News

Aberdeen Predicts Rise in IT Spending in 2003

• By Scott Bekker
• December 19, 2002

Analyst firm Aberdeen Group predicts an increase in worldwide IT spending in 2003 and beyond but researchers say they don't expect to see the kind of IT spending growth of the late '90s to happen again.

"The factors contributing to excessive growth in the late 1990s are not repeatable," Aberdeen researchers said in a statement released Thursday. The company attributes that '90s growth to corporate retooling surrounding Y2K, Internet and e-commerce euphoria, excessive VC investment in Internet startups, traditional enterprises spending to keep up with dot-coms and unsustainable IT spending in the telecom sector.

For 2003, Aberdeen Group predicts a more modest 4 percent increase in worldwide IT spending in 2003, tied to economic growth and "basic business principles." Worldwide, Aberdeen anticipates $1.26 trillion in IT spending in 2003, growing to $1.44 trillion by 2006. In the United States, that 2003 growth should be about 3.6 percent, according to Aberdeen.

The research firm also predicts that software and services spending will increase at the expense of hardware spending from 2002 to 2006. Over that period, Aberdeen forecasts increases in spending for software of 27 percent, for services of 18 percent and for hardware of 8 percent.