As a percentage of IT budgets, software development and maintenance declined from 27% in 2018 to 19% in 2019, with almost no change expected in 2020 according to the Society of Information Management’s (SIM) annual survey of senior IT executives. At the same time, spending on cloud services has risen to 16% of the average IT budget and is expected to grow more this year. Hardware as a percentage of IT spending dropped significantly in the middle of the last decade, but those declines are moderating. It appears that companies are finding budget savings by 1.) paring back on commercial off-the-shelf software (COTS) used for both business applications and infrastructure management, and 2.) reducing spending on employees focused on day-to-day software maintenance and management.
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