IDC: IT Spending Will Grow 6.3 Percent in 2006

While the retail mavens may be predicting a dour Christmas over late delivery of Windows Vista, researcher IDC's latest forecasts paint a somewhat sunnier picture.

IT spending globally is set to grow by 6.3 percent this calendar year, according to the research firm's most recent projections, released on Thursday. While that spending growth is moderate, it will represent the second year in a row of that level of growth. In calendar year 2005, IDC says, IT spending grew by 6.9 percent.

What is driving continued growth in IT spending, according to an IDC statement, is "economic stability in the U.S., Europe and Japan [which] combines with continued robust growth in emerging markets," IDC's statement said.

While IDC expects upgrade cycles to weaken somewhat this year, the company also predicts increased 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."

In the U.S., overall growth in 2006 will be 5.8 percent, a slight decline from the 6.4 percent growth of 2005, but still up slightly from IDC's January prediction of 5 percent.

The company sees the strongest growth coming in network equipment, outsourcing services and system infrastructure software, including security tools.

Improving economic conditions are contributing to increased spending for IT in Western Europe, where IDC sees growth of 6 percent this year. The Asia and Pacific region (excluding Japan) will grow 9 percent year over year in 2006, led by double-digit spending gains in China of 14 percent and in India of 21 percent, IDC said.

About the Author

Stuart J. Johnston has covered technology, especially Microsoft, since February 1988 for InfoWorld, Computerworld, Information Week, and PC World, as well as for Enterprise Developer, XML & Web Services, and .NET magazines.