Research Firm Predicts IT Spending Rebound

SAN FRANCISCO—Businesses and governments around the world are set to resume IT spending in 2010 following a dismal 2009, according to a new report from market research firm Forrester Research Inc. Global IT spending is forecast to rise 8.1 percent in 2010 to more than $1.6 trillion, following an 8.9 percent decline in 2009, according to Forrester (Cambridge, Mass.). U.S. IT spending is projected to grow 6.6 percent to $568 billion in 2010 after an 8.2 percent decline in 2009, according to the report. "The technology downturn of 2008 and 2009 is unofficially over," said Andrew Bartels, Forrester Research vice president and principal analyst, in a statement. "All the pieces are in place for a 2010 tech spending rebound." Bartels said the tech recovery in the U.S. will be much stronger than the overall economic recovery, with tech spending growing at more than twice the rate of gross domestic product in 2010. Software and computer hardware will see the greatest growth in 2010, Forrester said, predicting the start of a multi-year cycle of technology investment growth and innovation defined by smart computing. Measured in U.S. dollars, global purchases of computer equipment will be up 8.2 percent in 2010, with communications equipment buying up 7.6 percent, software spending up 9.7 percent, purchases of IT consulting and systems integration services up 6.8 percent and IT outsourcing services up 7.1 percent, according to Forrester's forecast. Forrester predicted that Europe will be the strongest growing region for IT spending this year, led by Western and Central Europe, where tech purchases will rise by 11.2 percent, boosted by the dollar's decline against the euro, Forrester said. IT purchases in Canada will grow by 9.9 percent, Asia Pacific by 7.8 percent and Latin America by 7.7 percent, the firm predicted. The weakest market will be Eastern Europe, the Middle East, and Africa, rising by just 2.4 percent, Forrester said. When measured against local currency, however, the U.S. will actually post the strongest growth of all the regional tech markets, Forrester said.