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The 2022 State of IT in APAC

For more than a decade, Spiceworks Ziff Davis has shared insights on global tech budget and adoption trends in the annual State of IT report. Last year, we expanded the scope of our study to include data on organizations in the Asia-Pacific (APAC) region, specifically.

To offer forward-looking, actionable APAC insights on IT budget and tech adoption plans in 2022, we’ve analyzed data from a recent survey of 259 IT buyers in the region (157 in Australia and New Zealand and 102 in Singapore).

Note: With 2022 being the second year an APAC-specific edition of the State of IT has been published, SWZD year-over-year (YoY) data does not trend back as far as in other regions. Additionally, survey respondents in APAC tended to be a bit more senior (e.g., CEO/CIO level titles) than respondents from other regions, so this viewpoint might have influenced differences in some cases.

Key findings from the 2022 State of IT in APAC:

  1. Corporate revenues in APAC are expected to grow YoY: 47% of businesses expect their revenues to increase in 2022, compared to 32% in 2021.
  2. IT budget growth in the region will continue to be healthy: 41% of companies in APAC plan to spend more on IT in 2022, with only 6% expecting tech budgets to decline.
  3. The global pandemic will continue to drive APAC tech spending: 46% of IT budget increases will be influenced by changes to business operations during COVID-19.
  4. Companies in APAC will allocate more of their IT budgets to managed services compared to businesses in North America (18% vs. 15%, respectively)
  5. Tech vendors can expect many contacts within APAC accounts to change: 33% of IT buyers plan to look for a new job in 2022, compared to 25% in North America (NA) and Europe.

Business outlook for APAC in 2022

Going into 2021, more businesses in APAC expected sales figures to decrease (41%) than increase (32%). Fortunately for businesses in APAC, revenue expectations have improved considerably over the last year, flipping into net positive territory.

Companies in APAC are now relatively optimistic about their 2022 prospects: 47% expect corporate revenues to increase YoY, while 20% believe revenues will fall. 

Expected Revenue Changes in APAC

The 2022 State of IT in APAC

While this news is great for businesses in APAC, organizations in NA and Europe are even more optimistic about top-line growth over the next 12 months. Most companies in NA (64%) and Europe (57%) expect revenues to rise in 2022, with relatively fewer expecting a decrease.

Expected Revenue Change By Region

The 2022 State of IT in APAC

2022 IT budgets to remain strong in the Asia-Pacific Region

Our data revealed that businesses in APAC planned to prioritize technology investments to maintain business continuity and enable remote workers during the pandemic, despite negative revenue expectations going into 2021. 

Going into 2022, IT budget growth will accelerate: 90% of businesses in APAC plan to increase or maintain tech spending (compared to 83% in 2021), and fewer organizations plan to lower IT budgets YoY.

Expected Budget Changes in APAC

The 2022 State of IT in APAC

Among businesses raising tech budgets in 2022, the average YoY spending increase will be 22%.

Remote work will continue to drive spending in APAC

Over the course of the pandemic, most businesses invested in tech to support the shift to remote work… more so in APAC than in other regions. The 2021 State of IT in APAC  revealed that 87% of companies in the region planned on making IT changes due to COVID-19 vs. 74% in NA. 

Last year’s elevated spending plans were correlated with levels of remote work. Our data revealed that, compared to organizations in NA, a greater percentage of employees in APAC worked remotely before the pandemic (25% in APAC vs. 15% in NA). Additionally, 2022 State of IT data indicates 48% of workers in APAC worked remote long-term following the emergence of COVID-19, compared to 34% in NA.

Accordingly, businesses in APAC expect ongoing remote work challenges to persist into 2022 — creating opportunities for tech vendors. Compared to businesses in NA, significantly more in APAC expect to deal with issues provisioning hardware to remote employees (28% vs 17%, respectively) and tracking inventory and licenses for remote employees (27% vs. 15%, respectively).

Why budget increases will accelerate in APAC in 2022

Data from the 2022 State of IT shows that pandemic-related factors will continue to influence tech spending in a big way over the next 12 months. Changes to business operations due to COVID-19 will be the top factor driving IT spending increases in 2022 — cited by 46% of businesses that will raise tech budgets — followed by an increased priority on IT projects (44%), heightened security concerns (41%), and supporting remote workers (38%).

Factors Driving 2022 IT Budget Increases in APAC
(Among companies growing tech spending YoY)

The 2022 State of IT in APAC

Notably, with elevated levels of remote work planned in the region, changes to business operations during COVID will be more of a factor in APAC (46%) than in NA (28%).

Also worth mentioning: While expected revenue growth in APAC has contributed to some plans to increase IT budgets in 2022, this is a secondary factor across all regions.

As supply chain issues affect the entire globe, approximately one in five businesses cite rising product costs (23%) and inflation (18%) as reasons they plan to increase tech budgets.

