BOSTON – A new IDC study has revealed that among small to medium-sized businesses, concern about the economy outweighs interest in potentially innovative new technologies and “green” initiatives.

The far-reaching survey, entitled “Taking the Temperatures of SMBs Worldwide: Regional Attitudes and Technology Interests, Mid-Year 2008,” assessed the current level of interest or concern in five areas: future economic growth and business conditions, “green” technology, Software-as-a-Service (SaaS), virtualization, and the use of the Internet as a key business resource.

While there are differences across each region, current economic growth and business conditions are by far the greatest concern for SMBs, particularly in North America, Latin America, and Western Europe.

“While the growth of SMB investment in technology will continue to outpace spending growth in larger firms, economic and business conditions are on everyone’s mind,” said John Roberts, Research Manager for Global SMB Research at IDC.

The study also found that, in general, smaller companies across all regions experience concerns that are more tactical and near-term, but as economic conditions grow more challenging this view is being shared increasingly by mid-sized firms as well.

The use of the Internet as a key business resource was considered by IDC analysts to have the greatest growth potential in terms of future interest among SMBs.

“Despite the global slowdown, SMBs across all regions need to look ahead to when the global economy rebounds,” advised Roberts. “Most still have a near-term focus, with only modest interest in technology areas that have been getting a lot of attention elsewhere.”

Roberts suggested that SMBs could stand to focus more on eCommerce, customer relationship management (CRM), Business Intelligence, wireless mobility and voice/data convergence solutions such as VoIP. He cited these areas in particular as ones that SMBs were either not deploying fast enough or missing out on altogether as ways to improve their businesses over the long term.

The reason SMBs are not deploying such solutions more quickly, according to Roberts, comes down to the “buy technology only as needed” mentality among small businesses.

“The value proposition of making (often substantial) investments in areas such as VoIP needs to be explained and delineated by vendors more strongly and clearly to get around this way of thinking,” said Roberts. “The midmarket segment, being larger and often having actual IT budgets, could be an easier sell, but again, the value proposition is all important when it comes to new and cutting edge technologies that will benefit the SMB segment in the longer term.”

According to the study, virtualization and “green” technologies are not yet registering with the majority of SMB owners, except in more advanced mid-sized businesses. SaaS has a somewhat higher level of visibility, however, and IDC also expects interest in both SaaS and virtualization to increase in the next 12 to 24 months as vendor promotions gain traction.

By contrast, IDC analysts said they don’t expect “green” to change much in the near future, stating that “going green” will be a much tougher sell in underdeveloped areas.

“Cost is probably the biggest factor why green hasn’t caught on yet in the SMB segment,” said Roberts. “Being socially responsible is an admirable goal, but for these companies, and small business in particular, watching the bottom line is of paramount importance.”

According to Roberts, SMBs may start to move in a greener direction once green IT adoption becomes more commercially viable. At this time, however, it’s simply not a high business priority for SMBs.

“Significant work will need to be done, once again, to explain to SMBs why it is in their best interest, from a business standpoint, to go green, and why this should take priority over other business technology requirements, and this is something that IDC does not see occurring anytime in the near future,” said Roberts.

This column was written by Erin Bell of ConnectIT

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