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More on Gartner's 2009-2010 IT Spending Forecast

Last week, Lee posted a note about Gartner's revised IT spending figures for 2009 and their forecast for 2010.

He hit on the most important point -- that Gartner doesn't expect IT spending to recover to 2008 levels until 2012.

Like many in the industry, I've been following IT spending projections closely over the last year, especially Gartner's, so I wanted to say a few more things about what Gartner's revised data seems to mean for the channel.

One point is that things are slightly better than they were. Gartner released this latest projection last week to make a splash around its Gartner Symposium/ITxpo, and the new forecast reflects some of the more positive numbers that are showing up in tech companies' latest round of earnings.

As awful as the numbers are, they're slightly better than they were earlier in the year. In July, drawing on data from the dismal first quarter, Gartner projected a 6 percent drop in IT spending, and a 2.3 percent increase in IT spending for 2010. Now, looking at data for more of the year, the bleeding isn't quite as bad, though it's still plenty grim. Gartner is calling for a 5.2 percent decline in IT spending for all of 2009 and an increase in IT spending of 3.3 percent for 2010.

For those of you who say, "Wait, a drop of 5.2 percent as opposed to 6 percent isn't much to get excited about," I'll say this: Absolutely true, but the trend is at least improving. Prior to this forecast, Gartner's projections just kept getting worse. They went from forecasting 5.9 percent growth for 2009 to forecasting 2.3 percent growth as the financial crisis hit to the -6 percent forecast of July. For the first time, things look slightly better than they did from one Gartner forecast to the next. We appear to have reached the abyss and taken a half-step back from it.

That said, with all the slightly improving economic forecasts, I was hoping that when Gartner rechecked all their IT spending tripwires, they'd find better figures. I was hoping we'd be looking at maybe a 3 percent drop for the year. I guess I'm too optimistic.

Other notes of interest from Gartner's latest forecast:

  • A 16.5 percent decline in hardware spending for 2009, and a flat projection for 2010. If you're into hardware, Gartner's findings indicate, start looking for other revenue sources because things aren't going to get any better any time soon.

  • IT services spending should increase 4.5 percent in 2010 from a forecast of $781 billion in worldwide spending for 2009.

  • Software spending should see a healthy swing in 2010 from a forecast decline of 2.1 percent in 2009 to growth of 4.8 percent.

Posted by Scott Bekker on October 26, 2009 at 11:58 AM


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