ICT investment trends in utilities
Summary
A larger proportion of utilities have indicated that they are increasing their ICT spend in 2016 compared to the previous year.
Key Findings
Networking equipment and cyber security hardware are the two biggest items on utilities’ hardware budget, likely driven by the related challenges to security and communications posed by smarter systems
Software licenses are still the largest single item in software budgets—many utility-specific solutions are not available through XaaS models and utilities are still spending significant sums on licensing specialist and custom software such as energy market models
IaaS is the fastest growing cloud solution, in terms of new investment
Synopsis
ICT investment trends in utilities presents the findings from a survey of 112 utility companies regarding their Information & Communications Technology (ICT) investment trends. The survey investigates how utility companies currently allocate their ICT budgets across the core areas of enterprise ICT expenditure: hardware, software, IT services, communications, and consulting. The report illustrates the core technologies that enterprises are investing in, including business intelligence, IoT, cloud computing, and network services. The survey also highlights the approach to purchasing technology adopted by utility companies. The report aims to provide a better insight to ICT vendors and service providers when pitching their solutions to utility companies. The report focuses on utility companies’ ICT expenditure trends for specific business areas and technologies, identifying the top three IT projects, and understanding the business challenges faced by organizations.
In particular, it provides an in-depth analysis of the following:
How ICT budgets are set to change in 2016 in terms of their overall size
Allocation across the core elements of IT spend, including hardware, software, services, communications, and consulting
Distribution of ICT money in areas such as the networks, applications, service desk, and data centers
Which ICT functions utility companies are interested in outsourcing
Utility companies’ investment priorities based on their budget allocations across core technology categories such as cloud computing, business intelligence, network services, and security products.
Factors that are influencing utility companies’ investments in each technology category
How utility companies’ IT budgets are currently allocated across various segments within a technology category
Utility companies’ distribution of their ICT budget across various segments within a technology category
Vendor satisfaction ratings for various core and advanced technology categories
Insight into utility companies’ preferred buying approaches
Business objectives that utility companies are looking to achieve through their IT investment strategies
Factors that are influencing utility companies’ decisions to select an ICT provider
Reasons To Buy
Understand how the utility companies ICT landscape is set to change in 2016 to prioritize your target market
Comprehend how ICT money are being allocated by utility companies in specific geographies and size bands to improve your market penetration
Make effective business decisions by recognizing the opportunities within each of the core areas of ICT spend (hardware, software, IT services, telecommunications, and consulting)
Realign your sales initiatives by understanding the current strategic objectives of utility companies
Enhance your market segmentation with the included, detailed breakdown of opportunities within selected technology categories (business intelligence, security products, cloud computing, and network services)
Prioritize your focus areas by understanding which factors are influencing utility companies’ decisions when selecting an ICT provider
Understand the changes in customers’ priorities and identify the business objectives that utility companies are looking to achieve through their ICT investment strategies
- 1 Trends in ICT budgets
- 1.1 Introduction
- 1.2 Survey demographics
- 1.3 ICT budget changes
- 1.4 ICT budget allocation by core technology area
- 1.5 Likely growth in industry-specific ICT
- 1.5.1 Hardware budget breakdown
- 1.5.2 Software budget breakdowns
- 1.5.3 Third party IT services expenditure
- 1.5.4 Communications expenditure
- 1.5.5 Cloud computing budget
- 1.6 Outsourced IT functions
- 2 ICT investment priorities and vendor satisfaction
- 2.1 Introduction
- 2.1.1 Cloud computing
- 2.1.2 Business intelligence
- 2.1.3 Network services
- 2.1.4 Security services
- 3 ICT procurement trends
- 3.1 Introduction
- 3.2 Business objectives influencing IT investment strategy
- 3.3 ICT provider selection
- 3.4 Key decision maker for purchasing technology
- 3.5 IoT investments and uptake
- 4 Sector-specific trends
- 4.1 Introduction
- 4.2 Business challenges
- 5 Summary
- 5.1 Utilities are increasing their ICT spending in key areas like BI and IoT, but lack a clear direction
- 6 Appendix
- 6.1 Definitions
- 6.2 Further reading
- 6.3 Contact the authors
- List of Figures
- Figure 1: Utility companies - ICT survey geographic breakdown
- Figure 2: Utility companies - ICT survey breakdown by size band (number of employees)
- Figure 3: Recent and expected ICT budget changes among utility companies
- Figure 4: Utility companies’ (external) ICT budget allocation, 2015 and 2016
- Figure 5: Utility companies’ growth in industry-specific ICT
- Figure 6: Utility companies’ average hardware budget allocation
- Figure 7: Average allocation of software budgets in utility companies
- Figure 8: Utility companies’ average IT services budget allocation
- Figure 9: Utility companies’ average communications expenditure
- Figure 10: Utility companies’ average cloud computing budget allocation by technology
- Figure 11: Utility companies’ average cloud computing budget allocation by implementation type
- Figure 12: Outsourced IT functions – Utility companies’ current and future outsourcing priorities
- Figure 13: Cloud computing – Utility companies’ current and future investment priorities
- Figure 14: Business intelligence - Utility companies’ current and future investment priorities
- Figure 15: Business intelligence – selected primary provider and vendor satisfaction among utility companies
- Figure 16: Network services – selected primary provider and vendor satisfaction among utility companies
- Figure 17: Security services – selected primary provider and vendor satisfaction among utility companies
- Figure 18: Business objectives which influence utility companies' IT investment strategy
- Figure 19: Factors influencing utility companies’ decision to choose an ICT provider
- Figure 20: Role of key entities in making ICT purchasing decisions
- Figure 21: Primary integrator of IoT deployments
- Figure 22: Plans to adopt cloud-based IoT
- Figure 23: Importance of the following business challenges for utility companies
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