usage breakdown we're seeing on the Spiceworks network? Percentage of companies within the Spiceworks network using the following client OSes (as of July 2014 to July 2015) 93% 90% 66% 72% 16% 18% Windows 7 Windows XP Windows Microsoft Windows Server 2003 had its end-of-service in April 2015, so it s not shocking that fewer IT pros are using it. (Though it s still present in 60% of companies.) With that, Spiceworks is seeing a higher network penetration rate for Windows Server 2012/2012 R2 than in the past as predicted. 12/23

13 Percentage of companies within the Spiceworks network using the following server OSes 60% 68% 44% 27% Windows Server 2003 Windows Server 2012/2012 R OS News: Keeping the Boogeymen at Bay According to the survey, the migration trends will continue: IT pros say their top OS initiatives for 2016 are upgrading to Windows 10 and migrating from Windows Server In addition, surveyed IT pros who've allocated budget to OS upgrades do expect to upgrade older hardware during these OS projects. What can we say? It seems IT pros are still buying hardware... even when the OS is free. "We're looking at upgrading our machines to a newer OS. While migrating to Windows 10, we're swapping out the drives on any new build/rebuild to SSDs." Charlie Tank, Network/Sys Admin 13/23

14 Top OS projects IT pros plan to spend budget on (Asked of those planning to allocate 2016 software budget to OS) Windows 10 47% Windows Server 2003 migration 32% SQL Server 2005 migration 12% Top planned hardware purchases as part of an OS project (Asked of those who know what OS projects will get budget) Servers 51% Desktops 51% Laptops 47% Storage 25% Tablets/smartphones 22% 14/23

15 Future of IT Look into our crystal ball as we delve into the popularity of different tech trends, from server virtualization to BYOD to advanced security to [insert almost anything]-as-a-service... So, what lies ahead for IT? >> EOL will be a top reason IT pros make new purchases. (So things will still go cha-ching in the night...) 15/23

16 Not-so-Terrifying IT Tech Trends More than three-quarters of survey respondents currently use server virtualization significantly more than those supporting mobility and BYOD. But only a third are using advanced solutions despite increased security attacks (consider yourself warned!) That said, IT pros are gearing up for a... threatening year. Almost a quarter plan to invest in advanced security in Other predicted areas of high growth? Application virtualization/hosted shared desktop, VDI, and various shapes of cloud such as SaaS, IaaS, and PaaS. Adoption of technology trends Server Virtualization 76% 9% Mobility/BYOD 45% 12% Advanced Security Solutions 34% 21% Software as a Service (SaaS) Application Virtualization/Hosted Shared Desktop Virtual Desktop Infrastructure (VDI) 18% 34% 28% 12% 11% 10% Infrastructure as a Service (IaaS) 11% 5% Platform as a Service (PaaS) Software defined Data Center (SDDC) Desktop as a Service (DaaS) 8% 3% 6% 4% 6% 3% Software defined Network (SDN) 6% 3% Currently use Planning to use 16/23

17 Importance of IT Initiatives to Business Security solutions, while considered pretty important to current business practices, are expected to get top billing in the future. This indicates IT pros may start using more funds to ward off potential security issues. Importance of IT solutions/services to current and future business practices (Percentage of those who selected very to extremely important) Security 73% 78% Networking 72% 70% Storage 63% 62% Software 63% 61% Hardware 59% 57% Virtualization 58% 65% Cloud based or hosted services 29% 43% Training & development 28% 39% Mobility/BYOD 18% 32% Important now Important in the future 17/23

18 IT's Not All Doom & Gloom Company revenues should get a boost in 2016, but IT budgets will remain flat. The good news for tech vendors: IT departments will still be shelling out bucks on IT in the coming year. In fact, OS migrations away from Windows Server 2003 and upgrades to Windows 10 will drive some purchases of new servers and PCs. In addition, with only half of IT departments feeling adequately protected from security threats, IT pros are definitely thinking long and hard about choosing the right security products for their organizations and budgets. For IT departments that can't spend big right now, they'll need to look for ways to spend smart by identifying clever ways to save money while still meeting business needs. In other words, things will still go cha-ching in the night /23

19 Profile Who are these IT pros making up the State of IT? Take a peek... >> From North America (NA) to Europe, the Middle East, and Africa (EMEA), these IT pros span company size, job title, and industry. 19/23

20 Number of survey respondents 41% 59% NA EMEA Top industries represented 13% 11% 10% 8% 7% 7% 5% 5% 4% Manufa IT services Healthcare Education Nonprofit Retail/wholesale Financial Services Government Construction 20/23

21 Company sizes represented 16% 20% 24% 12% 11% 8% 4% 4% 1 19 em employees employees employees employees employees 1,000 2,499 employees 2,500+ employees Top titles represented 34% 29% 12% 7% 6% Network/System Administrator IT Manager IT Director Owner/CEO/Presid Help Desk Technician 21/23

22 About Spiceworks Spiceworks is the professional network that s revolutionizing the IT economy. We provide millions of IT pros with the tools, content, and community they need to get their jobs done. Those users have attracted the attention of thousands of technology brands who use Spiceworks to reach IT professionals during their workday. Together, we ve created the world s most trusted and vibrant IT marketplace. ABOUT SPICEWORKS VOICE OF IT The Spiceworks Voice of IT market insights program publishes statistics, trends, and opinions on the IT industry. We re pioneering a new, fresh approach to IT data by combining rich social insights from the network with one-of-a-kind usage statistics on the technologies that keep businesses running today. More than 620,000 IT professionals in over 100 countries have joined the program to share information and feedback on the tech issues important to them. Follow Spiceworks on Twitter and connect with Spiceworks on Facebook. For more information visit: For other Spiceworks Voice of IT reports visit: This report contains information of fact relating to parties other than Spiceworks. Although the information has been obtained from, and is based on sources that Spiceworks believes to be reliable, Spiceworks does not guarantee the accuracy, and any such information might be incomplete or condensed. Any estimates included in this report constitute Spiceworks judgment as of the date of compilation, and are subject to change without notice. This report is for information purposes only. All responsibility for any interpretations or actions based on the information or commentary contained within this report lie solely with the recipient. All rights reserved /23

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