IT Spending Expectations Cool for October

Although market demand for IT products and services is expected to dip in October, a major industry analyst firm still is predicting ‘vigor’ in the IT sector.

Framingham, Mass.-based International Data Corp. (IDC) reports that a new study shows that CIOs and IT administrators are rather cool in their spending expectations for this month. But IDC maintains that the high-tech market continues to show signs of improvement.

”Both line of business executives and CIOs are more conservative in their current spending expectations than we have seen over the past few months,” says Carol Glasheen, vice president of IDC’s Quantitative Research Group. ”The summer, optimism has faded slightly and with budgeting season in full swing for many companies, we are seeing more convergence in their views of the next 12 months.”

IDC’s study focuses on Buyer Intent, which reflects market demand for IT products and services. Buyer Intent for October is 1,041, down from 1,085 in September. The Market Indicators number, which combines input from economic and IT industry supply-side indicators, increased to 1,073, up from 1,032 in September.

”One factor driving market indicators upward this month is that the stock market has recovered from its spike in March,” says Stephen Minton, vice president of Global IT Markets and Strategies with IDC. ”With worries over oil prices, Iraq, and tech sector profit warnings persistently present, the stock market has been comparatively flat over the past several months.”

FutureScan is a set of market metrics that measure supply and demand in the IT industry based on leading indicators and customer surveys. Values reflect expectations of future growth, with an index value of 1,000 indicating zero growth and each 10 points representing roughly 1 percent of expected growth or contraction.