Infoconomy Index: Converging economies
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The US high-tech economy has stepped down a gear - just as Europe's IT sector has started to show significant growth…
The US high-tech economy has stepped down a gear - just as Europe's IT sector has started to show significant growth.
In the Infoconomy Global Index, which reflects the combined growth of the world's 200 largest IT companies, growth dropped to 11% in January, down from 11.5% in December - the fifth consecutive month that the US-dominated index has recorded a decline. Though still trailing, the growth rate of the Index's subset of European companies closed the gap with a sharp rise of 1.4% to 5%.
Behind the global downturn were below-par performances from some of the industry's biggest companies. The largest negative impact came from systems and services provider Unisys, where revenues for the company's closing quarter of 2004 dropped 7%. A 2% revenue drop at Sun Microsystems, the server and systems software maker, was another negative influence.
In contrast, there was positive growth at some other industry bellwethers, although many cases fell short of the underlying industry rate of 11%. IBM and Microsoft chalked up a 7% rise in their latest quarters, while German business applications vendor SAP reported an 8% increase in revenues. Network equipment maker Lucent Technologies' revenue growth of 3% also pulled down the index.
Balancing the downward trend were revenue hikes at PC and device maker Apple and storage supplier EMC - 74% and 27%, respectively.
The further rise in the European index was spurred by revenue growth at chip-maker ARM (22%), software component technology company ILOG (26%), and that major boost from SAP. The 5% overall increase represents the region's fastest pace since April 2002.
That points to the progressive rise in European growth and to the continued slow erosion of the US-centric global index towards single digit growth.
The Infoconomy 200 Index measures the overall growth rate of the IT industry by tracking the financial results of the world's most important publicly listed IT companies.
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