AllThingsD » Andrew Bartels

Econalypse Fin

John Paczkowski — Wed, 13 Jan 2010 13:45:55 +0000

“The technology downturn of 2008 and 2009 is unofficially over.”

This, according to research firm Forrester, which claims technology spending will roar back to life in 2010, ending the econalypse once and for all.

“While the Q3 2009 data for the U.S. and the global market showed continued declines in tech purchases (as we expected),” the company said in its report, U.S. and Global IT Market Outlook: Q4 2009, “we predict that the Q4 2009 data will show a small increase in buying activity, or at worst, just a small decline.”

Forrester (FORR) expects U.S. IT spending to grow by 6.6 percent in 2010 after falling 8.2 percent in 2009. Meanwhile, global IT spending, which plummeted 8.9 percent last year, will rise 8.1 percent in 2010 to more than $1.6 trillion.

Driving the recovery: Software, hardware and communications equipment. According to Forrester, worldwide spending on software is set to grow by 9.7 percent in the months ahead, spending on hardware and other computer equipment by 8.2 percent and spending on comm gear by 7.6 percent.

Said Forrester principal analyst Andrew Bartels: “All the pieces are in place for a 2010 tech spending rebound. In the U.S., the tech recovery will be much stronger than the overall economic recovery, with technology spending growing at more than twice the rate of gross domestic product this year.”

But this assumes there will be no further financial disaster in 2010. If this is not the case, then we have something else to look forward to.

“The most likely alternative to our forecast that the U.S. and global IT markets will recover in 2010 is a faltering tech market due to a double-dip recession that returns in 2010 after a brief two- to three-quarter economic recovery,” Forrester explains. “Should this happen, U.S. tech purchases would decline by 3% to 4% in 2010, with a second-half decline offsetting a first-half tech revival.”

PREVIOUSLY:

IT Spending's Role in the Economy

Lauren Goode — Fri, 13 Nov 2009 19:24:31 +0000

Efforts to reform the U.S. health-care and bank lending systems are likely to lead to an increase in information-technology spending, said one potential beneficiary, Sudhakar Ram, chairman of IT firm Mastek.

Overhauling the country’s IT systems could cost as much as $250 billion to $300 billion over five to seven years, he said in an interview. In addition, he estimated that electronic health records will cost some $150 billion to $200 billion under the Obama administration’s health-care initiatives ($20 billion of stimulus funds have already gone toward the project).

Stronger systems might have mitigated last year’s economic turmoil, Mr. Ram said. “The subprime crisis started with poor controls at the loan origination process, which a halfway decent loan-origination system should have trapped,” he said. “The core systems are several decades old and written in outdated programming languages.”

That’s like blaming superhighways for traffic jams, said Andrew Bartels, an analyst at Forrester Research (FORR) who studies tech-spending trends.

Read the rest of this post on the original site

Global IT Market: Been Down So Long It Looks Like Up to Me

John Paczkowski — Tue, 30 Jun 2009 15:40:57 +0000

First-quarter spending on information technology goods and services was worse than Forrester Research predicted at the beginning of the year. But it will grow no worse.

We’ve hit bottom. Finally.

In its latest “US and Global IT Market Outlook” report, Forrester (FORR) says information technology spending in 2009 will fall 10.6 percent in 2009. And while that’s far worse than the three percent decline the research outfit forecast at the beginning of the year, it’s also the nadir of this particular crisis, and we are at the beginning of a rebound that will gain momentum in 2010.

According to Forrester, anyway.

“While Q1 2009 saw a scary drop in purchases in the U.S. tech market, ironically that is good news for the long run and we expect to see a stronger rebound sooner,” Forrester analyst Andrew Bartels said in a statement. “The big drops are not precursors to further declines; rather, we think they are evidence of a temporary pause in U.S. tech purchases, which we expect to start recovering in Q4 as businesses realize that they overreacted in the first quarter.”

So after a year of gloom and doom, things are beginning to look up.