Spending set to rise again
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IT directors, fetch the chequebook - its time to start spending again. This is what IDC, the global technology market research company, is telling suppliers to expect sometime over the next few months.
IT directors, fetch the chequebook - its time to start spending again. This is what IDC, the global technology market research company, is telling suppliers to expect sometime over the next few months.
At the European IDC Technology Forum in Monaco in September, IDC presented a detailed analysis of historical and current spending patterns in information technology, and reached the clear conclusion that spending is set to rise. In fact, John Gantz, chief research officer for IDC, believes that the IT industry can grow at double gross domestic product (GDP) for several more years - but it will eventually fall in line with GDP as the industry finally reaches maturity.
There are five reasons the industry will start growing again, says Gantz: the need for better electronic commerce and Internet services; the need for better business integration; a "scramble" to provide support for mobile devices; a need for much more effective IT security; and the move towards globalisation. All of these areas will require new investments. For example, he says, the number of transaction-centric web sites in Europe will grow five-fold in five years to 10 million as ecommerce kicks in.
A survey of US CIOs by Morgan Stanley suggests that any recovery is not imminent, however. Half of a sample size of 225 CIOs said their spending would remain flat in 2002.
Furthermore, there are clear signs of hardware over-capacity at the organisations sampled. Forty four said their servers were running at 60% capacity or less, and a further quarter said their servers were running at less than 80% capacity.
