June 30th, 2008
Are more companies refusing to pay more for green IT?
There used to be a perception, not so many months ago, that your company would have to spend more to green-ify its IT infrastructure. But the flagging economy is apparently dashing any hopes that high-tech vendors might secretly have harbored that they could get customers to spend more dollars for the privilege of being green.
Rackspace, the hosting provider in San Antonio, Texas, recently surveyed its roughly 3,000 customers (about 180 responded), to get a sense of the financial sacrifices that may or may not be willing to make green tech cause. This is the second time the company has done such a survey, and while it is by no means scientific, the results are markedly different than last year.
Some quick highlights:
- 41 percent of the respondents said they would pay 5 percent to 10 percent more to work with a green vendor, off 11 percent from the 2007 survey.
- At the same, 46 percent of the respondents said they WOULD NOT pay more to work with a green IT vendor, if their prices were higher. This is up from 29 percent last year.
- 30 percent of the respondents said there were NOT WILLING to pay a premium for products or services just because they were concentrated on one of the following: renewable energy, recycling, conservation or carbon offsets. This was up from 8 percent last year.
“This year, people were less willing to trade of performance or spend more on their green technology. My gut tells me this is due to the economy,” says John Engates, CTO of Rackspace.
So, should your company get all cynical about the green tech movement. I really don’t think so. But the arc of the economic downturn is going to accelerate the downward price pressure that someone might be able to charge as a green tech specialist. Better, instead, to focus on how to differentiate your value proposition with the green tech message WITHOUT looking like a luxury item. Here’s how Rackspace is addressing green issues with its customers, without necessarily charging them more.
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Heather Clancy is an award-winning business journalist in the New York area with more than 20 years experience covering the high-tech industry. See her full profile and disclosure of her industry affiliations. See her full profile and disclosure of her industry affiliations.
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