IDC Advises IT Vendors Not To Overlook The Middle Market - Industry Trend or Event

EDP Weekly's IT Monitor, July 31, 2000

IDC has a message to IT vendors: Don't ignore the middle market. According to the market research firm, the middle market - made up of companies with 100-999 employees - represents a golden opportunity. In 1999, the US middle market was 89,800 companies strong, and each spent an average of $765,400 annually on IT products and services. This means that cumulatively, US companies with 100-999 employees spent approximately $70 billion on IT in 1999.

"US middle market companies are often overlooked as an important IT market amidst the well-recognized names of Fortune 1000 corporations and the vast numbers of small businesses," says Merle Sandler, a senior analyst with IDC. "However, middle market companies exist in large numbers, and they yield weighty IS budgets, making them an important part of the US IT market." According to IDC, what is even more important than the amount the middle market spent on IT products and services is how much that amount increased from the year before - a solid 20.3 percent. IDC sees no signs of the growth letting up either as these firms embrace the Internet and ebusiness initiatives or look for innovative use of IT to give them a competitive advantage.

IDC research indicates the Internet is a highly regarded took at middle market companies. Nearly 96 percent of them had Internet access in 1999. "The extent of Internet access at these companies will continue to increase. More employees and more PCs will get access," Sandler said. "Their use of the Internet is rapidly expanding beyond email and information gathering to procurement, project management, and customer support."

Further demonstrating how important the Internet is to these firms is the fact that more than 73 percent of them have home pages. Of those who don't have a home page, two-thirds plan to create them. Approximately 20 percent of middle market companies' home pages support a sales function. IDC expects this number to increase dramatically in a very short time frame.