US Tech Market More Than Halfway Through Downturn
Cambridge, Mass., June 30, 2009 . . . Global purchases of IT goods and services by businesses and governments in 2009 are projected to decline by 10.6 percent when measured in US dollars, compared with the 3 percent decrease previously projected at the beginning of the year by Forrester Research, Inc. (Nasdaq: FORR). The latest quarterly update of Forrester’s IT spending outlook also projects a 5.1 percent decline in the US annual IT market, compared with the 3.1 percent decrease previously forecast. New data about large declines in business technology investment during the first quarter prompted Forrester to update its forecasts for technology spending. On a positive note, Forrester still expects growth in US IT investment to resume in Q4 2009, and 2010 is expected to bring a revival of IT buying in other markets as well.
“While Q1 2009 saw a scary drop in purchases in the US tech market, ironically that is good news for the long run and we expect to see a stronger rebound sooner,” said Andrew Bartels, Forrester Research vice president and principal analyst. “The big drops are not precursors to further declines; rather, we think they are evidence of a temporary pause in US tech purchases, which we expect to start recovering in Q4 as businesses realize that they overreacted in the first quarter.” He added, “We also expect that tech markets in Europe and Asia will start to recover in the first half of 2010.”
Forrester uses several metrics to determine the health and size of the US IT market quarterly and of the global IT market on an annual or as-needed basis. The data in the new Forrester forecast report focuses on IT purchasing � how much computer and communications equipment, software, IT consulting and integration services, and IT outsourcing that businesses and governments buy from technology vendors.
Looking at the 2009 global IT spending outlook by sector, Forrester anticipates lower investment than previously expected across all categories. Forrester projects purchases of computer equipment to be down by 13.5 percent, communications equipment buying to drop by 12.4 percent, software spending to decline by 8.2 percent, and purchases of IT consulting and outsourcing services to be 8.6 percent lower.
The report, “US And Global IT Market Outlook: Q2 2009,” is currently available to Forrester RoleView™ clients and can also be purchased directly at www.forrester.com/go?docid=48356. The report is based on Forrester’s analysis of data from the U.S. Department of Commerce, the Organisation for Economic Co-operation and Development (OECD), and other sources. Forrester also analyzed the financial reports of 49 large IT vendors.
About Forrester Research
Forrester Research, Inc. (Nasdaq: FORR) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, consumer insight, consulting, events, and peer-to-peer executive programs. For more than 25 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. For more information, visit www.forrester.com.