Companies plan to increase spending in 2020 with Microsoft, Amazon, and ServiceNow and cut budgets for IBM, Box, and Oracle, JPMorgan survey says (MSFT, AMZN, NOW, IBM, BOX, ORCL)

  • According to a JPMorgan survey of 130 CIOs of large businesses, CIOs expect to increase their spending in 2020 with Microsoft, Amazon Web Services, and ServiceNow.
  • CIOs expect to decrease spending on services from IBM, Box, Oracle, and Dropbox, according to the survey.
  • Right now about one-fifth of IT budgets are spent on cloud, but CIOs expect it to rise to 43.9% in five years.
  • Visit Business Insider’s homepage for more stories.

Companies expect to spend more on Microsoft and Amazon’s clouds in 2020, while slashing IT budgets for products from IBM, Box, and Oracle, according to a new survey that JPMorgan conducted among 130 chief information officers.

In early June, JPMorgan asked CIOs where they plan to increase and decrease their companies’ IT spending, targeting execs running large businesses with massive budgets: The CIOs queried are responsible for $88 billion in IT spending, with an average budget of about $675 million per firm.

The survey found that Microsoft was the top beneficiary of increased spending by a wide margin. A net 47.7% of CIOs said they expect to increase spending on Microsoft — the net percentage takes into account that 60.8% of CIOs said that they would increase spending, and 13% said they would decrease spending. Amazon ranked next, with a net 26.2% of CIOs planning to increase spending on Amazon Web Services — with a total of 34% of CIOs planning to increase spending but about 8% expecting to decrease spending.

Microsoft and AWS are the top two cloud providers on the market, which may factor into why CIOs expect their cloud spending to rise so drastically for those two. Right now, only about one-fifth of IT budgets are being spent on public cloud, but CIOs expect this to rise to 43.9% in five years.

The coronavirus pandemic seems to be speeding things up, with 79% of CIOs saying that it will make them move to the cloud even faster than they had planned.

CIOs also expect to increase spending in ServiceNow (net 15.4%), Salesforce (net 13.8%), Google Cloud (net 13.1%), and VMware (net 13.1%). 

“Given the large average respondent size, we think that investors will appreciate the insight into which companies are most valuable to CIOs for helping them navigate their digital transformation journeys, and which companies are most integral to their future cloud computing plans,” the report said.

Where CIOs are slashing their budgets

Four companies saw a net decrease in spending. IBM saw the biggest net decrease of 13.1%, followed by Box with 10%, Oracle with 8.5%, and Dropbox with 4.6%.

IBM and Oracle may be seeing decreases as more companies move from using private data centers to the cloud. While IBM and Oracle do both have cloud offerings, AWS and Microsoft’s clouds are currently more widely-used by far. 

A Forrester report from late last year even predicted that IBM and Oracle are so far behind that they may stop trying to compete in cloud altogether. Oracle could instead focus on its applications and databases, the report said, while IBM could focus on hybrid cloud, which allows customers to store their data on the public cloud and private data centers.

Read more: IBM and Oracle are so far behind in the cloud, they might stop trying to compete with Amazon altogether and go a different route, analyst says

Box and Dropbox, which are both cloud storage companies, also face competition from Microsoft and Google, which both offer a suite of productivity tools that includes storage. Companies may choose to purchase a plan from them that bundles tools like email, chat, videoconferencing, and storage together, instead of buying storage through a separate provider. 

Got a tip? Contact this reporter via email at, Signal at 646.376.6106, Telegram at @rosaliechan, or Twitter DM at @rosaliechan17. (PR pitches by email only, please.) Other types of secure messaging available upon request.

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