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Forrester: IT spending in U.S. to jump 6.6 percent in 2010; Will the optimism stick?

Declaring the tech downturn history, Forrester Research came out with a rather optimistic view of IT spending in the U.S.
Written by Larry Dignan, Contributor on

Declaring the tech downturn history, Forrester Research came out with a rather optimistic view of IT spending in the U.S.

According to Forrester projections, IT spending in the U.S. will grow 6.6 percent in 2010 to $568 billion. In 2009, IT spending fell 8.2 percent. Projections for IT spending in 2010 have been moving gradually higher.

The global outlook goes like this: IT spending will grow 8.1 percent in 2010 to top $1.6 trillion. In 2009, global IT spending fell 8.9 percent.

Software and hardware will garner most of the investment as companies start a "new multi-year cycle of technology investment growth." Forrester predicts a 7-year buying cycle led by analytics. These smart computing efforts will have technologies such as service oriented architecture, virtualization and cloud computing as pillars.

Here are the projections for global spending by category in 2010:

  • Computer equipment, up 8.2 percent;
  • Communications equipment, up 7.6 percent;
  • Software spending, up 9.7 percent;
  • IT consulting and systems integration services, up 6.8 percent;
  • IT outsourcing services, up 7.1 percent.

The weak dollar will fuel IT growth in regions abroad (at least measured in the greenback). Forrester is projecting Western and Central Europe will see tech purchase rise by 11.2 percent. Canada IT spending will jump 9.9 percent in 2010 followed by Asia Pacific (up 7.8 percent) and Latin America (up 7.7 percent).

The big question: Will this projection hold?

Another survey by Wedbush Securities seems to back up what Forrester is seeing. Indeed, it appears that IT managers are becoming more optimistic.

Wedbush surveyed 110 IT managers at large companies. In a nutshell, Wedbush found the tech recovery was accelerating over time. The usual categories---virtualization, Windows 7, cloud computing and enterprise software---are getting the most attention.

The Wedbush survey has a lot of data, but the two money charts are one focused on percentage of IT projects being postponed or canceled. Respondents saying that IT projects have been frozen checked in at 38 percent in the fourth quarter of 2008. That percentage fell to 18 percent for the fourth quarter of 2009. The three quarters in between were hovering around 22 percent to 25 percent.

And here's the outlook for the year ahead by IT managers. Simply put, things are looking up.

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