IT spending still growing slowly

Shortage of skilled staff and senior management thinking that current kit is good enough are the biggest problems for IT managers' spending plans this year
Written by Steve Ranger, Global News Director

European companies are holding back on cutting edge technology and instead settling for "good enough" until the economic outlook brightens.

According to analysts IDC, the main obstacle to new IT spending is this growing culture of "good-enough" computing, with business leaders deciding that their existing technology can support the business and that new technology is unnecessary.

More than 60 percent of large firms interviewed by IDC said this was a bigger barrier to new projects than the weak economy, company profits or the cost of projects.

Almost two out of five large firms also said the shortage of skilled staff was another big obstacle.

Business managers in Europe are exerting considerable influence over the IT buying process, according to IDC, with the idea of retaining as much existing infrastructure as possible.

Marcel Warmerdam, director of IDC's European Black Book service, said that at the moment for many companies "good enough is good enough".

He said companies are holding back on IT spending until the end of the year to see if the economic situation gets any better.

But the survey also found that firms are still investing in IT security.

Warmerdam told ZDNet UK sister site silicon.com: "Security remains a hot topic — the threats to large and small businesses are becoming evident to everyone and not just the few."

IDC is predicting that IT spending across Europe will increase by a "lukewarm" four percent this year, down from its previous forecast of 5.6 percent.

"There is an upward trend but it is slower than expected — things are better than last year," he added.

Editorial standards