Forrester has just published its annual European Tech Market Outlook (see "At Last, A Tech Market Recovery In Europe"), and we are projecting modest growth of 2.3% in euros in 2014 for European business and government purchases of technology goods and services, with an acceleration to 4.9% in 2015. There are some bright spots in the European tech market:
- Spending on technology that supports customer facing processes (e.g,, customer relationship management, marketing automation, mobile applications, eCommerce solutions, Web content management, etc.) will rise by over 10% as firms put priorities on technologies that help them directly win, serve, and retain more empowered customers;
- Spending on software in general will rise by 4%, with spending on applications outpacing spending on middleware.
- Tablets will be the one segment of hardware that will post robust growth.
- The UK, Sweden, and the Benelux countries will have the best growth.
However, most European countries — including the larger Euro economies of Germany, Italy, and Spain — will see tech market growth in the 1% to 2% range in 2014, with the French tech market barely growing. Similarly, spending on computer equipment (apart from tablets), communications equipment, IT outsourcing, and telecommunications will be in the same range. The problem is that the Eurozone countries, while at least pulling out of recessions, are still experiencing feeble economic growth. That will leave European CIOs being very cautious and conservative in their tech purchases in 2014. Not until 2015, when we assume that economic growth will start to solidify, will European tech markets return to healthier rates of expansion and growth.