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Dec 2016 - Market Forecast - Doc # EMEA41912016

Western Europe SMB IT Spending Forecast, 2016–2020

Authors: Carla La Croce, Angela Vacca, Serena Da Rold

This IDC Market Forecast presents the outlook for IT spending among Western European small and medium-sized businesses (SMBs) by company size and vertical market.

IT spending by SMBs in Western Europe will exceed $130 billion by 2020, generating a 1.5% CAGR over 2015-2020. The SMB segment represents a third of the total IT market, despite the relative fragility of smaller companies in the recently troubled economic scenario and their relatively small IT budgets. Hardware drives the IT spending of micro-enterprises, while in the midmarket, IT spending is more skewed toward IT services. New investments will be driven primarily by innovation accelerators and 3rd Platform technologies.

IDC defines SMBs in Europe as companies with 1–499 employees in a country. IT spending forecasts for the SMB segment are provided and analyzed by size band and vertical market at the regional level and for the top 5 Western European countries (France, Germany, Italy, Spain, and the U.K.). For the purposes of this study, data is provided for five company size bands (1-9 employees, 10-99 employees, 100-499 employees, 500-999 employees, and 1,000+ employees) to allow comparisons with the large enterprise segment and with the total IT market.

"SMBs represent the backbone of the Western European market. Although they are traditionally more exposed to economic turmoil and have lower budgets to invest, they remain a big horizon to explore," said Carla La Croce, research analyst, Customer Insight and Analysis, IDC. "As new innovation technologies are taking place, the most important thing is to design a strategy to target the SMB segment better. Digital transformation, the advent of the Internet of Things (IoT), and the introduction of robotics, combined with cognitive systems, are creating new channels of investment directed to SMBs."

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