IDC predicts bumper solutions crop

IDC predicts bumper solutions crop

THE fastest growing IT markets in New Zealand are security and IT solutions, according to latest research by analysts IDC.

IDC expects the IT solutions market to grow twice as fast as the overall IT market and predicts it will reach $1.7 billion this year, increasing to $2.3 billion over the next five years.

Jane McPherson, IDC market analyst, says the solutions market is becoming increasingly important with spending on solutions accounting for 34.2% of the total market in 2004. “Rapid growth is a result of end-users continuing to demand the purchase of IT as a complete solution, encompassing all the required hardware, software and services needed to address a specific business issue,” she says.

The strongest spending is expected to come from the government, education and finance sectors.

Security solutions will again experience the fastest growth, increasing by 25% this year and will be worth $221.4m by year end.

McPherson says the demand for security is being driven by government regulations.

“Although these aren’t new, most organisations in New Zealand are lagging behind in keeping up with requirements. I think this will continue to present opportunities for players in the market, particularly around planning and implementation.”

While software continues to be the largest of the applications markets, IDC expects growth to slow down due to the maturity and size of the market.

The software market was worth $449m in 2004 and by the end of the year it is expected to grow to $480.4m.

McPherson says applications vendors have been marketing vertically focused solutions for a number of years but, as the market matures, it’s becoming increasingly more important for vendors to take a close look at the differences between vertical segments.

“New Zealand vertical industries have experienced varied growth and have diffe-rent requirements and respond to different market drivers.”

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