The Tech Recovery of 2010 Is Underway
As I predicted in January 2010 (see January 11, 2010, "US and Global IT Market Outlook: Q4 2009"), a tech recovery has started in the US and around the world. In my updated IT market forecast (see April 8, 2010, "US and Global IT Market Outlook: Q1 2010"), I point out that IT market indicators from Q4 2009 showed an end to declines, setting the stage for stronger growth in 2010. Since IT market trends are playing out as I expected, I have made only modest changes to my 2010 IT market forecasts. I now expect the US IT market to grow by 8.4%, a bit higher than my earlier forecast, because of better-than-expected performance in communications equipment. My forecast for the global IT market in US dollars is a bit lower at 7.7%, with the unexpected strength in the US dollar (due to the weaker Euro after the Greek debt crisis) dampening dollar-denominated growth. I continue to see computer equipment and software as the strongest product categories in 2010, with PCs, peripherals, and storage equipment leading the computer category and operating system software and applications setting the pace for software. Communications equipment purchases are looking up, especially for enterprise and SMB buying. IT services will lag a bit, with systems integration project work waiting for licensed software purchases to rise.
In this report, I provide our first look at 2010 IT purchases on an industry basis in the US. Confirming past research, the largest US industry market for tech products and services is the professional services industry ($103 billion), followed by financial services ($81 billion), and government ($71 billion). In terms of 2010 growth prospects, US manufacturers, financial services firms, utilities, and health care will see the strongest growth in 2010.
On a global geographic basis, the US and Asia/Pacific will be stand-out regions in local currency terms, while the stronger Euro and European country debt concerns will keep Western and Central Europe expanding at the slowest rate among the regions.