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Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

June 30, 2009 at 2:21 PM

IT decline nearly 4x worse than expected, but it’s just a “pause”

Forrester Research dramatically adjusted its forecast for IT spending in 2009, saying it now expects a 10.6 percent decline instead of the 3 percent drop it predicted at the start of the year.

That’s for the globe. In the U.S., Forrester expects a 5.1 percent decline, down from the 3.1 percent it predicted at the start of the year.

But don’t fret – it’s only a “temporary pause,” the Cambridge, Mass.-based research giant said.

Spending on technology should pick up in the fourth quarter in the U.S. – which syncs with Wall Street starting to talk about MSFT hitting $30 again – and recover in Europe and Asia in the first half of 2010, the firm said.

The press release quote from Andrew Bartels, Forrester vice president and principal analyst:

“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. 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.”

Breaking down the global decline, Forrester expects computer equipment sales to fall by 13.5 percent this year; communications equipment spending will fall 12.4 percent; software spending will fall 8.2 percent; and IT consulting and outsourcing will fall 8.6 percent.

Comments | Topics: Enterprise, enterprise, forrester

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