AMI Partners has a report titled "2005-2006 India Small Business Market Overview and Comprehensive Market Opportunity Assessment" & "2005-2006 India Medium Business Market Overview and Comprehensive Market Opportunity Assessment" which highlights the main trends in the Indian SMB Segment, Below are some excerpts from the release.

Small and medium businesses (1-999 employees) in India will spend up to US$576 million on packaged software this year, with the bulk of the amount going towards buying productivity, operating systems, databases and utilities software. These four software categories will comprise close to 70% of the overall packaged software spending in India this calendar year, according to the latest study by New York based Access Markets International (AMI) Partners, Inc.

"As most of the purchases will happen via channels, IT vendors are increasingly marketing their products through them. Channels provide both the market reach and the customer knowledge. As India SMBs are spread across several clusters through out the country, the reach of channels becomes a crucial factor."

The market is on track to grow a huge 25% this year - in line with last year's growth.

Solutions are increasingly becoming virtualized.

A few verticals such as manufacturing, retail, etc, are adopting these solutions rapidly.

India SMBs are already in the next wave of IT adoption.

Many SMBs realize that lags in their IT infrastructure will cost them a fortune when tech-savvy competition heats up.

"There is considerable demand for micro-vertical specific solutions, which are being developed by a few focused ISVs and some major vendors" says Mr. Chaudhuri. "These low-cost micro-vertical specific solutions suit the specific needs and pockets of SMBs." In general, as the overall economy is bullish, the spending power of SMBs is also at an all time high as are their IT budgets. SMBs have already realized that IT would boost their businesses and are asking for a full bouquet of solutions, rather than discrete pieces of software and hardware. They are increasingly turning toward total solutions with services associated in the IT purchases and SLAs for a better ROI.

Source: 1