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Majority of firms plan to upgrade old systems in 2019

A large majority of organizations (89 percent) expect their IT budgets to grow or remain flat in 2019, and many will use the increase funding to upgrade old systems and infrastructure, according to a new report from IT community platform provider Spiceworks.

Although factors driving budget increases vary significantly by company size, 64 percent of those planning to boost their technology budgets are doing so to upgrade outdated IT infrastructure, the report said.

For its annual State of IT Budgets study, Spiceworks surveyed 780 organizations in North America and Europe in July 2018. Across all company sizes, 38 percent of organizations expect IT budgets to increase in 2019, and 51 percent expect them to remain flat year over year.

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Organizations that expect to see budget increases next year anticipate a 20 percent increase on average. That’s up from 19 percent in 2018. Only 6 percent expect their IT budget to decrease in 2019, compared with 11 percent in 2018.

Larger organizations are most likely to see their budgets grow, Spiceworks said. More than half of companies with more than 5,000 employees (56 percent) expect IT budgets to grow, and 43 percent expect them to stay the same in 2019.

Large enterprises (88 percent) are more likely to boost their budgets due to increased security concerns, the report said. In contrast, IT budgets at mid-size organizations are more likely to grow because of corporate tax cuts.

“Most organizations, particularly small businesses, are increasing IT budgets in 2019 to upgrade aging IT infrastructure and support digital transformation initiatives,” said Peter Tsai, senior technology analyst at Spiceworks. “However, large enterprises, typically with more data and devices to lock down, are primarily increasing budgets due to growing security concerns. With more employees to target, larger organizations recognize the importance of boosting budgets to protect against phishing attacks and avoid potentially crippling malware.”

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