Govt. leads private sector in PC leasing market

Govt. leads private sector in PC leasing market

The PC leasing market in Australia has hit the $2 billion mark so far this year, and is expected to grow another 25 per cent by next year, according to a report compiled by finance company Credit Suisse (CS) First Boston.

What's more, the government sector is leading the charge in PC leasing, with mid and large corporates lagging behind.

Sydney-based leasing company Integrated Asset Management (IAM) has compiled research from a number of sources including international leasing consultants Amembal, Deane and Associates, CS First Boston and the Australian Equipment Lessor Association (AELA). The research claims that while the majority of government agencies lease PCs, only 60 per cent of large corporates and 30 per cent of medium-sized companies are leasing PCs in some capacity.

This contrasts with the US where 75 per cent of companies have adopted a leasing option.

According to AELA's annual report, 25 per cent of commercially-related Australian computer equipment is leased.

"Government policy has encouraged agencies and departments to lease, which has delivered up savings in capital outlays and big efficiencies in asset management," says Robert Spano, managing director of IAM.

"Technology upgrades are easier to facilitate via a leasing arrangement because the assets are not owned by the lessee, but by a lessor."

Spano says that while companies are beginning to see the cost benefits in leasing, the model is being driven by technology.

"A company's IT spend is seen as more of a commodity now," says Spano. "The Australian mentality has always been ownership -- to have the quarter acre block with the white picket fence. But that's beginning to change as people start to see benefits in leasing technology instead of owning it as a [depreciating] asset."

"People should be spending more on applications and intellectual property, than the hardware it runs on," he adds.

Spano claims IAM, which is a wholly-owned subsidiary of listed integrator Powerlan, is on target to grab a five per cent slice of Australia's leasing market by the end of the year. He believes vendor-leased PCs account for around 65 per cent of the leasing market followed by vendor-independent leasing companies with around 35 per cent.

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