IT spending overtaken by compliance issues
VARs face losing out as shipments of new technology fall, but revenue opportunities are still there
Spend on IT to ensure compliance with regulations will outweigh spend on new technologies, according to research by market analyst Gartner.
The research, which assessed trends that will impact people, business and the IT industry, found that this pattern will continue through until 2010, with regulatory compliance IT spending growing at twice the rate of general IT spending.
Regulations such as Sarbanes Oxley and the Waste Electrical and Electronic Equipment directive have seen some firms scrambling to ensure they are covered.
The trend could prove a double-edged sword for resellers with shipments of new technologies falling, but increased trade from firms keen to get up to speed.
Jorge Lopez, managing vice-president at Gartner, said: “New regulations will change the business realities that executives must confront. Most of these will also cause change for IT. The best organisations take the lead to work on the legal and financial aspects of the business.”
Ash Hussein, sales and marketing director at security reseller Axial Systems, said: “We have seen legal requirements initiate projects. As more people are made aware, the demand will rise. People want more information about regulations and the demand at the moment is customer driven.
“We see confusion, and resellers do not have the answers yet. Different companies have different standards, with some prepared for compliance and some unsure. This is where VARs need step in to assist them.”
Shaune Parsons, managing director at reseller Computer World Wales, said the SME market in particular is restricted by IT budgets as they attempt to become compliant.
“The SME companies’ money can only go so far and some cannot afford to invest in new technologies.
“Resellers should get out to their existing customer base as SMEs can be lead by VARs. We, as suppliers, do not do enough to push software and upgrades for new regulations,” Parsons said.