India Small Biz: Big IT Spenders

Small and midsize businesses in India will increase their storage tech investments by 35% this year, to $480 million, according to a new study

In its latest report released Wednesday, the research house said that spending on storage products and services is set to reach US$480 million this year, of which India's small businesses--defined as having fewer than 100 employees--will account for the lion's share of the investment.

Over 50 percent of the overall storage expenditure will be fuelled by small businesses in the country, and this number is set to increase as they "move up the technology adoption ladder", said AMI-Partners in a statement. Small businesses in India account for 99 percent of the country's SMBs.

Dev Chakravarty, a Kolkata-based analyst at AMI-Partners, said in a statement that a key factor driving the growth of storage in the SMB market is the usage of business applications such as ERP (enterprise resource planning) and CRM (customer relationship management).

Other factors fueling storage expenditures include the deployment of Web sites and e-commerce, and SMBs' increased focus on data security and backup.

Chakravarty said that storage requirements will increase as businesses adopt data backup, disaster recovery, and data replication technologies.

According to AMI-Partners, there is a difference between the small and midsize businesses when it comes to storage investments.

While small businesses are focusing on hardware-related technologies such as PC- and server-attached storage, medium-sized businesses are adopting "more advanced network-attached storage media such as SAN (storage area network) and NAS (network-attached storage", said Chakravarty.

Midsize businesses--defined as having between 100 and 999 employees--also invest more on storage-related services, because they have to manage "substantial quantities of data" compared to small businesses, Chakravarty said.

"Moreover they are on a rapid growth path buoyed by the nationwide economic growth," he said, adding that medium-sized businesses are gradually expanding their businesses.

"This expansion results in a jump in the quantity of data handled, and consequently, the requirement for robust data storage also surges," Chakravarty said. "Data archiving requirements due to regulatory bindings and compliance needs is also an important driver."

Sixty percent of midsize businesses surveyed by the research house said that increasing IT storage capacity and deployment of enhanced storage solutions will be a primary strategic focus area for them in the next 12 months.

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