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This report presents the findings from a survey of 168 government institutions regarding their Information and Communications Technology (ICT) budgets and staff allocation. The survey investigates how government institutions currently allocate their ICT budgets across the core areas of ICT spend, namely hardware, software, IT services, communications and consulting.
Introduction and Landscape
Why was the report written?
In order to provide a depth of insight into ICT vendors' and service providers' potential customers.
What is the current market landscape and what is changing?
Government institutions have been investing a considerable percentage of their total ICT budgets in hardware, software, and IT services in 2012 and 2013. Although investment in software is dominated by spending on software licenses, government institutions are placing a lot of emphasis on the adoption of on-demand models such as software as a service (SaaS).
What are the key drivers behind recent market changes?
The adoption of SaaS is gaining momentum amongst government institutions primarily driven by advantages such as scalability, flexibility, cost reduction, and ease of management.
What makes this report unique and essential to read?
Kable Global ICT Intelligence has invested significant resources in order to interview CIOs and IT managers about their IT Budgets. Very few IT analyst houses will have interviewed 160+ ICT decision makers in the government sector in H2 2012.
Key Features and Benefits
Understand how ICT budgets are set to change in 2013 in terms of their overall size.
Appreciate how budgets are allocated across the core elements of ICT spend, including hardware, software, services, communications and consulting.
Learn how ICT money is being spent in areas such as the data centre, applications, IT management and the network.
Establish how IT staff are typically allocated within government institutions.
Gain insight into with whom government institutions plan to spend their ICT money.
Key Market Issues
Government institutions invested 67% of their total ICT budgets in their core ICT systems in 2012, and retained this level of spending in 2013 as well.
In 2012, government institutions invested 25% of their total ICT budgets in internal development and maintenance, with spending in this area witnessing a slight increase of 1% in 2013, as institutions look to improve their transparency and develop customised solutions.
Government institutions have reduced their spending with specialist outsourcers by 1% in 2013 compared to 2012.
The increasing incidence of cyber and malware attacks is forcing government institutions to improve their security infrastructure. This is evident from the survey, as institutions are investing 12% of their total hardware budgets in this space.
In order to increase the agility of application development and rationalise and simplify the process of the software development lifecycle (SDLC), government institutions have been investing 17% of their total software budgets in application lifecycle management solutions in both 2012 and 2013.
Kable's survey shows that of the various hardware technologies, client computing receives significant attention from government institutions, with 21% of total hardware budgets allocated to this area.
Government institutions are gradually moving towards a cloud environment, which is evident from the survey with respondents allocating X% of their software budgets to software as a service (SaaS).
According to Kable's survey, enterprise applications are attracting the greatest share of software budgets in 2012, and this level of spending is set to be maintained in 2013.
A view of the survey findings by ICT function reveals that government institutions are investing heavily in data centre solutions, where they allocated 18% of their total ICT budgets in 2012.
According to Kable's survey, institutions in the government sector are allocating 47% of their total telecommunications budgets to converged voice and data services, as it helps them to reduce their telephone bills and redundant infrastructure by providing a unified network.