IT Spending is Down, Now What?

May 11, 2016 — Leave a comment

The Cloud is Taking Over

Spending on IT is down – the Cloud is to blame.  You can ignore it, or you can look for the opportunities in it. In every paradigm shift there is an opportunity.

If you sit around hoping it will go away, you may be out of business before long. You can complain about it, but that won’t help. You can push harder to sell more – making it up in volume somehow, but don’t count on that working either.

Gartner is telling us in May 2016, that spending is down 0.5% from this time last year…but we knew that would happen. They’ve been projecting a downturn since mid-last year.

Have you found the new opportunity? There are two things that are selling…

Cloud and Security. These two lead the charts on IT spending.

Big data comes in third. Larger companies have as much as half their computing in the cloud, and it’s growing. 80% of small business, according to Gartner will move some or all of their computing to the cloud.

Microsoft is making a big push – and we’re seeing it happen.  Oracle, Amazon, and others are doing their share as well.

As companies opt for cloud technologies, the need for upfront hardware investments is going down – along with hardware sales from your company. Meanwhile, cloud spending is growing at 22% – that’s big. If you have a cloud to sell – you may be able to capture a substantial amount of annuity business.

If you’re looking at software and license fees – expect flat growth over the coming months and beyond.

Opportunity #2 is Security

The cloud changes everything – are you investing in security services?  If you want to compete, but don’t have a big cloud offering – you can OEM.  The problem is, so can everyone. The cloud is good and bad. Suddenly everyone can offer things without spending the money.

But security is alive and growing – and it requires local expertise. Sure, you can resell a SOC offering – and you should.  But the local presence with top-tier assessments and response capabilities are worth a lot in this market. Add compliance offerings, and ongoing detection/response capabilities, and your company valuation is likely to grow quickly.

If you sell into midsize and small business – try adding 7 by 24 firewall (UTM) monitoring, mobile device security (as opposed to MDM – which is different), and SIEM technology…this gives you just about everything you need on the detection side.

Equip your team, or partner to get real time analysis of events to weed out the false positive stuff, offer routine assessments – delivered in business language and clear recommendations, and be ready to respond to relevant threats such as malware, ransomware, and anything else that might put a company out of business.

© 2016, David Stelzl

 

 

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