U.S. Companies Ready to Increase IT Spending

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According to the weekly poll of 25,000 IT decision-makers in public and private organizations of all sizes, U.S. enterprises spent below their budgeted levels in 2003. In December the Gartner Technology Demand Index recorded a score of 77, which indicates that companies spent well below their allocated budget amounts for that month. An index value of 100 indicates that businesses spent the exact amount that had been budgeted for the month. In spite of this under-spending in late 2003, spending estimates for 2004 suggest strong growth in IT demand.

 

 

 

The growth will be strongest in the public sector, in technology manufacturing/communications and health services, according to analysts from Gartner.

 

 

 

All technology sectors should experience an increase in spending, but for various reasons. In the software sector, increases in spending will be driven by maintenance requirements, with a few increases for personal productivity and information management software. According to David Hankin, senior vice president and general manager at Gartner, other new spending in the software sector will be driven by vendor pressure to upgrade users to new versions and raise maintenance fees. 

 

 

 

The hardware sector will not see as much of a spending increase, but analysts expect more unit sales. Growth rates in this sector are affected by continuing price declines. Mobile connectivity devices like handhelds and notebooks will drive increased spending in this sector, with lower spending on desktop PCs and storage.

 

 

 

For more information, visit http://www.gartner.com.

 

 

Emily Hollis is managing editor for Certification Magazine. She can be reached at ehollis@certmag.com.

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