Global IT spending will grow in 2003

Aberdeen expects 2003 to be a modest growth year for the IT industry, following several quarters of negative or anemic growth. Our forecast is for IT spending worldwide to grow about 4% in 2003, up from less than 1% growth in 2002. This is based on our analysis of multiple data points, including global macroeconomic trends, surveys of our IT user panel, and suppliers' financial results.

We've witnessed a positive trend in year-over-year quarterly spending growth since the third quarter of 2001. However, we do not see a return to double-digit annual growth rates that we witnessed in the late 1990s and in early 2000. Instead, we forecast a more sustainable growth rate of about 4% to 5% annually through 2006. We simply do not see the compelling reasons for user organizations to spend heavily on technology - whether on new hardware or software or on upgrades to existing technology - that had existed during the years of hyper growth. Moreover, IT spending at 3.5% to 4.25% of a developed nation's economy can no longer outstrip the growth rate of the economy itself over the long term.