Forrester slashes global IT outlook

Forrester Research said Monday that it is downgrading its 2008 forecast for IT purchasing in both the U.S. and around the world.

The firm is still predicting increased IT spending, but has dropped its U.S. growth projection to 2.8 per cent from 4.6 per cent, and its global forecast to six per cent from nine percent.

Andrew Bartels, vice-president at Forrester, said in a statement that the forecast is based on the assumption a mild recession will hit the U.S. economy in the second or third quarter.

Forrester is pegging the global market for IT spending in 2008 at US$1.7 trillion, and said IT purchasing grew at 12 per cent globally worldwide and 6.2 per cent in the U.S. during 2007.

Region to region, the 2008 outlook varies, according to Forrester.

Growth in central and western Europe will stand at 5 per cent this year, the company said. That is a substantial drop from 2007’s 15 per cent growth rate, but Forrester noted that the dollar’s weakness against the euro helped drive that performance.

Meanwhile, Eastern Europe, the Middle East and Africa are set for a strong year, according to Forrester. Oil-producing nations like Russia and Saudi Arabia will see 12 per cent growth in 2008, just a slight drop from last year.

The Asia-Pacific region will also see strong growth at nine percent, but that figure represents a drop from the 15 per cent rate posted in 2007, Forrester said.

Meanwhile, the U.S.’s overall share of global IT spending is still falling, dropping this year to 33 per cent, Forrester said. That percentage stood at 40 per cent in 2003, according to Forrester. The U.S. still has a healthy stake in software purchasing, however, with a 44 per cent share of the worldwide market, the analyst firm said.

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Jim Love, Chief Content Officer, IT World Canada

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