Companies spend one-third of IT budget on mobility

European businesses are now spending almost a third of their entire telecom and networking budgets on mobile and wireless products and applications, according to a report.

Forrester Research's survey, entitled The State Of European Enterprise Mobility In 2006, says businesses are throwing money at mobility in the belief that it can deliver greater productivity, cost savings, and better employee morale.

It says European firms now spend 32% of their IT and communications war chest on mobility, with more than 70% of responding enterprises saying they are using some type of mobile application.

A third of businesses say refining mobile and wireless strategies and and policies has been a priority in 2006, with 16% calling it a 'critical priority'.

But Forrester's findings also show that mobility projects raise concerns about cost and reliability, especially as businesses start to build mobility into enterprise applications like sales force and field force management.

Forrester advises enterprises to stay focused on identifying what their genuine needs are while taking a step-by-step approach to realising the full benefits of mobility.

"It's good news that enterprises are strategically planning for mobility and benefiting from it," said Forrester analyst Jenny Lau. "However, there is a risk that mobility will remain a strategic agenda point that doesn't get realized. To turn strategy into reality, firms must devise a strategy and plan pilots with users, set handset policies early, and have contingency plans in place."

In addition, she says, it's best to start small: "Firms should see how mobility can give existing infrastructure a boost rather than planning for an ERP overhaul at the outset," she advises.

As ownership of devices becomes more or less universal across most enterprises, it is cutting edge applications and not hardware that are absorbing an increasing proportion of mobile spend, concluded rival research firm Analysys in a recent report.

"The compelling reason for adoption of mobile data applications is that enterprises aim to differentiate themselves and gain competitive advantage by improving responsiveness to customers," says Margaret Hopkins, a mobility expert with Analysys. "But it is not yet clear how much time and money they will be willing to invest in trials and application development."