IDC Survey of 18 Vertical Markets Finds Restrained Optimism for Business Prospects in 2003

FRAMINGHAM, MA – APRIL 8, 2003 – IDC’s latest survey of North American businesses in 18 vertical industries indicates that, although the short-term economic outlook is improving, businesses are tempering their enthusiasm. When asked about their business prospects in 2003, these same organizations responded similarly restrained optimism.


Although attitudes about the economic and business outlook do not directly point to an upturn in technology spending, these attitudes do help gauge the tone of an industry. IDC research reveals that the average IT budget growth rate for 2003 across North American organizations will be 3.2%, driven by increases among mid-market companies. Large variations exist across industry segments, but the following trends provide an overall view of the situation and expectations for 2003:

North American organizations in the aggregate spent 5% of their revenue or operational budget on IT in 2002. This share is expected to grow in 2003, reflecting diminished revenues for some industries and budget cuts impacting areas other than IT more severely.

Over three-quarters of surveyed companies ranked "Exploit our existing markets more efficiently" as their number 1 business priority for the next 12 months and 79.4% stated that total IT spending in 2003 will stay the same or increase in comparison to 2002.

Top priority areas for IT investments in 2003 most often include CRM, systems infrastructure, and industry-specific solutions.

"The current economic uncertainty is clearly felt in our survey findings," said Lucie Draper, program manager for IDC's Enterprise Technology Trends, Vertical Markets group. “For a majority of organizations, the strongest decision criterion in evaluating and justifying IT investments is that the project will contribute to lowering costs and expenses. IT expenditures are now perceived as ‘project driven’ rather than ‘budget driven,’ and those projects that are considered critical to remain competitive and cost effective will continue to be implemented, despite the economy.”

Although the focus on IT spending was on systems infrastructure and security solutions in 2002, this year CRM solution vendors are poised to see the biggest gains, IDC’s research shows. However, many companies made significant technology purchases over the last two tothree years and are now trying to put it all to work and provide the return on investment sought.

The end-user data presented in this study, IT Decision Monitor 1Q03:

Vertical Markets' Economic Outlook and Business Prospects Shaping IT Budgets and Investment Priorities, (IDC #28918), derives from IDC's Enterprise Technology Trends (ETT) research program. The research provides analysis across 18 vertical markets and three company size segments and offers a look at ways in which the economic climate affects perceptions of business prospects and how the outlook is changing over time. It offers detailed information on IT budgets and budget directions for 2003 and provides a glance at past, present, andfuture IT solution investment areas and top IT investment priorities.

Findings presented were gathered over three distinct periods:

May/June 2001, December 2001/January 2002, and September/October 2002. This allows IDC to capture the change in attitudes and behaviors. Quarterly updates will be developed.

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For additional information about IDC’s Enterprise Technology Trends research, please contact Virginia Lehr at 508-935-4188 or email at

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC’s customers comprise the world’s leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at

IDC is a division of IDG, the world’s leading IT media, research, and exposition company.


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