2009 IT, Enterprise Software Spending to Trend Down More Outside U.S. Than In

Dennis Byron

Forrester gets credit, by my superficial reading of the news wires, for being first out of the blocks with revised 2009 information technology spending projections. Such revisions are typically released in late July or August each year after the IT analyst and market research firms have seen calendar-quarter 2 results from the leading IT suppliers. (See these IT Business Edge articles for an analysis of the process.)


Apparently, warnings from the suppliers to investors after quarter 1, along with Oracle's off-calendar fiscal-year results announced on June 24, were enough for Forrester to decide that

 

"Global purchases of IT goods and services by businesses and governments in 2009 are projected to decline by 10.6 percent when measured in US dollars, compared with the 3 percent decrease previously projected"


The projection, surprisingly to me, indicates that the old saw about the U.S. economy sneezing and the rest of the world getting pneumonia still holds. Forrester projects "only" (my word choice, not Forrester's) a 5.1 percent decline in the U.S. annual IT market, as compared to the worldwide 10%-plus drop. Forrester says it still expects growth in U.S. IT "investment" to resume in Q4 2009, with 2010 expected to bring a revival of IT buying in other regions.

 

I would have thought there would be more homogeneity in the numbers, especially given the way massive U.S. government intervention into all types of industries is adding bureacracy to decision making. The flip side of that is U.S. government stimulus spending. But that is not all good news either.If U.S.-domiciled IT suppliers have to somehow prove their products were "Made in America," that will really slow down stimulus-based IT spending even more than typical government bureaucracy slows it down.

 

So do you expect to pick up your spending in November-December 2009, to take advantage of the almost certain end-of-year-2009 bargains that the IT industry will offer and to position your IT department for 2010 plans? Or is Forrester whistling by the graveyard with its projection of better days right ahead for U.S. IT departments?

 


(And -- on a side note -- do you still think of your IT spending as an "investment" or is it now merely a cost of doing business?)



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