IDC expects slow IT spending growth in Western European education sector from 2004-2009

MILAN, ITALY – December 19, 2005 – According to a new IDC study, IT spending growth will be slow in the Western European education sector. Education institutions' IT spending will grow from $9 billion in 2004 to $11.5 billion in 2009. At the beginning of the forecast period, growth of IT spending will be very limited, especially in Italy and Germany, where overall growth between 2004 and 2005 is expected to be below 1%.

IDC believes that the Western European education sector will continue to suffer because of budget cuts. For instance, the Italian Ministry for Education, University, and Research planned to contribute *184 million to the upgrade of IT infrastructures in schools in 2005, but no funds were available. However, these constraints are not felt to the same extent in every Western European country, thus initiatives are being promoted to build a network of education and community information around students and to include education institutions in national education and research networks. Mobilization of access is also an important theme, especially in higher education.

Higher education institutions will grow faster. Overall, higher education institutions are expected to grow at 5.7% between 2005 and 2009, because they have a stronger focus on higher value-added solutions, such as student management systems and elearning. Primary and secondary schools, however, will lead hardware spending growth.

According to Massimiliano Claps, program manager for IDC's European Vertical Markets, "IT vendors must provide networking equipment, portals, document management, and learning management tools to support the development of elearning and knowledge management solutions that will help primary and secondary school students to leverage on the connectivity to national education and research networks, such as JANET in the U.K."

IT vendors that want to capture a share of the revenue growth in this difficult market must take advantage of school renovation projects, especially in the U.K., and support the connectivity of schools to national education networks.

IT vendors must take advantage of school renovation projects in the U.K.

Vendors must target the U.K. Building Schools for the Future program as a potentially stable source of revenue for the next six to seven years.

Renovation and construction of new of school buildings will be particularly attractive for hardware vendors that want to sell their newest communication and server technologies, and in the second phase for software providers to implement rich elearning functionalities. Service providers must partner with consortiums that will win construction projects to offer managed services for new infrastructures.

In the study Western Europe, Education Sector, IT Spending Update, 2004-2009 (Doc #MS54M, December 2005) IDC provides an update to the Western European education IT spending forecast published last May, with latest IT spending data. On the qualitative side, the study analyzes IT adoption trends in the sector and describes major drivers and inhibitors of IT adoption. On the quantitative side, focus is on spending in hardware, packaged software, and IT services for the major European countries (France, Germany, Italy, Spain, and the U.K.) in the 2004-2009 timeframe.

IT spending is provided for the primary and secondary education, and higher education sub-industries.

To purchase this document, please contact your local IDC office or visit http://www.idc.com.

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IDC is the premier global market intelligence and advisory firm in the information technology and telecommunications industries. We analyze and predict technology trends so that our clients can make strategic, fact-based decisions on IT purchases and business strategy. Over 700 IDC analysts in 50 countries provide local expertise and insights on technology markets. Business executives and IT managers have relied for 40 years on our advice to make decisions that contribute to the success of their organizations.

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