Small and medium businesses in Malaysia are expected to spend $4.6bn on buying, maintaining and updating their information and communications infrastructure during 2008, according to new research. Many companies are spending heavily to revamp data security, following losses in the past, say analysts from research firm, AMI-Partners Inc.

If predictions prove correct, the spending would represent an increase of 11 per cent compared to 2007's total. Manufacturing firms are likely to lead the increase in spending, a survey found.

“More than 90 per cent of small businesses in Malaysia ranked enhancing IT security as a key priority for investment in 2008,” said Daniel Sim, a Singapore-based analyst with AMI-Partners.

"Data backup and adding more IT storage were ranked by SBs as their second and third IT-related investment priorities for this year.”

“Their lack of focus on security in the past has resulted in losses, both financially as well as in sensitive company data,” said Sim.

In a survey conducted by AMI-Partners, executives at medium-sized businesses said implementing backup strategies and increasing internet bandwidth were amongst their top three priorities.

Security was also among the fastest growing areas of IT spending in Malaysia last year

Other areas where smaller firms are expected to focus spending include expanding data storage capacity, wireless technologies, remote hosting and software as a service (SaaS). Executives hope that to see these technologies help their workforce to become more mobile and more productive, AMI-Partners found.

AMI-Partners defines small companies as those with fewer than 100 employees, and medium companies as those with fewer than 1000.