FRAMINGHAM, USA: The IDC FutureScan for December shows IT buyer expectations leveling off following November's sharp drop in response to the global financial crisis.

While IDC's outlook for IT spending over the next 12 months has not changed from the revised forecasts published in November, the FutureScan results suggest that IT buyers are now waiting to see whether the bailout measures take hold and the global economy regains its footing.

John Gantz, IDC's Chief Research Officer, says: "The good news in this month's results is that things didn't get any worse. Although FutureScan is at the lowest point in its five year history, IDC remains optimistic that IT spending will recover more quickly than it did following the 2002 downturn, when we were dealing with both the dot.com and Y2K IT purchasing bubbles. That IT spending downturn took all the slack out of the market."

The Buyer Intent metric for December was 942, which was up slightly from 936 in November. Buyer intent reflects market demand for IT products and services over the next 12 months. The market indicators number, which combines input from economic and IT industry revenue forecasts, was 941, down somewhat from the previous month's 978.

The FutureScan indicators this month point to a potential decline of more than 5.0 percent in the US. IT spending growth over the next 12 months. However, IDC forecasts that the US IT spending growth in 2009 will remain positive (0.9 percent). In addition to the user opinions and macroeconomic indicators reflected in the FutureScan results, IDC's forecast takes into account technology waves and innovations, price elasticity, and upgrade cycles that are key long-term indicators of IT spending.

Over the five year history of IDC FutureScan, the IDC forecasts have proven more accurate than user attitudes polled at any one time.

"There is a possibility that IT spending will be more deeply affected by the financial crisis than our current forecast indicates," notes Gantz. "For that to happen, economic growth will have to fall further than predicted by the IMF, UN, or Consensus Economics. Even in our downside scenario, where we had GDP growth dropping to its lowest point since 1946, the US IT spending growth would not go as negative as it did in 2002."

Source: IDC