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Russian SMBs Spend on Infrastructure

NEW YORK -- Small and medium businesses (SMBs or companies with up to 999 employees) in Russia are set to spend US$5.4 billion this year to strengthen their IT infrastructure, up some 36% over 2006, with the bulk of the SMBs citing data security as their topmost concern, according to the latest study from Access Markets International (AMI) Partners, Inc.

Almost 80% of SMBs said that protection from electronic threats is the major motivator to invest in IT security,” says Nichelle McKenzie, New York-based Analyst at AMI Partners. “In real terms that means, small businesses (SBs or companies with up to 99 employees) will spend US$16 million—and medium businesses (MBs or companies between 100 and 999 employees) will spend US$52 million— on security solutions in Russia this year.”

An increasing number of SMBs in Russia are also planning to promote employee training in IT skills and knowledge, invest in new facilities, push advertising and promotional campaigns, and work more closely with select channel partners. AMI-Partners’ survey reveals that 23% of SBs and 18% of MBs saw revenue increases in 2006, and 41% of SMBs said they saw an overall increase of over 17% in annual revenues.

The proliferation of computing products such as PCs and printers still accounts for the majority share of SMB IT investments. About 35% of SBs in Russia use PCs, mostly desktops. PCs and PDAs accounted for 75% of the 2006 total computing hardware spending which was about US$1.6 billion. Imaging, printing and peripherals made up 19% of the spending.

“Despite SBs accelerating their IT investments, almost 50% of non-PC owning SBs said that IT does not and will not play a key role in their overall business strategy;” Ms. McKenzie says. “About 40% said PCs are useful to handle simple organizational tasks. Russia SMBs are not brand-loyal; and white box or non-branded desktop PCs are the most common option for both SBs and MBs.”

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