Tech spending seen rising 6.3 % in 2006

SAN FRANCISCO - Global technology spending is expected to rise 6.3 percent in 2006, less than last year's 6.9 percent when companies picked up spending as economies improved, market researcher IDC said.

This year's expected increase comes amid economic stability in the United States, Europe and Japan and growth in emerging markets, IDC of Framingham, Massachusetts, said in a statement.

"Last year, the intensifying infrastructure upgrade cycle drove IT spending to its fastest rate of growth since Y2K," said Stephen Minton, vice president of IDC Worldwide IT Markets.

He was referring to the surge in technology spending in anticipation of feared but unfounded widespread technical problems at the turn of the millennium.

In the U.S., technology spending growth in 2006 is expected to slow to 5.8 percent from 6.4 percent last year, IDC said. The strongest increases will probably be in network equipment, outsourcing services and system infrastructure software including security tools.

Improving economies in Western Europe are expected to contribute to 6 percent technology spending growth in the region in 2006, while the Asia-Pacific region excluding Japan should have a 9 percent increase, led by double-digit gains in China and India, IDC said.