Web Hosting Services Firm, New Edge, Completes IT Cost and Compensation Study
New York, New York - (The Hosting News) - January 23, 2008 - Earthlink subsidiary and broadband network company, New Edge Networks, has sponsored a new study concerning the increase of IT spending, and its effect on heightened compensation,
identifying and quantifying 2008 patterns and priorities.
The fifth annual RIS News/ IHL Group Store Systems Study, co-sponsored by New Edge Networks, sought to identify and quantify IT spending patterns and priorities. This was the first year the survey quantified the correlation between IT spending and salary increases among IT decision makers.
Greg Griffiths, Vice President of Marketing for New Edge noted, ”As the old saying goes, you have to spend money to make money. This certainly is pertinent in IT spending among retailers. Increased IT spending improves store efficiency, productivity, and profits that are ultimately shared with people responsible for deployment in the form of larger salary increases and bonuses.
According to the study, if store-level IT spend increased 5 percent or more, the average salary increase was 4.8 percent; if IT spend increased less than 5 percent, the corresponding salary increase dropped by more than 6 percent to 4.5 percent. If there was a decrease in overall IT spending, the average salary increase was less than 3 percent.
Greg Buzek, President of IHL Group, based in Franklin, Tennessee noted, ”There is a clear relationship between store-level IT spend increase and your collective pay raise. The bottom line is really the bottom line. Evidence from the study suggests that if you can convince your management to significantly increase your store IT budget, this tends to provide a greater salary increase for you.”
Overall, IT decision makers in the study reported average salary increases of 4.6 percent over the past 12 months, almost twice the inflation rate over the same period. For 2008, the top IT priority for more than half of study participants is the need for compliance with Payment Card Industry, or PCI, security standards. New Edge builds and manages private wide area networks that are compliant with PCI standards.
Store functionality was among various areas of focus for this year’s Store Systems Study. The survey assessed five specific technologies intended to increase the efficiency of store operations. These are: VoIP, RF (contactless) payments, biometrics for staff, biometrics for customers and prioritizing network traffic.
Mr. Buzek added, ”Prioritizing network traffic and VoIP were the most readily embraced technologies of this group as 28 percent and 20 percent, respectively, of retailers were already using them.”
New Edge Networks, the business communications unit of EarthLink Inc., also announced plans to offer a telecommunications industry-first: A network service that allows businesses to tag and prioritize data applications traffic with classes of service over low-cost, high-speed digital subscriber lines commonly used for wide area networks. Currently, traffic tagging and prioritization with class of service are available only on more costly high-capacity T1 lines with MPLS technology, short for Multi-Protocol Label Switching. Overall, 2008 store IT spend seems to match retail revenue increases for 2007. Survey results show IT spending will be greatest among smaller retailers rather than larger stores.
Mr. Griffths continued, ”The path to increased profitability and performance improvement is through a high-speed wide area network. If IT spend/salary trends continue, 2008 could be a particularly good year for the IT decision makers at small and midsize retailers.”
IHL Group is a global research and advisory firm headquartered in Franklin, Tennessee, that provides market analysis and business-consulting services for retailers and information technology companies that focus on the retail industry.
EarthLink, which acquired New Edge Networks in April 2006, has been investing in the company to capitalize on market growth opportunities in network communications services among small and midsize businesses.
New Edge Networks, based in Vancouver, Wash., is a wholly owned subsidiary of EarthLink Inc. (NASDQ: ELNK). New Edge Networks builds and manages private networks for businesses and communications providers. Through its nationwide backbone network with about 900 switches and Internet routers, New Edge Networks uses any blend of access technologies (xDSL, frame relay, ATM, cable, wireless, and satellite) for providing broadband connectivity at any business address in the United States. Network options include any combination of access, network management functions, and on-site installation services.
For more information about the RIS News/ IHL Group survey, please visit: www.newedgenetworks.com/go/ris/.
To learn more about New Edge Networks, please visit: www.newedgenetworks.com.
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