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IT SECTOR
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Global IT industry stronger than in 2003
Research by U.S. investment bank Goldman Sachs showed
that, as in the previous year, the information technology (IT)
industry lacked impetus worldwide in 2004. Goldman Sachs
estimates that in 2004 hardware and software spending was 3%
to 4% higher than in 2003, failing to keep pace with the increase
in global GDP but improving on the previous year’s 1% to 2%
IT spending growth (also a Goldman Sachs estimate).
According to market researcher Gartner, western
Europe company budgets for IT services were only 0.3 % higher
than in 2003. Market intelligence specialist IDC believes
IT budgets grew 1.5% in Germany. On the other hand, in late
November 2004 the German Association for Information
Technology, Telecommunications, and New Media (BITKOM)
issued results of a membership survey pointing to an increase
in IT spending in Germany of 2.5 %.
IT sales were rather livelier in Asia-Pacific than in
Europe, in line with the generally more encouraging economic
trend in that region. Gartner estimates that IT spending in
Asia-Pacific increased 12 % in 2004. But at 10 %, growth in Japan
was weaker than in the rest of the region. Gartner calculates
that the United States’ IT spending grew 4% in 2004.
Toward the end of 2004, the revenue outlook for IT
companies began to improve. However, postponed investments
from previous quarters were not yet released. Moreover,
Oracle’s prolonged efforts to acquire competitor PeopleSoft
brought turbulence to the business software arena. AMR
Research and Gartner both found that the resultant uncertainty
harmed the entire industry – companies were reluctant
to spend while confusion reigned about the future of products.
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