IDC Report Shows Growth in Storage Spending

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The U.S. professional services industry is projected to surpass the discrete manufacturing sector as the largest overall consumer of storage technology by 2009, a new IDC study reports. IDC analysts predict both sectors will help drive spending on external storage systems up, with the overall U.S. market expected to grow to $7.6 billion by 2009.


It is important to note the difference between discrete manufacturing and process manufacturing. The former deals with production of automobiles, electronics, computers and other frequently changing commodities, while the latter consists of continuous creation of more static goods like pharmaceuticals and chemicals. The professional services industry, as defined in the IDC report, is very broad. “Professional services is a very diverse industry overall,” said Dan Corsetti, senior research analyst in vertical markets at IDC. “This includes everything from legal companies to engineering and architectural firms to consulting companies like Accenture. Because of that diversity, the storage needs of some are not the same as others.”


This field is growing rapidly as more and more U.S. companies move toward outsourcing various functions to both domestic and foreign firms, from software development to accounting to HR. “They’re doing less and less in house,” Corsetti said. “Over the forecast period, we actually have professional services projected to outgrow discrete manufacturing. By the end of the forecast, professional services will account for more storage spending in the U.S. We do see IT spending in professional services by and large growing at a faster rate than discrete manufacturing. That’s due to prevailing trends within the United States in both industries. As of right now, the reason professional services hasn’t already surpassed discrete manufacturing is that overall, it’s a slightly smaller industry.” However, the overall manufacturing sector’s (that is, both discrete and process manufacturing) storage spending will exceed $1.2 billion in the United States by 2009, while professional services spending will reach $847 million, he added.


The storage industry isn’t oblivious to these developments, Corsetti said. “There are certainly storage vendors that are looking to differentiate themselves from a vertical markets perspective. They’re targeting key markets and going after them, so that as those markets grow, they’re in a position to take advantage of that. There are plenty of storage firms out there that are targeting the health care industry in particular. With medical imaging growth, they want to be there to provide the storage system.”


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