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Business Management

Dan Swinhoe (Global)- Do SMBs Need More Coffee, or Security?

According to AVG, 22% of SMBs spend more on coffee than they do on IT. 22%! That's a hell of a lot of companies spending a hell of a lot more on coffee.
For an idea of how much, the maths goes something like this; according to Spiceworks, there are around 18 million SMBs worldwide, with an average annual IT budget of $152,000.

So:

$152,000 x 3,960,000 companies (22% of 18 million)

=$601,920,000,000 annual IT budget

=$1,649,095,890.41 daily IT budget.

While the report doesn't say how much more companies are spending on coffee, if we assume it's only a little bit more, SMBs are still downing over $1 billion worth of coffee a day.

While it may seem like a trivial fact, there is some importance to it. While companies are spending money on caffeine, they aren't spending money on useful things, like security. And while people may think they need coffee, their companies probably need better security. The study said that one in six SMBs had suffered a security breach in 2011, and between the millions of lost man hours, lost revenue opportunities and replacement equipment, that's an extra $22 million lost that could've been added to the coffee budget.

The problem looks like it's going to get worse. According to Symantec, attacks on SMBs are on the rise. Last year around 18% of attacks were on companies with less than 250 employees, a figure which has doubled in the first half of 2012. While companies with 2500+ employees have seen a drop in attacks, hackers may be using the lax security of their smaller suppliers as a stepping stone to get to those bigger organizations, exploiting the weakest point in the supply chain.

Mobility is popular among SMBs. iPads and other tablets were one of the main drivers of non-caffeine spending last year with 62% already deploying, or planning to deploy the devices around the enterprise. The BYOD trend continues to grow, but security still remains a grey area. Users and IT departments often clash in deciding who is actually responsible for device security, and almost three quarters of SMBs do not agree that the use of mobile phones in business may represent a threat to IT security.

Elsewhere, the cloud is a set to be a big source of spending in the coming months and years. 48% of SMBs currently use the cloud, and that figure is expected to rise to 62% by the end of the year, global spending totaling $40 billion. Spending and adoption figures are expected to rise steeply in the coming years, reaching $100 billion by 2016. The lack of hardware costs is especially useful for SMBs with limited budgets, meaning more can be spent on that all-important coffee supply.

According to Spiceworks, the largest portion of actual IT budgets (40%) is allocated to hardware purchases, with software (34%) and services (26%) following behind. Most of the hardware money goes on desktops and laptops, while anti-virus and recovery top software choices.

Businesses often only realize the cost of cyber-attacks after experiencing one. SMB budgets vary massively all over the world, and in some regions it's less than $10,000 a year, spending what little they have as and when they need to with little planning for the future or possible risks. The good news is budgets seem to be increasing steadily year-on-year, and even if companies drank the world's most expensive coffee, at $80 a cup $1.6 billion a year equals 20,613,698 cups, so no one is going to go thirsty.

By Dan Swinhoe, Editorial Assistant, IDG Connect

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Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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