IT spending recovery still in doubt

UK public sector cuts are unlikely to hold back global spending in the sector

Enterprises that postponed IT spending over the past year are set to start cautious reinvesting, according to Gartner.

The analyst firm said that spending across all technology areas will grow by 2.9 per cent globally, taking the total to $2.4tn (£3.16tn), and that 2009 was a "challenging year".

All areas are set to increase their spending, with the public sector likely to see the biggest investments. Over all, though, the growth is not as high as predicted, and Gartner has had to reduce its expectations.

"The enterprise IT market will certainly return to growth in 2010, but we now expect it will grow by only 2.9 per cent globally, down from 4.1 per cent growth we had forecast earlier this year," said Kenneth Brant, research director at Gartner.

"The national and international government sectors will experience the strongest growth rate in 2010, with IT spending growing four per cent in 2010."

Other industries set to increase their investment include communications and media, which are likely to increase investment by 3.6 per cent, and healthcare by 3.2 per cent.

Gartner will advise its technology clients to remain cautious about how much their customers will spend, and concentrate first on those industries in which it sees the most immediate growth. Even this it said with some reservations, though, as next year could see investment levels stagnate.

"The bottom line is that technology providers need to be prepared for the worst case, where commercial IT markets stagnate and governments transition to fiscal austerity programmes," said Brant.

Forrester Research, meanwhile, sees increased investment in hosted, or software-as-a-service, options, and predicts that a continued slowdown will take its toll on spending elsewhere.

This spending will make a marked change of approach for the majority of firms, which Forrester said had paid little attention to emerging technology during the worst of the recession.

"With IT budgets under siege, chief information officers are scrambling to bring spending into line with the new economic reality," the company said in a report.

"As such, they are looking at cloud and software-as-a-service options that were completely off their radar just 18 to 24 months ago."