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Technology: IT Budget Growth Estimates Revised Downward
While many IT budgets remain huge, a majority of analysts and economists are now adjusting IT spending forecasts downward over the next year. The US Federal budget currently comes in at around $80 billion, and Peter Sondergaard, Senior Vice President of Gartner Research, recently reported at Gartner ITxpo conference in Orlando, reported that there are now 350 corporations in the world with IT budgets exceeding $1 billion IT. But IT budgets of both large and small companies are poised to shrink the rest of this year and into 2012.
For example, within the Federal Government, the US Deparment of the Navy announced in August that it plans to cut IT spending by 25 percent over the next five years, and other federal agencies like Social Security are also planning cuts to their IT budgets. Tech suppliers Dell, Brocade, and Juniper Networks are cutting their revenue estimates for the remainder of the year. Dell is talking of a “a more uncertain demand environment.”
Gartner is cutting back on its IT annual growth estimates for 2012 from the previous estimate of 5 percent annual growth to just 3 percent.
Jim Finkle of Reuters quotes Forrester Research analyst Andrew Bartels as saying that “we could go into an economic recession and see tech spending decline.”
Rebecca Wettemann, vice president and analyst with technology research firm Nucleus Research said that companies are “putting more scrutiny on spending. They are looking at cutting back.”
