IT Spending Rates to Grow Rapidly in Media, Health Care
According to IDC’s “IT Spending by Vertical Market 2005-2009 Forecast Update,” technology expenditures could reach $1.3 trillion on a worldwide level by 2009, with nearly $500 billion of that coming from the United States alone. And while information technology spending rates in various industries are expected to increase across the board during the next few years, the two fastest-growing sectors for IT expenditures could be communications/media and health care.
The IDC report shows that compound annual growth rate (CAGR)—or the year-over-year rate of growth for an investment over a given time frame—communications and media spending on technology is expected to increase by 5.6 percent, the highest out of the 17 industries examined in the study. IDC also predicts that the CAGR of tech spending for the health care sector will rise by 5.5 percent, driven largely by the purchase of volume servers and software.
However, the largest overall IT spending markets—irrespective of growth—will be government, discrete manufacturing (i.e. production of distinct products like automobiles or computers) and banking. The rise in government technology outlays will be in IT services, driven largely by major transitions of installations from public to private operation. With regards to manufacturing, IDC experts said that the international character of production necessitated the formation of centralized enterprise resource planning (ERP) systems, which would in turn require significant investments in networking products and solutions.
Perhaps the best finding from the study, though, was that IT spending would have a healthy growth rate (in CAGR terms) in every industry over the next few years. None of the 17 sectors that IDC assessed are expected to have tech spending increases of less than 3 percent. (The last on the list was insurance, which is expected to boost its technology expenditures by 3.4 percent.)
For more information, see http://www.idc.com.