According to MIC (Market Intelligence Center), an ICT industry research institute based in Taipei, Taiwanese SMEs (Small- and Medium-sized Enterprise) are expected to increase their IT spending by 0.7% in 2007. Growth momentum mainly comes from SMEs' demand for desktop PCs, servers, disk arrays, NAS (Network Attached Storage), VPN (Virtual Private Network) and VoIP (Voice over Internet Protocol) equipment. A survey conducted by MIC shows that in 2006 Taiwanese SMEs' IT investment on average reached NT$3.06 million (US$92,447.1; US$1=NT$33.1), representing a growth rate of 3.0%. In 2007, IT spending is expected to grow due to demand for integrating and upgrading existing software and strengthening information security, and due to IT hardware procurement and system maintenance.
According to MIC's survey, about 50% of SMEs have relatively large demand for new desktop PCs and servers, while demand for storage equipment mainly focuses on NAS and disk arrays. The survey also found that in network communications SMEs focus on VPN and VoIP, while their primary choices for IT software are CRM (Customer Relationship Management), ERP (Enterprise Resource Planning), and BI (Business Intelligence). IT outsourcing demand mainly revolves around application system design and development, maintenance of application systems, and design and set-up of websites. Taiwanese SMEs are rather conservative in their attitude towards Windows Vista, as hardware requirements for Windows Vista are high and as companies take their original schedule for IT hardware replacement into consideration.
Average IT investment of SMEs in the manufacturing industry was NT$2.5 million (US$75,528.7). In 2007, these companies are expected to focus on IT integration and strategic analysis in their software investments. The electronics industry is expected to aggressively invest in CRM and BI.
In the service sector, SMEs are expected to put emphasis on CRM, ERP, and BI in the coming three years. Wholesale retailers and companies with an employee base between 20 and 49 will have relatively strong demand for enterprise websites. Looking at IT services, due to the fact that domestic Taiwanese companies have been cultivating clients for a considerable period of time, they have won the trust of many Taiwanese SMEs. Both domestic and overseas IT service companies are highly regarded by SMEs in the manufacturing industry.
In 2006, on average each employee in a Taiwanese SME used 0.83 PC. Each member of an SME's IT support staff had to service 25 employees, and managed nearly 17 PCs. IT investment for each employee in SMEs amounted to NT$40,000 (US$1,208.5), while investment per PC reached more than NT$60,000 (US$1,812.7). In 2006, IT investment as a percentage of surveyed SMEs' revenue was 1.3%.
Geographically, SMEs located in the north of Taiwan were relatively ahead in terms of the value of IT investments and the level of IT used in the workplace, showing that there are still significant gaps between the northern, central, and southern regions of Taiwan. Furthermore, MIC's survey shows that listed companies are further along in terms of IT environment than companies which are not listed on the stock exchange.
Average investment in information security on the part of Taiwanese SMEs was NT$209,000 (US$6,314.2), representing about 6.8% of overall IT investment. In 2007, 12.9% of SMEs is expected to increase investment in information security, while 6% is expected to lower investment in this segment. In the coming three years, Taiwanese SMEs' demand for information security products will center on security assessment, content filtering, intrusion detection, and UTM (Unified Threat Management). Companies with an employee base of 100-149 or 150-199 will have significantly higher demand for the aforementioned products than companies with employee bases of 20-49 or 50-99. The service industry has considerably higher demand for these products than the manufacturing industry, while the highest growth potential for these products can be found in the southern part of Taiwan.
More information can be found in the following MIC reports: Taiwanese Small and Medium Enterprises' IT Spending, 2005-2006 , Taiwanese Small and Medium Enterprises' Information Security Investment, 2006-2009
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Market Intelligence Center, based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends, focusing on markets and industries in Asia-Pacific. MIC is part of the Institute for Information Industry.