[March 21, 2013]

ICT Adoption among India Small and Medium Businesses is Advancing Rapidly

At a time when overall business growth in India has slowed significantly and the national GDP shows only a marginal rise the India small and medium business segment (SMBs, 1-999 employees) can be viewed as a beacon of hope. India SMBs show a 14% year-on-year rise in Information and Communication Technology (ICT) expenditures and their adoption of technology is likely to continue to increase. This is a direct result of their need to utilize ICT tools to overcome nagging business challenges. An analysis of these markets reveals that SBs are likely to marginally overtake their MB compatriots vis-à-vis annual ICT spending growth rate. These findings have emerged from the 2013 India SMB ICT & Cloud Services Tracker Overview study by New York-based Access Markets International (AMI) Partners, Inc.

India SMBs are in an expansion and transition mode in terms of escalation in business and workforce. ICT is likely to play a vital role in their continued growth. "Basic computing and networking hardware dominates the IT spending portfolio of India SMBs. This is especially true for the small business segment which is gradually enhancing their ICT backbone serving as a platform for future adoption of higher-end technology solutions", says Dev Chakravarty, Research Manager at AMI-India.

Cloud computing has brought about a paradigm change in the ICT adoption pattern of SMBs worldwide. India SMBs are no exception to this statement. "Using AMI's Global Market Forecast Model, the industry's premier SMB market sizing tool, AMI has found that expenditures on cloud-computing within India SMB ICT portfolio are on the rise. These expenditures comprise almost 10% currently and are predicted to increase by a CAGR of 23% over the next five years", adds Mr. Chakravarty. It may not be an exaggeration to term cloud computing as a key future growth-enhancer in terms of India SMB ICT adoption since cloud-based ICT solutions display greater future growth-trends compared to their on-premise cousins

There are many questions regarding cloud computing usage by India SMBs; e.g. - What are the larger spend components within the cloud Which cloud categories will grow faster AMI analysis finds that the top two spend-components within the SMB cloud-portfolio are for website-related expenditures and Remotely Managed IT Services (RMITS). These SMBs have become much more aware of the benefits of hosting their own websites since it provides them multiple benefits such as better brand-building and cost-effective marketing to mention just two. A number of web-hosting firms have emerged to assist India SMBs in this endeavor. As mentioned RMITS is also an up and coming trend for these companies. Many India SMBs are indicating a greater preference for this alternative, sometimes in conjunction with the age-old on-premise service options. In the near future, IaaS and SaaS (News - Alert)-based solutions such as Productivity, CRM and Business Intelligence are forecast to show considerable growth.

Cloud computing has been instrumental in alleviating many problems that India SMBs face during ICT adoption - specifically those related to a lack of funds and non-availability of a dedicated ICT-workforce. Other key advantages of the cloud that appeal to SMBs include automatic updates, flexibility and scalability.

The external environment is also ready to support the migration to the cloud, with ISPs and Telcos having invested heavily in building an adequate bandwidth infrastructure. A mature Channel Partner (News - Alert) community of ISVs and SIs have equipped themselves with relevant cloud computing tools and techniques enabling them to offer their services to SMBs. "Future growth opportunity in the arena of more traditional ICT solutions are somewhat limited," stated Mr. Chakravarty. "Hence, in the face of stagnation, a significant proportion of channel partners have been adding cloud computing to their product and service lines in a bid to increase versatility and to meet the rising 'pull' from their SMB customers."

The importance of channel partners cannot be overstated. They represent the 'Route-To-Market' for India SMBs in terms of ICT procurement. Moreover, the role of channel partners in cloud computing is further emphasized by the fact that SMBs require a good deal of hand-holding and guidance in order to understand what cloud solutions suit their businesses best. In addition, significant shifts have occurred within the cloud-partner ecosystem with the advent of new cloud-focused partners a.k.a. 'Cloud-brokers' who are specialists in the arena of facilitating cloud computing transactions between buyers and sellers.

Related Studies

AMI's recently published "2013 India SMB ICT & Cloud Services Tracker Overview" provides marketing and product executives the insights to effectively enhance/tweak their go-to-market approach within India SMBs for a greater bottom line impact.

The study examines India SMBs' business needs, including ICT priorities, purchase channel preferences and buying behavior at a granular level. The analysis also delves into numerous individual ICT categories - both cloud and on-premise solutions - and provides a clear sense of the overall market opportunity/outlook for each and the forces shaping that specific category. Shifts in the India SMB ICT landscape - including purchase channels - are highlighted and illustrate how vendors can best leverage those shifts to deliver solutions profitably.

For more information about this study, AMI-Partners, or our global SMB research, call 212 944 5100, e-mail ask_ami@ami-partners.com or visit our web site at www.ami-partners.com.

About Access Markets International (AMI) Partners, Inc.

AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence - with a strong focus on global small and medium businesses (SMBs), and extending into large enterprises and home-based businesses. AMI-Partners' mission is to empower clients for success with the highest quality data, business strategy perspectives and ?go-to-market solutions. Led by Andy Bose, the firm has built a world-class management team with deep experience cutting across IT, telecommunications and business services sectors in established and emerging markets.

AMI-Partners has helped shape the go-to-market SMB strategies of more than 150 leading IT, Internet, telecommunications and business services companies. The firm is well known for its IT and Internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.

[ Back To Contact Center Solutions Homepage's Homepage ]