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IT opportunities survive despite gloomy outlook

A new report into global IT spending has found the downturn will not affect every region the same, allowing for some new technology investment opportunities to survive.

By Miya Knights, 5 Mar 2009 at 08:05

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The widely predicted downturn in global IT spending will not have a uniform impact on every country, industry or technology vertical, a new report has found.

Instead the report, published today by analyst Datamonitor and based on the responses of 520 IT decision makers, revealed many were more interested in improving efficiency than cutting costs.

Daniel Okubo, Datamonitor technology analyst and the report’s author, agreed with general industry consensus that IT spending would suffer as a result of the global economic downturn.

In fact, the analyst found the proportion of respondents from 14 countries surveyed towards the end of 2008 who were planning to decrease their IT budget significantly this year had risen to 8 per cent from three per cent at the beginning of 2008.

“However the findings are not as negative as might have been expected,” said Okubo, referring to the fact that the report also found IT budget growth would outstrip budget cuts in some countries and industry verticals.

Overall, the report found a noticeable correlation between an economies’ future outlook and the projected growth in its enterprise IT expenditure. But, as a result, the likes of Benelux, the Nordics and Australia were more optimistic about IT spending than the UK.

In the UK, as well as France and Italy, the proportion of respondents planning to decrease their IT budgets still outweighed those that are planning increases, where all three countries have projected negative gross domestic product (GDP) growth in 2009.

However, in spite of recessions and downward pressure on IT spending in these countries, the report also found there were still opportunities in vertical markets if vendors are able to demonstrate a thorough understanding of their requirements.

For example, the report predicted salesforce customer relationship management (CRM), financials, procurement and manufacturing execution would continue to see healthy levels of IT spending among manufacturing firms, while e-commerce investments would continue to bolster retail IT spending.

Okubo added: “Technology vendors should tailor their sales and marketing to address the specific needs of the enterprises they are targeting, while taking into account the economic conditions they are operating in.”