Europe to lead tech industry out of recession

Tech purchases could rise by over 11 per cent in Europe this year

The technology downturn of the past couple of years is over, and global IT spending is set to rise by over eight per cent to more than $1.6tn (£1tn) this year, according to bullish new predictions from analyst firm Forrester released today.

The firm's US and Global IT Market Outlook: Q4 2009 predicts that global tech spending will bounce back from an 8.9 per cent fall last year, and that Europe will lead the way.

The strongest growth will be in western and central Europe, where tech purchases will rise by 11.2 per cent, boosted by the US dollar's decline against the euro, said Forrester. US IT spending will grow by a more modest 6.6 per cent in 2010 to $568bn (£351bn).

Report author Andrew Bartels said in a blog post that Forrester's relatively bullish outlook for tech spending this year is down to a continued weak dollar and a "new cycle of tech innovation and growth which we call Smart Computing".

These "smart computing" technologies, which include awareness, analytics, advanced applications, service-oriented architecture, server and storage virtualisation, cloud computing and unified communications, will drive the tech market to grow twice as fast as the economy, according to Bartels.

"Few chief information officers [CIOs] want to enter 2010 with a big IT budget increase when the economic and business outlook is so uncertain," he said.

"But as the recovery proves real, CIOs will get approval from chief executives to spend above their planned 'no-increase' budget to support the better-than-expected business growth."