Continued Gloom For European ICT Markets

Will it ever end? When will the European economic recession end, and when will European tech buying start to pick up? These are questions that CIOs across Europe and tech vendors selling to them into Europe continue to ask as the European recession extends into a second year in 2013 and spreads into France, the Netherlands, the UK, and even into Germany and the Nordics from its origins in Greece, Portugal, Spain, and Italy. Unfortunately for both buyers and sellers, we think the downturn will last at least through 2013, with uncertain prospects for an upturn in 2014. Indeed, tech purchases (in euros) will actually decline by 1.7% in 2013 after a slighter decline of 0.2% in 2012. We expect a modest upturn of 3.9% in 2014, though this may again prove to be too optimistic. Given this bleak outlook, CIOs need to continue to be aggressive in cutting their IT maintenance and operations spending. However, with technology still marching ahead, CIOs will have to find ways to invest in advanced mobile, analytic, and collaboration technologies to improve innovation, meet customer expectations, and keep up with competitors and growth potential.