IT spending and services
have proved resilient in the current contagion of economic woes. But the immunity period appears to be over for some CIOs, according to new research from Forrester Research Inc.
| More on IT spending, budgets |
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| Gartner: IT services spending remains strongGartner: Worsening economy puts dent in some U.S. IT budgets2008 is budget balancing act for CIOs |
In a survey of more than 950 IT senior executives at large businesses, 43% told Forrester they have already cut their overall 2008 budgets due to the economic slowdown. Twenty-four percent of those surveyed said they have cut discretionary spending; 28% said current conditions have had no impact on their budgets.
Still, spending on IT services -- a category that has held up well globally according to other forecasts -- holds fast.
Only 16% of those surveyed told Forrester they have already cut spending on IT services. While the great majority are taking a hard line with suppliers -- 70% said they plan to renegotiate contracts for lower rates -- they 'are still expecting to pay more for services,' said John McCarthy, principal analyst at Cambridge, Mass.-based Forrester.
The survey of IT executives across North America and Europe was taken during the second quarter.
Not surprisingly, the polling shows that some firms are getting beat up more than others.
'This is not an across-the-board spending slowdown; the impact of the economy on IT budgets varies widely by industry and geography,' said McCarthy, on the polling data.
| This is not an across-the-board spending slowdown; the impact on the economy on IT budgets varies widely by industry and geography. John McCarthy principal analystForrester Research Inc. | |||||
| This is not an across-the-board spending slowdown; the impact on the economy on IT budgets varies widely by industry and geography. John McCarthy principal analystForrester Research Inc. | ||||||
Hardest hit are financial firms (49% have cut IT budgets). Least affected are businesses in media, entertainment and leisure (39% reported budget cuts). When the survey was taken, North American CIOs were under more pressure to cut costs than their European counterparts; Forrester says that may no longer be true, however, as weak economic conditions have infected other parts of the globe.