Menu
Gartner: IT spending drop-off worse than after dot.com bust

Gartner: IT spending drop-off worse than after dot.com bust

IT spending forecasts plummet sharply for hardware, declines further for software, IT services and telecom

Global IT spending is expected to decline nearly 4% in 2009 over the previous year as industry watchers confirm the current recession will see more losses than the dot-com bust in 2001, Gartner reports.

"The IT market slowdown will be worse than 2001, that downturn was tech-related. Today there is a general slowdown in demand for products and services across the board and IT spending is not immune," said Richard Gordon, research vice president of global forecasting at Gartner, Tuesday on a conference call announcing the spending forecast.

Gartner reported that global IT spending will reach about US$3.2 trillion in 2009, a 3.8% decline in growth from the $3.3 trillion spent in 2008 -- which marked a 6.1% growth over 2007. The research firm adjusted its spending forecast downward across all segments, attributing the cutback in spending to the economic recession. IT spending in 2001 saw a 2.1% decline, according to Gartner.

"The impact on IT spending is becoming clearer. As global economies continue to decline sharply, IT departments are trimming budgets and consumers are cutting back on discretionary spending," Gordon said. "The first quarter of 2009 provided confirmation that key markets and vendors have entered a recession."

Hardware in particular will see a nearly 15% decline as fewer companies invest in 2009 and are expected to spend $324.3 billion, compared with $381 billion spent on hardware in 2008. Software spending will be about flat at $222.6 billion. IT services will decline 1.7% with total spending reaching about $796 billion. As for the telecom sector, Gartner expects to see a nearly 3% decline in spending with total investments reaching $1.9 trillion.

Despite the promise of government stimulus packages in the long term, Gordon explained, they won't be able to offset the "bleak near-term outlook." Global financial markets have yet to stabilize, and that means IT buyers aren't confident on where to invest their budget dollars.

"Economic conditions have continued to erode business confidence in all regions. There is a continued general sense of uncertainty in the market and a lack of clarity of actual amount of toxic debt out there," Gordon said. "IT organizations will look for ways to shift spending from capital expenditures to operational efficiencies."


Follow Us

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags GartnerIT spending

Featured

Slideshows

Meet the Reseller News 30 Under 30 Tech Awards 2020 winners

Meet the Reseller News 30 Under 30 Tech Awards 2020 winners

This year’s Reseller News 30 Under 30 Tech Awards were held as an integral part of the first entirely virtual Emerging Leaders​ forum, an annual event dedicated to identifying, educating and showcasing the New Zealand technology market’s rising stars. The 30 Under 30 Tech Awards 2020 recognised the outstanding achievements and business excellence of 30 talented individuals​, across both young leaders and those just starting out. In this slideshow, Reseller News honours this year's winners and captures their thoughts about how their ideas of leadership have changed over time.​

Meet the Reseller News 30 Under 30 Tech Awards 2020 winners
Reseller News Exchange Auckland: Beyond the myths — how partners can master cloud security

Reseller News Exchange Auckland: Beyond the myths — how partners can master cloud security

This exclusive Reseller News Exchange event in Auckland explored the challenges facing the partner community on the cloud security frontier, as well as market trends, customer priorities and how the channel can capitalise on the opportunities available. In association with Arrow, Bitdefender, Exclusive Networks, Fortinet and Palo Alto Networks. Photos by Gino Demeer.

Reseller News Exchange Auckland: Beyond the myths — how partners can master cloud security
Reseller News welcomes industry figures at 2020 Hall of Fame lunch

Reseller News welcomes industry figures at 2020 Hall of Fame lunch

Reseller News welcomed 2019 inductees - Leanne Buer, Ross Jenkins and Terry Dunn - to the fourth running of the Reseller News Hall of Fame lunch, held at the French Cafe in Auckland. The inductees discussed the changing face of the IT channel ecosystem in New Zealand and what it means to be a Reseller News Hall of Fame inductee. Photos by Gino Demeer.

Reseller News welcomes industry figures at 2020 Hall of Fame lunch
Show Comments