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Leadership / Digital Transformation

App investment static but smaller companies are the bigger movers

Enterprise software budgets are primarily being spent on software licensing, as investment in their own applications remains static, according to analysis from Kable.

Currently, 28 percent of organisations’ software budgets is spent on software licenses, while 22.2 percent is spent on the support costs and maintenance of software vendors.

Enterprises also spend 20.2 percent of their budgets on software as a service, while 18.0 percent spend their budgets on platform as a service.

Collectively, applications attract 32.2 percent of budgets on average, with the same figure allocated next year. This breaks down into 16.3 percent of software budgets currently going on application lifecycle and 15.9 percent going on enterprise applications, with the figures shifting slightly to 16.0 and 16.2 percent respectively.

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These figures were fairly consistent even with companies of different sizes. In fact, current application spending was slightly higher than the average in smaller companies, with 50-99 employees, at 33 percent. It was slightly lower in larger companies, with over 10,000 employees, at 31.3 percent.

These figures were set to change to 33.6 percent and 30.8 percent next year respectively. This could suggest that smaller companies genuinely are more agile than their larger counterparts in addressing application requirements.

Information management and IT management are attracting 13.9 percent and 13.8 percent of budgets respectively, with those figures set to rise slightly next year to 14.2 percent and 13.9 percent. 13.8 percent was spent on IT management software, remaining steady at 13.9 percent next year.

Security software was lower down the list taking 13.2 percent of current spend and rising slightly to 13.5 percent next year.

All figures come from Kable’s ICT Customer Insight survey, which polled 2685 respondents, from across the world in Q4 2014. The survey findings include data on hardware budget allocation, telecommunications budget allocation and software budget allocation. Subscribe to Kable here.
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