The outlook for IT spending for cloud and managed services for 2022 looks promising, assuming organizations can acquire the hardware needed to drive application deployments.
A Spiceworks Ziff Davis (SWZD) survey of more than 1000 IT buyers in North America and Europe published this week finds that organizations’ expectations of their spending on cloud and managed services will represent 26 percent and 17 percent of overall IT spending in 2022, respectively.
By and large, 61 percent of respondents expect business revenues to increase in 2022, with only 8 percent expecting a decline. Well over half of respondents (53 percent) also said they expect IT spending to increase, while just over a third (35 percent) expect IT spending to be the same.
Shortages could create IT spending issues
The challenge, however, is the ongoing shortages will most likely result in price increases, shipping delays, and logistical issues that could adversely impact any IT strategy. Chip shortages were cited as an issue by 41 percent of respondents. Organizations may also need to rely on more external expertise than they currently anticipate. One quarter of IT professionals are looking for or planning to change jobs in 2022, the survey finds.
Hardware is projected to continue accounting for the largest share of IT spending in 2022 (30 percent) as a percentage of total IT budgets. With organizations continuing to invest in supporting remote workers, laptops are expected to be the top hardware spending area, representing 19 percent of hardware investments in 2022. Desktop and server spending now only represent 14 percent and 11 percent, respectively. Software expenditures associated with on-premises servers are also on the decline as companies continue to migrate to the cloud.
In contrast, half of all workloads are expected to run in the cloud by 2023, up from 40 percent in 2021. Nearly half of respondents (49 percent) cited multi-year modernization efforts are cited as being a top driver of budget increases in 2022.
Post pandemic SWZD forecasts a little over a quarter (26 percent) of all workers will be working remotely. Not surprisingly, spending on security is rising slightly, while the survey sees a slight decline in online backup services, largely because of increased spending that already occurred in these areas in 2021.
MSPs have benefited from need for external expertise
However, the survey also makes it clear the bulk of IT services are still being provided by internal IT teams. A total of 42 percent of respondents said they intend to increase the size of their internal IT staffs.
MSPs clearly need to make a stronger case for relying more on external IT service providers. It’s worth noting every time there is significant turnover in the internal IT staff, it creates an opportunity for an MSPs to provide an additional service.
Increased spending on IT is generally a good thing for MSPs. However, it’s clear only a sliver of the potential addressable market for MSPs is being addressed. Savvy MSPs might want to take some time now to determine how best to increase their share of the IT spending wallets that after some turbulent times are finally starting to once again fatten.
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