2022 IT budget allocations in APAC

At first glance, planned regional budget allocations in 2022 look similar across hardware, software, cloud, and managed services. Hardware and software will account for the greatest percentage of IT budgets globally, with cloud services and managed services factoring in to a lesser degree.

However, businesses based in APAC and Europe will allocate a significantly greater proportion of overall IT budgets to managed services than organizations in NA  — 18% vs. 15%, respectively. Additionally, companies in APAC will spend proportionally less on cloud services (21% in APAC vs. 27% in NA).

2022 IT Budget Breakdown Across Regions
(Percentage of total IT budget)

The 2022 State of IT in APAC

IT purchase triggers in APAC

To help explain variations in spending across tech categories in different regions, 2022 State of IT respondents revealed triggers that prompt their organization to buy new hardware, software, and services.

Overall, growth/additional need is the primary driver that triggers spending, followed by update/refresh cycles, and end of life. However, significantly fewer respondents in APAC said end-of-life events and refresh cycles typically prompt organizations to make purchases, relative to their counterparts in NA and Europe. 

This finding suggests recent tech investments in APAC have contributed to a refresh of much of the legacy technology in the region.

Top IT Purchase Triggers Across Regions

The 2022 State of IT in APAC

Compared to those in NA, businesses in APAC and Europe are significantly more likely to cite a need for better tech expertise and tech support as a reason to make an IT purchase. These needs are both reasons to enlist the help of managed services providers, shedding light on why differences exist in budget allocations across regions.

Note to tech marketers: While businesses in APAC and Europe are significantly less likely to upgrade technology on a regular refresh cadence, they’re significantly more likely to opportunistically respond to discount offers than their counterparts in NA.

IT Purchase Trigger Outliers in APAC

The 2022 State of IT in APAC

Securing the remote workforce in APAC

As more employees work from home and eventually in public spaces, businesses around the world are rightfully concerned about protecting corporate devices and data. And with higher levels of long-term remote work expected in APAC and Europe compared to NA, demand for many emerging security solutions will be strong, especially in those regions, over the next two years.

Businesses in APAC and Europe plan to adopt a wide range of security technologies at higher rates than in NA, including breach detection and response systems; zero trust solutions; user behavior analytics; biometric authentication; and security solutions powered by artificial intelligence (AI).

Emerging Security Adoption Plans Across Regions
(Within the next two years)

The 2022 State of IT in APAC

Spending on managed security solutions will also be proportionally higher in APAC, accounting for 12% of overall managed services budgets, compared to an average of 10% among businesses in North America and Europe.

APAC is ahead in the push for cloud and emerging tech

In addition to newer security solutions, organizations in APAC are further along in the adoption of other emerging technologies than their counterparts in other regions. 

For example, going into 2021, 61% of companies in APAC planned to or had already accelerated cloud migrations due to the pandemic, compared to 41% in Europe and only 26% in NA.

Our latest data revealed that organizations in APAC have indeed pulled ahead in transitioning to the cloud. When asked if they had implemented hybrid cloud (integrating on-premises infrastructure with a public cloud), 45% of APAC-based organizations already had the capability, outpacing implementation levels in NA (35%) and Europe (37%). 

Looking into planned adoption levels of hybrid cloud, organizations in APAC are expected to maintain their lead over the next two years.

Business Adoption of Hybrid Cloud
(On-Premises Infrastructure Integration with Public Cloud)

The 2022 State of IT in APAC

Across a wide range of emerging technologies, adoption plans are significantly higher for organizations in APAC relative to those in NA: expected adoption in APAC will be more than double the rate in NA for serverless computing, edge computing, AI, blockchain, and virtual reality.

Emerging Technology Adoption Plans by Region
(Within the next two years)

The 2022 State of IT in APAC

Singapore will be far ahead of the curve in the adoption of a few technologies, with planned adoption rates even outpacing other countries in APAC across several key areas including serverless computing, 5G technology, Internet of Things, and blockchain.

Emerging Technology Adoption Plans in APAC
(Within the next two years)

The 2022 State of IT in APAC

In our global 2022 State of IT report, we predicted great churn in labor markets around the world. Among businesses in NA and Europe, 25% of IT buyers said they planned to look for or switch jobs in 2022, which could pose problems for tech marketers that will have to deal with changing contacts within their target accounts.

According to our APAC data, 33% of IT buyers plan to look for a new job in 2022. Among these job seekers, approximately three-fourths will consider remote jobs, further complicating the ability for tech brands to target prospects.

Many more tech and budget insights await

Looking for more data from the 2022 State of IT? You’re in luck. 

We have comprehensive data on tech spending and IT adoption across companies of different sizes and in different regions. Check out our additional content for even more actionable insights, and if you’d like to schedule time with one of our experts to dive deeper into APAC-specific findings from the 2022 State of IT, let us know!

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