End-user IT budgets are set to remain 'fairly level' over the next year, with IT departments focusing on systems management and security projects, according to research by analyst IDC.
As a result more projects are coming under closer scrutiny from the board and it means that vendors and their channel partners need to work harder at convincing users of the business benefits of technology deployments.
The IDC 2003 European Business User Spending Intentions survey interviewed 1,000 IT managers and directors across six countries in western Europe, including the UK.
Responses indicated a potential 5.5 per cent growth in IT spend. But IDC warned that this figure was likely to be nearer one per cent because of underspend on budgets, over-caution and budget adjustments.
Management concern about the value of IT investment was cited as the biggest barrier to investment by 30 per cent of respondents, followed by difficulties in understanding technology.
"Vendors need to be better able to demonstrate the value of those projects," said Chris Ingle, group consultant for IDC's systems group.
In this tough economic climate users are scaling back new IT projects and focusing instead on getting the most out of existing systems, according to the research.
"There is much more focus on the plumbing-type things and the basics such as systems and data management, security, and server consolidation," said Ingle.
Although corporate awareness of Linux has increased over the last year, with a third of respondents believing it to be a genuine alternative to Microsoft on the desktop, actual deployments remain limited.
"Deployments are up but we are talking very small numbers," said Ingle. "It is something people are considering as part of their desktop strategy, along with things like thin client."
Interest in wireless technologies has also declined, due to cost and security concerns, according to the survey.
Alex Kaye, managing director of reseller AK Marketing, said resellers need something unique to differentiate themselves from competitors when trying to sell to customers, because of the flat market.
"We focus on offering unique functions that our competitors don't have," he said."With the market remaining flat and no exciting growth opportunities, resellers need to have a unique selling point."
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