Global IT Spending to Rebound in 2010 to 2005 Levels

During the last two weeks, both Forrester Research and Gartner published reports about IT spending this year. Forrester predicts that global IT spending will increase by 8.1 percent, while Gartner predicts a 1.3 percent increase. Gartner’s 1.3 percent increase would bring global IT spending to 2005 levels after losing more than eight percent last year. Forrester’s 8.1 percent increase would bring IT spending back to 2008 levels, mostly offsetting the decrease in 2009.

Although the two firms differ on the amount of increase in global IT spending this year, they agree that IT is in a positive state of transition to more agile systems for lower initial investments than in the past, and to more focus on innovation and strategic contributions than on support and maintenance.

According to Andrew Bartels, Forrester Research vice president and principal analyst, “We are entering a new six- to seven-year cycle of IT growth and innovation that Forrester calls Smart Computing. New technologies of awareness married to advanced business intelligence analytics make computing smart. Smart Computing rests on new foundation technologies such as service-oriented architecture, server and storage virtualization, cloud computing, and unified communications. 2010 marks the beginning of this next phase of technology advancement.”

Mark McDonald, group vice president and head of research for Gartner EXP said, “Transition gives the enterprise and IT the opportunity to reposition themselves and exploit the tough corrective actions taken during the recession. CIOs see 2010 as an opportunity to accelerate IT’s transition from a support function to strategic contributor focused on innovation and competitive advantage. They have aspired to this shift for years, but economic, strategic and technological changes have only recently made it feasible. Asymmetric technologies like virtualization, cloud and Web 2.0 enable companies to get out from under a front-loaded heavy investment model that limits IT’s agility and flexibility.”

I look forward to seeing these positive transformations following such a rough economic period. I also look forward to watching IT break through some of its restraints to use innovative, best-of-class cloud-based systems that deliver rapid value such as:

The increase this year in global IT spending may only bring budgets back to levels we saw five years ago, but if all goes as well as Forrester Research and Gartner suggest, the increase in agility and innovation this year will catapult business and IT ahead of their time.

Do the Forrester Research and Gartner predictions reflect the IT budgets and priorities at your organization?