June 2, 2011 – Small to midsized business IT spending has outpaced expected growth since 2009, when SMB IT spending declined by 4.2 percent, says a new IDC report.

The nearly 8 million U.S. SMBs will spend more than $125 billion on advanced technology in 2011 in the IDC 2011-15 forecast, an increase from $120 billion spent in 2010. These two years of spending growth represent a substantial rebound from 2009.

According to the research, SMBs are responding to today's economy and adapting differently than large enterprises, in many cases. Although the small business segment (fewer than 100 employees) has traditionally shown higher IT spending growth, that pattern broke during the past two years as smaller firms were more adversely affected by the economic downturn. That noted, the small, lower midsize (100 to 499 employees), and upper midsize (500 to 999 employees) segments will each continue to make a significant contribution to total SMB spending, though upper midsize firms will have the highest rate of spending growth in 2011, according to the report.

The number of SMBs with local area networks will exceed 4.5 million in 2015. The declining price of entry-level hardware will drive server acquisition in small firms as virtualization solutions motivate midsize firms to upgrade and consolidate their environments, says IDC.

"Technology disruption can be your friend," said Justin Jaffe, senior research analyst for Small/Medium-Sized Business and Home Office research at IDC. "Innovative firms that are open to new approaches will have a competitive advantage in the years ahead. Products and services that support the key SMB priorities of mobility and connectivity – such as networking and mobile computing – will have the strongest appeal."

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