Monday Morning Impact – April 20

Published On: April 20, 2020Categories: Buzz, Uncategorized

IDC: Worldwide IT Spending to Decline by 2.7% in 2020 due to COVID-19

Worldwide IT spending is now expected to decline 2.7% this year as COVID-19 impacts the global economy and forces many organizations to enact immediate contingency strategies. According to a report by market researcher IDC, spending on hardware, software, and IT services is likely to decline by more than real GDP overall, as commercial IT buyers and consumers implement rapid cuts to capital spending in line with declining revenues, profits, market valuations, and employee headcounts.

“Overall IT spending will decline in 2020, despite increased demand and usage for some technologies and services by individual companies and consumers,” said Stephen Minton, program vice president in IDC’s Customer Insights & Analysis group. “Businesses in sectors of the economy that are hardest hit during the first half of the year will react by delaying some purchases and projects, and the lack of visibility related to medical factors will ensure that many organizations take an extremely cautious approach when it comes to budget contingency planning in the near term.”

Major spending declines this year are now expected in PCs, tablets, mobile phones, and peripherals with overall devices spending expected to decline by 8.8% in constant currency terms. The PC market was already expected to decline on the back of a strong Windows-driven refresh cycle in 2019, but the crisis will significantly disrupt a smartphone market that was projected to post stronger returns this year as a result of 5G upgrades.

Spending on server/storage and network hardware are also expected to decline despite strong demand for cloud services as enterprise customers delay purchases during the initial rapid response phase of the current crisis. Total infrastructure spending (including cloud) will likely increase by 5.3%, but all of this growth will come from enterprise spending on infrastructure as a service (IaaS) and cloud provider spending on servers. Meanwhile, overall server/storage hardware spending are expected to decrease by 3.3% and enterprise network equipment spending will decline by 1.7%.

IT services spending is expected to decline by 2% in 2020, with the worst declines in project-oriented services as organizations delay major new projects until business visibility improves. Spending on managed services and support services will also decline, in line with overall IT activities and hardware/software deployments, according to IDC.

Including telecom and other spending, total ICT spending is expected to decline by 1.6% to just under $4.1 trillion. This compares to overall ICT growth of 3.5% last year, when IT spending increased by almost 5%.

On the bright side, the researcher predicts that software will post positive growth of just under 2% overall, largely due to cloud investments along with some resilient demand for specific categories, which will be a component of response measures or are integral to ongoing business operations.

Channel Impact®
The pandemic has brought about substantial change in strategies and spending habits as businesses hunker-down in anticipation of an eventual return to normalcy.

Study: Remote Work and Coronavirus Create Perfect Storm in IT Security

Check Point Software Technologies, a San Carlos, California-based cybersecurity vendor, has released a new study measuring the effects of Coronavirus on the IT security landscape. According to a company-commissioned survey, concerns around the pandemic, combined with the abrupt shift towards remote work, have caused a 71% increase in security threats or attacks since the beginning of the outbreak. The leading threat cited was phishing attempts (cited by 55% or respondents), followed by malicious websites claiming to offer information or advice about the pandemic (32%), followed by increases in malware (28%) and ransomware (19%).

In terms of adapting to a remote workforce, 95% of respondents said they are facing added IT security challenges. The three leading challenges were provision of secure remote access for employees (cited by 56%), the need for remote access scalable solutions (55%) and employees working from home were using shadow IT solutions – untested software, tools and services (47%).

More than 60% of respondents were concerned about the security risks of having to make rapid changes to enable remote working, and 55% felt that remote access security needed improving. 49% are concerned about the need to scale-up endpoint security.

“Cyber criminals will always seek to capitalize on the latest trends to try and boost the success rates of attacks, and the coronavirus pandemic has created a perfect storm of a global news event together with dramatic changes in working practices and the technologies used by organizations,” said Rafi Kretchmer, Head of Product Marketing at Check Point. “This has meant a significant increase in the attack surface of many organizations, which is compromising their security postures.”

The survey results reinforce Check Point’s recent findings that coronavirus-related domains are 50% more likely to be malicious than other domains registered since January 2020, and the average number of new domains registered in the three weeks from the end of February was almost 10 times more than the average number found in previous weeks. Similarly, Check Point’s researchers have uncovered several ‘Coronavirus specials’ advertised by hackers on the dark web, with ‘Covid-19’ or ‘coronavirus’ being used as discount codes for sales of out-of-the-box malware.

The survey was conducted by Dimensional Research, with 411 respondents from organizations of 500+ employees globally.

Channel Impact®
Amidst this rapidly evolving situation, channel partners need to help customers protect themselves with an end-to-end security architecture that supports accessible and reliable connections between corporate networks and remote devices, and the deployment of validated protection against advanced threats and cybercrime techniques.

HP Announces Partner & Customer Relief Initiatives

HP has announced a variety of relief initiatives aimed at helping its global channel partner base to effectively navigate the operational and financial challenges associated with COVID-19. In addition to providing a variety of financing and leasing options for end customers, the company will offer short-term, market and country-specific incentives for channel partners. Offers will vary by geography and are dependent on partner eligibility.

In addition, HP has implemented a flat-rate incentive program and relaxed compensation models to allow for more partner flexibility while extending deadlines for submission of proof of performance and reporting.

“As a global company, we understand the importance of acting globally while executing at the local level,” said Christoph Schell, HP’s Chief Commercial Officer. “Rather than taking a one-size fits all approach, we are taking a customized approach specific to the unique and evolving dynamics at the market and country level, depending on a variety of factors.”

HP’s Integrated Financial Solutions group is now offering a variety of financial and asset lifecycle options, including deferred/reduced payments until 2021, short term rentals and cash infusion for customer-owned HP devices through a sale leaseback program. Customers can also take advantage of a delayed payment structure or enroll in a PC rental program, available on equipment contracts for a period of 12 months.

HP will also offer its HP Sure Click Pro free of charge through September 30, 2020, to help protect users from web, email, and document-based security threats.

Channel Impact®
In a business environment turned upside-down by Coronavirus, it is incumbent upon major industry players like HP to launch initiatives that will keep their partner base afloat and their shared customers able to fully leverage Information Technology towards their continued survival.

Stay in the Know

Keep tabs on what’s happening in the channel and the impact it will have on the partner community by subscribing to Channel Impact communications.

Recent News

Search Buzz

Buzz Categories