Optimism About Business Prospects and Economy Will Fuel IT Investments in 2004, IDC Survey Reveals

FRAMINGHAM, MA – MAY 5, 2004 – Optimism is on the rise with regard to the economic climate and the business prospects for one's organization, a new report from IDC reveals. According to IDC's latest Enterprise Technology Trends (ETT) Survey – conducted in November and December 2003 with a respondent base of 1,341 U.S. and Canadian companies – IT managers and C-level executives believe IT spending will increase 3.8% in 2004, with growth being most prevalent and strongest among professional services, retail and wholesale, and banking organizations.

"For the first time in a long time, survey respondents stated a positive outlook with regard to the economy as well as their prospects for business,” said Lucie Draper, program manager for IDC's Enterprise Technology Trends Vertical Markets group. “Organizations are also increasingly optimistic in their anticipation of improved business for the next six months. The priority remains cost control, but executives are approving IT investments that support their organizations' long-term visions and strategies in significantly greater numbers than they are investments that simply generate a quick return on investment (ROI).”

Among the key findings presented in IDC’s latest study are the following:

• Cost-cutting measures and cost control remain a top focus for more than one third of organizations in 2004. Nonetheless, for 30.8% of IT and business executives, developing and/or implementing new strategic applications to improve their organizations' competitiveness will represent the main area of IT focus during the next 12 months.

• Cost-control and cost-containment issues top the list of concerns and IT challenges, with 7 in 10 IT and business executives rating this as an extremely or very significant concern for their organization.

• Industry-specific solutions, CRM initiatives, and enterprise resource management solutions are expected to continue to drive investments in 2004.

This IDC study, 1Q04 IT Decision Monitor: Vertical Markets’ Outlook on the Economy and Their Business Prospects Shaping IT Solution Investments (IDC #31112), 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 challenges and focus areas and provides a glance at IT spending growth.

IDC's Enterprise Technology Trends research program provides analysis across 18 vertical markets and three company size segments to uncover trends and associated opportunities (or caveats). The findings presented were gathered over several distinct periods since the summer of 2001. This allows IDC to capture changes in attitudes and behaviors and to identify future trends.

For more information about IDC’s Vertical Markets Research Group, please contact Virginia Lehr at 508-935-4188 or email vlehr@idc.com.

To purchase this document, call IDC's sales hotline at 508-988-7988 or email sales@idc.com.

About IDC

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.

IDC is a subsidiary of IDG, the world’s leading technology media, research, and events company. Additional information can be found at www.idc.com.

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