According to new figures just released by Pierre Audoin Consultants (PAC) and TechMarketView, corporate software spend in the UK is down 3.9 percent in the UK. Not great news for software vendors.

But it’s also potentially small-fry against the value of software investments that are already being wasted each year.

According to research undertaken by SIRB member FrontRange last year, the average organization in the UK actually over-spends on the software by as much as 20 percent annually. This is a symptom of poor control – with many organizations routinely purchasing shelfware or duplicate licenses, individuals failing to purchase through the most effective channels (e.g. buying one-off boxed products when volume licensing agreements are already in place), and even renewing maintenance on software that is no longer in use.

All of these instances of poor management (and there are many more besides), contribute to a general over-spend that no organization can afford. But by understanding what software is on the network, the organization’s current licensing position and exercising tighter controls on procurement and deployment – the good news is that a significant portion of the current IT spend can be reduced with no detrimental effect on IT operations.

So while the reported 3.9 percent drop in software spend isn’t great news for the industry, the fact is that end user organizations that invest in better software management practices can actually save far more. And that, in turn, means they can afford to acquire the software they really need.

Matt Fisher is the Director of Marketing for FrontRange and a commentator on the SAM market. Follow him on Twitter: M_J_Fisher

This entry was posted on Wednesday, August 12th, 2009 at 8:18 am and is filed under Software Asset Management.