Brief: Technology spending is under the microscope in 2025. Every business is feeling the pressure to do more with less, but cutting the wrong corners in IT can cost far more in the long run. So, where should businesses trim the fat—and where should they double down?
The Balancing Act of IT Spending in 2025
Every IT leader is facing the same question right now: How do we reduce costs without creating bigger problems down the line?
It’s not just about budget cuts—it’s about spending smarter. Because while technology can be expensive, the right investments drive growth, security, and efficiency. On the flip side, the wrong cost-cutting decisions can lead to downtime, security breaches, and frustrated employees.
So, let’s talk about where to tighten the belt—and where to invest wisely in 2025.
Where You Can Cut Costs (Without Regret)
1. Old-School Hardware Procurement
Buying servers, desktops, and networking gear outright is an outdated approach. The upfront costs are steep, and you’re on the hook for maintenance, upgrades, and eventual replacements.
Smarter Move: Shift to Device-as-a-Service (DaaS) or a subscription-based model. Instead of sinking capital into depreciating assets, you get the latest hardware without the refresh headaches.
🔍 Example: Companies that have moved to a DaaS model have reduced IT capital expenses by up to 30% annually (IDC).
2. Bloated Software Licences
Many businesses are overpaying for software they barely use.
- Are you paying for extra licences no one uses?
- Do you have multiple tools doing the same thing?
- Are employees even using the premium features you’re paying for?
Smarter Move: Run a software audit. Cut underutilised licences, consolidate tools, and explore open-source or AI-powered alternatives where possible.
🔍 Example: A recent Flexera report found that 29% of SaaS spending is wasted due to unused or underutilised software.
3. Legacy Phone Systems & On-Premise Communications
If you’re still paying for an on-prem PBX phone system, it might be time to reconsider.
Smarter Move: Cloud-based communications (VoIP, Microsoft Teams, Zoom) offer better flexibility, lower costs, and built-in security.
🔍 Example: Businesses switching from legacy phone systems to VoIP cut telecom costs by 50% on average (Gartner).
4. Unmonitored Cloud Costs
Cloud services promise cost savings, but only if you manage them properly. Many businesses leave unused virtual machines running, overprovision storage, or forget about older cloud projects.
Smarter Move: Use cloud cost monitoring tools like Microsoft Cost Management or AWS Cost Explorer to right-size your cloud usage and eliminate waste.
🔍 Example: Right-sizing cloud workloads can reduce costs by up to 40% (McKinsey).
Where Not to Cut Corners
1. Cyber Security & Compliance
Some budget cuts can cost you everything—and cyber security is one of them.
A single ransomware attack can cripple a business. Weak security policies lead to data breaches, regulatory fines, and reputational damage. It’s not a risk worth taking.
Smart Move:
- Invest in Managed Detection and Response (MDR) for 24/7 protection.
- Implement Zero Trust security to prevent unauthorised access.
- Stay compliant with SOC 2 Type 2 and industry regulations.
🔍 Example: Cyber crime damages are expected to hit $10.5 trillion annually by 2025 (Cybersecurity Ventures). The cost of prevention is a fraction of the cost of recovery.
2. Employee Training & IT Support
An untrained workforce is a security risk and a productivity drain.
Cutting IT support might seem like a quick win—but it leads to longer resolution times, frustrated employees, and lost revenue.
Smart Move:
- Provide cyber security awareness training to reduce human error.
- Invest in AI-powered IT support to reduce downtime.
- Offer on-demand tech support to prevent minor issues from snowballing.
🔍 Example: Businesses that invest in employee security training reduce phishing-related breaches by 70% (Proofpoint).
3. Data Backup & Disaster Recovery
If a cyber attack, system crash, or natural disaster wipes out your business-critical data, do you have a backup plan?
Too many businesses realise too late that their backups aren’t actually recoverable when disaster strikes.
Smart Move:
- Implement automated cloud backups with redundancy.
- Regularly test recovery processes.
- Use immutable backups to prevent ransomware attacks from encrypting stored data.
🔍 Example: 60% of small businesses that suffer a major data loss shut down within six months (National Cyber Security Alliance).
Final Thoughts: Smart Spending in 2025
Cutting IT costs in 2025 isn’t just about saving money—it’s about investing wisely.
💡 Where you can cut: Legacy hardware, unused software, inefficient phone systems, and unmonitored cloud expenses.
💡 Where you shouldn’t cut: Cyber security, employee training, and data protection.
The right balance protects your business, reduces risks, and keeps operations running smoothly—without unnecessary spending.
Next Steps
Want to see where you can optimise your IT budget? F12’s team can help. Let’s build a cost-effective, secure IT strategy together.
