Analysts See Mixed Picture in Spending on IT Hardware, Infrastructure (
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While the worries on Wall Street and the nation's credit crunch have had the most impact on the financial sector and the banking industry, the crisis has affected the technology sector as well, and analysts are unsure how much IT departments will cut back on their purchases of desktops, notebooks, storage array and server systems in the coming year.As the U.S.
stock market continues to fluctuate and Wall
Street's biggest firms wait to see if a bailout package will arrive on their
doorsteps, there's the question of what will happen to IT budgets as credit
becomes scarce and worries mount about the overall health of the economy.
While analysts believe it is too soon to tell whether IT
budgets will be impacted by what has been happening on Wall Street since Lehman
Brothers declared bankruptcy on Sept. 15, it seems clear that there will at
least be some slowdown in spending, especially when it comes to purchases of
PCs, server systems and storage arrays. How big of an impact this will all have
is still unknown.
In a report, IDC said it believes that
the financial sector accounts for about 20 percent of all IT spending in the
United States, and that the latest calculations suggest that these firms may
cut about $3 billion in IT spending in 2009. This is likely to have an impact
on purchases of servers and PCs since it is generally easier for IT departments
to delay hardware purchases than software purchases.
Still, just because a firm such as Lehman Brothers goes into bankruptcy does
not mean it stops spending on IT. Stephen Minton, an analyst with IDC,
said large portions of Lehman Brothers still function and will continue to do
so even after they are sold to other financial companies. In that case, Minton
said, spending will continue, although IT spending and IT projects may be
consolidated or curtailed.
"When a company gets acquired or part of a company gets acquired by
another, obviously there will be certain elements of tech spending that will be
consolidated," Minton said. "Whether that means consolidating data
centers or removing how many licenses they need for software, it will have a
dampening effect on tech spending overall. As far as putting numbers around it,
it's too early."
What is important to remember as the Wall Street crisis continues is that
spending on IT has been slow since the beginning of 2008. The slowdown in
spending on Wall Street started as early as the latter part of 2007, when the
first signs of the subprime mortgage fallout began to appear. This chain of
events was factored into how IT budgets and projects for 2008 were developed
and approved, which means IT spending outside of Wall Street is likely to
continue and it could take some time before the impact of the financial
troubles of Lehman Brothers, AIG and other
companies is felt.