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New Delhi: Indian companies, forced to reduce costs, are turning to device-as-a-service (DaaS) to support remote working.

DaaS adoption witnessed 65% increase in India in the past 11 months, more so among small and medium enterprises (SMEs), according to TeamLease Digital. Fast-moving consumer goods (FMCG), pharma, and banking, financial services, and insurance (BFSI) segments led the growth.

DaaS is a monthly or yearly subscription-based model where companies don’t have to pay upfront for every device and for its management and service, separately. It comprises laptops, desktops, and tablets with a bevy of programmes covering support, remote hardware and software management, cybersecurity and asset recovery.

“DaaS provides companies a cost-efficient, all-in-one solution to source and manage personal computers, software requirements, and storage solutions, along with round-the-clock service through a simplified contract," said Sudhir Goel, chief business officer, Acer India. Buying, configuring, and managing a computing device on one’s own can be costly, especially for SMEs, which typically have a lean IT team and small budget.

“This reduces capital expenditure, as well as operating costs for SMEs. They also benefit through a very nominal per seat expense spread over a three-to-four-year horizon," said Sanjeev Pathak, head, personal systems, commercial, HP India.

The pandemic has hit cashflows of companies across sectors, forcing CIOs to reprioritise their IT spending. In 2020, IT spending in India declined 2.7%, as per Gartner. It is, however, expected to grow 6.8% in 2021.

DaaS also reduces a company’s total cost of ownership (TCO) as well as protects them for concerns such as depreciation of devices after a few years of use. It also offers more flexibility as the plans are completely customisable and can be scaled up/down according to the company's requirements.

“DaaS offers companies the flexibility to scale up and down fast. It is also cost-effective, as it does not add to the capex," said Naren Bhagi, Associate VP and Business Head, IT Infrastructure, TeamLease Digital.

It also allows companies to re-allocate IT budgets as well as talent to more pressing areas of operations such as digitisation of services and innovation.

According to a 2020 study by IT research firm Techaisle, maintenance and support takes up 77% of SME IT staff time, leaving only 23% of time for transformation or innovation related activities.

“Moving away from onsite IT infrastructure to a device as a solution allows companies to offload aspects of IT responsibilities to external sources. This saves them time, money and frees up their IT teams to focus on driving the business forward," said Rohit Midha, director - Services Sales at Lenovo India.

To ease adoption of DaaS in SMEs, some solution providers offer finance plans. For instance, HP has finance offers through which SMEs can acquire business laptops starting at a subscription fee of 899 per month.

“Earlier customers in India favoured one time deployment versus paying every month or year. In some sectors security was a concern as many preferred control over their work devices," said Jaipal Singh, associate research manager, IDC India.

Singh points out, post covid-19, the mindset is changing. DaaS adoption is still not very big in India as compared to other markets, but many companies including SMEs in India have finally started showing interest in it.

Bhagi feels, the adoption of this model is expected to grow even more in the coming months. TeamLease Digital forecasts the adoption is expected to grow more than 90% in 2022.

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