IT spending growth across Europe looks bleak for 2012 and 2013

As the debt crisis continues, IT spending growth across Europe looks bleak for 2012 and 2013, according to a new information and communications technology (ICT) forecast from Forrester. According to the report, Europe will see 1.2% growth in euros in European ICT purchases in 2012, shrinking the continent’s share of the market and making it distinctly smaller than that of the Americas and Asia Pacific. When measured in US dollars, the European ICT market will shrink by almost 6%, while the US and Asia Pacific will both grow by more than 6%.

The sluggish 1.2% (local currency) growth in the European ICT market will be reflected in all the tech categories except IT outsourcing and hardware maintenance and IT consulting and integration services, which will grow by 3.3% and 2.8%, respectively. Software will also see slight positive growth at 1.7% as will telecommunications services at 0.9%. Communications equipment doesn’t fare as well with a 1.7% decline. The outlook for 2013 is slightly brighter. Forrester is forecasting that software will lead the tech market with 5.5% growth, followed by IT outsourcing with 3.4% growth. However, computer equipment and communications equipment will have weak recoveries, with 3.9% and 2% growth, respectively.

Other key takeaways from the report:

  • With European countries south or west of Germany in or near recessions and even Germany, the Nordics, Switzerland, Austria, and Central Europe barely growing ― and risks of worse ― CIOs will hunker down and cut or constrain their purchases of tech goods and services in 2012.

 

  • In Greece, Italy, Portugal, and Spain, deep recessions will cause steep cuts in tech buying. In France, the Benelux countries, and the UK, near or mild recessions will lead CIOs to hold spending flat. In Germany, the Nordics, Switzerland, Austria, and Central Europe, weak but positive economic growth allows some room for cautious spending.

 

  • European CIOs will do what all CIOs do in economic downturns: cut back on capital investment and reduce their new project portfolios. However, to be competitive in the future, European CIOs should push harder to cut other areas of cost and create as much room as possible to fund new technologies of mobility, smart computing, and cloud computing.

 



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IT spending growth across Europe looks bleak for 2012 and 2013
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