Forrester lowers prediction of global IT spend


Forrester lowers prediction of global IT spend

John-Paul Kamath

Global purchases of IT goods and services will grow 6%, down from the previous preliminary forecast of 9%, according to a new Forrester report.

"Our forecast is based on a mild recession in the US economy in the first two to three quarters of 2008," said Forrester Research vice-president Andrew Bartels. "While it is by no means certain that the US economy will in fact experience a recession, the risks of one are high enough to justify a more conservative outlook for the IT market."

The US remains the largest single market for IT goods and services, so it is no surprise that the global market is heavily affected by what happens to the US market. But US purchases of IT goods and services will grow 2.8%, down from its previous forecast of 4.6%.

Forrester uses several metrics to determine the health and size of the IT market: how much equipment, services and consulting companies and governments are buying from suppliers.

The US share of global IT purchases continues to contract. In 2003, the US market represented 40% of the global market for IT goods and services by 2008, it will shrink to a 33% share. Asia Pacific is the largest region for computer equipment the US and Asia Pacific each have about one-third of the communications equipment market. Only in software does the US market still dominate, with a 44% share of the global software market.

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