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Global information technology spending in 2010 will grow 9.3 per cent, led by computer equipment and software segments, according to Forrester Research. In the US, which is the primary market for Indian IT services firms, IT spending is expected to grow 8.4 per cent.The numbers given by Forrester Research are more optimistic than similar forecasts by agencies like Gartner which has given a 5.3 per cent growth expectation.
In a teleconference with Indian media, Andrew Bartels, vice-president and principal analyst at Forrester said that three factors, economic conditions, technology cycles and exchange rates of currencies have driven the very positive forecast.
A 9.3 per cent growth will see global IT spending touch USD1,534 billion, with the US market accounting for one-third of it. This is expected to grow a further 8.5 per cent to USD1,664 billion in 2011, spurred by smart computing.
Bartels said that on a global geographic basis, the US and Asia Pacific will be stand-out regions in local currency terms, while the stronger Euro and European country debt concerns will keep western and central Europe expanding at the slowest rate among the regions.
In segments, software category is expected to be the biggest contributor to IT spending with USD392 billion, while IT services will reach USD276 billion and IT outsourcing USD171 billion in 2010.
Growth in software is good news for companies who are into system integration (SI) since it is directly tied to development and licensing of software, said Bartels. He expects SI and IT consulting to grow positively, even for Indian vendors, in the second half of the year. Incidentally, about 20-25 per cent of the work that Indian IT services majors do is in SI.
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