Tech spending hits the skids in 2009
The technology industry has so far weathered the downturn fairly unscathed, with netbooks buoying computer sales and online advertising holding up better than traditional media. However, Analysts now believe that the industry will see technology budgets decrease in 2009 before rebounding next year.
Forrester research predicts that the information technology goods and services sector will shrink 3 percent in 2009. This year over year drop will leave the market at $1.86 trillion this year.
Many Analysts have been predicting that technology growth would slow this year as the market stabilizes. Forrester is the first to predict an actual drop in tech budgets for the year.
While 3 percent doesn’t sound like a big loss in the market, it represents $57 million dollars in sales that will be lost this year. This could mean tough going for companies who are expecting to grow their top line this year.
One culprit in the shrinking technology market is actually a stronger dollar. While a strong dollar is good for the economy at large, it reduces the value of sales revenue from overseas. For example, Oracle’s first-ever decline was caused entirely by the reduction in value of its offshore sales in comparison to the strengthening dollar.
The biggest loss in the technology industry will be for computer equipment makers. The market for new computers is expected to drop 4 percent this year.
Telecommunications and IT services are also expected to lose 3 percent of sales for the year. Software spending is the only area expected to remain stable.
The silver lining in Forrester’s research is the outlook for the information technology sector in 2009. Next year should see 10 percent growth in the market for technology equipment and services over this year.
There’s also good news for consumers hoping to pick up the latest computer models this year. Manufacturers will need to price their products more competitively to stay ahead, offering deals for buyers.
Related Posts:
