UK tech spending set to beat inflation

National Computing Centre research claims 58 percent of UK companies will increase their IT spending above the rate of inflation in 2008
Written by Tim Ferguson, Contributor

Technology spending in the UK is likely to increase at a quicker rate than inflation over the next 12 months, despite an uncertain economic climate.

According to research by the National Computing Centre (NCC), around 58 percent of companies will make inflation-busting increases to what they spend on IT.

The median growth rate for IT spending is predicted to be 4.9 percent, with the highest growth likely to be seen in the construction and health sectors.

NCC managing director Stefan Foster said the results of the survey suggest technology buyers are confident about future economics but are not being overly optimistic.

The NCC suggested Microsoft is likely to be one of the big winners, as companies look to refresh their desktop infrastructure, replacing Windows XP with Windows Vista.

XP currently dominates the marketplace with 71 percent of the businesses surveyed using it but, in two years' time, Vista is likely to make up around 75 percent of the market, according to the research.

Desktops may become less popular, with a 57 percent increase in the number of laptops and a 134 percent increase in the number of PDAs predicted over the next two years. According to the research, the number of desktops is set to fall by around two percent.

Companies are also looking to invest heavily in virtualisation, storage area networks and VoIP. Meanwhile the increasing popularity of the IT Infrastructure Library (Itil) is likely to fuel spending on business-process management apps.

Gartner recently recommended that companies start cutting technology costs in order to protect themselves from a predicted global recession.

The NCC's Benchmark of IT Spending 2008 survey included responses from 120 organisations, with a combined IT spend of more than £750m.

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