IT spend to rise by over 6%

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IT spend to rise by over 6%

Tash Shifrin

Worldwide IT spending is set to increase by 6.3% in 2006 according to industry analysts IDC.

2006 is expected to see a 5.8% increase in IT spending in the US and 6% growth in Western Europe.

But spending in the Asia/Pacific region, excluding Japan, will show stronger growth, with a 9% increase overall. Spending in India is expected to rise by 21% while China will see a 14% increase in IT spending over 2006.

The global increase in IT spending is down from last year’s 6.9% figure, which was boosted by increased expenditure on infrastructure upgrades. This year, growth is expected to be stronger in the software market, at 7%, with hardware and services spending expected to increase by 6%.

Stephen Minton, vice president of IDC worldwide IT markets, said: “Last year, the intensifying infrastructure upgrade cycle drove IT spending to its fastest rate of growth since Y2K.

“Buyer activity really picked up in the second half of the year, contributing to improved margins and revenue for systems vendors and worldwide IT spending growth of 6.9% for 2005.”

But Juan Orozco, program manager, IT markets and strategies, added that IDC expected the upgrade cycle to weaken in 2006.

“There will be greater momentum in project-based spending and key application areas, including business intelligence and content management, as enterprises return to a focus on the front-end, strategic importance of technology,” he said.


 


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