According to results of a Gartner survey, organizations in Asia Pacific plan to increase their software budgets by 4.4 percent on average in 2010, while overall IT budgets were expected to decline by 3.1 percent on average. More organizations in Asia Pacific (38 percent) expect to increase their software budgets in 2010 than their overall IT budget (31 percent), the research house said.
The average expected increase in software budget of 4.4 percent is higher than all other regions surveyed including Europe, Middle East and Africa (EMEA), North America and Latin America, Gartner noted.
Gartner said it surveyed 323 IT managers in Hong Kong, China, Singapore, Malaysia, India, and Australia, as part of a worldwide survey of 982 respondents, to help business and IT managers compare their enterprise IT spending with peer organisations. Respondents were asked whether they expected their 2010 IT budget to be below, the same or exceed their IT budget for 2009.
Plans to use SaaS in the future are the highest in Hong Kong, followed by India and China -- a good mix of both mature and developed countries, said Gartner. However, SaaS spending continues to be fragmented within Asia Pacific, with variation by country, vertical and software segments, the analyst firm added.
India-based respondents are consistently the most optimistic, with the highest number of respondents intending to increase their IT budget in 2010 (42 percent), followed by China (32 percent), said Gartner. On the other hand, Malaysia-based respondents remain pessimistic, with the largest number of respondents intending to decrease their spending (52 percent), followed by Singapore (48 percent of respondents), Gartner added.
"For most organizations, the budgeting process happens once a year, but adjusting the IT budget is a continuous exercise that is driven by economic conditions and changes in the business," said Gartner research director Yanna Dharmasthira. "In the midst of economic volatility, hardware budget allocation remains the top priority in most countries, but software budgets are a real bright spot and continue to demonstrate a positive outlook, although more cautious when compared with last year's survey."
Software is expected to represent the second-largest portion of the IT budget in most countries, with the exception of India (where software and hardware spend are roughly equal) and Australia (where spending is notably higher on IT staff), said Gartner, adding that India is the most aggressive with the highest software budget allocation (26.9 percent), followed by Singapore (25.8 percent), Malaysia (24.1 percent) and China (23.1 percent).
When looking at horizontal enterprise applications, the software segment with the highest percentage of respondents indicating an increase in spending is CRM, followed by respondents in office applications, collaboration, and ERP software respectively, Gartner noted.