IT Spending Ready for Strong Rebound in 2010, Forrester Says

After a difficult two years, including a sharp decline of 8.2 percent in the United States and 8.9 percent worldwide in 2009, IT spending is poised for a strong rebound, said industry analyst company Forrester Research.

According to a report released Jan. 12, worldwide IT spending in 2010 should increase 6.6 percent in the United States to $568 billion and 8.9 percent globally to more than $1.6 trillion, Forrester analysts said.

In the United States, technology will see a faster recovery than other sectors of the economy, according to Andrew Bartels, a Forrester principal analyst.

"The technology downturn of 2008 and 2009 is unofficially over," Bartels said in a statement. "All the pieces are in place for a 2010 tech spending rebound. In the United States, the tech recovery will be much stronger than the overall economic recovery, with technology spending growing at more than twice the rate of gross domestic product this year."

The trend toward what Forrester calls Smart Computing—in which more aware technology is combined with advanced analytics, and which includes such solutions as virtualization, cloud computing and unified communications, all bringing greater intelligence to computing—will be a key driver in the spending rebound, particularly in the areas of computer hardware and software.

Smart Computing will kick off a six- or seven-year cycle of IT growth, investment and innovation, according to Bartels.

"Smart Computing rests on new foundation technologies such as [SOA] service-oriented architecture, server and storage virtualization, cloud computing, and unified communications," he said. "2010 marks the beginning of this next phase of [technological] advancement."

Forrester expects that global purchases of software will jump 9.7 percent in 2010, accompanied by an 8.2 percent increase in spending on computer equipment, a 7.6 percent increase in spending on communications equipment and a 6.8 percent increase in spending on IT consulting and system integration services.

Spending on IT outsourcing services is expected to grow 7.1 percent.

Regionally, Forrester predicts that Western and Central Europe will see an 11.2 percent rise in technology purchases, with IT purchases in Canada jumping 9.9 percent.

Asia Pacific should see a 7.8 percent increase, and Latin America a 7.7 percent increase. The weakest market is expected to be Eastern Europe, the Middle East and Africa, growing only 2.4 percent.