Western European Vertical Markets to Reach Value of Just Over $406.5 Billion in 2010, Says IDC

MILAN – FEBRUARY 23, 2007 – According to a new IDC study, companies across Western European vertical markets will continue to invest in IT at a compound annual growth rate of 4.3% between 2006 and 2010, reaching a value of just over $406.5 billion in 2010. Software is expected to be the fastest growing segment, closely followed by IT services (driven by operations and planning), while hardware is expected to register weak growth throughout the forecast period.

While 2006 growth has been revised down slightly, manufacturing remains the largest revenue opportunity for IT vendors, accounting for nearly 22% of total IT spending. Best opportunities appear in the discrete manufacturing subsegment, which is expected to grow at a 3.9% annual compound rate for 2006 to 2010. IT spending in retail is expected to grow at 5.4% in 2006 to 2007 (slightly above 1Q06 forecasts), with stronger opportunities in the U.K., Spain, and Italy.

The best opportunities at a vertical level continue to be found in public sector organizations, particularly the local government and healthcare segments where IT spending is still influenced by the streamlining of services delivery. However, the education sector is expected to continue to lag. Opportunities are also expected to arise in manufacturing, retail, business services, and transport/communications/utilities.

"Western European companies' attitude towards IT spending remains rather cautious. Nonetheless, improved economic conditions, reflected by increased business confidence, are expected to moderately impact IT spending, which appears to be gradually recovering," said Nina Bonagura, senior research analyst with IDC's European Vertical Markets. "This is especially true for stable and expanding economies such as the U.K. and Spain, though the overall impact is positive across the whole region."

This IDC study, Western European Information Technology Vertical Markets' Spending, Forecast Update, 2005-2010 (Doc #M51N, January 2007) provides new data and analysis for Western European IT spending trends by vertical market for 2005 to 2010 and follows up on Western Europe Information Technology Vertical Markets IT Spending, Forecast 2005-2010 (Doc #M01N, July 2006). Data is consistent with IDC's third-quarter Black Book and the studies provide more information on IT spending estimates and forecasts by vertical market and country and for total Western Europe.

To purchase these documents, please contact your local IDC office or visit www.idc.com

IDC's eGovernment Conference 2007, taking place on April 12 at the Dusseldorf Hilton, will highlight solutions that will enable public administrations of all levels (federal, state, and municipal) to optimize administrative processes, foster cross-administrative cooperation, save costs, and help create improved client relations. For more information please contact Matthias Remberg, Conference Director, IDC Central Europe, tel: +49-69-90502-106, email: mremberg@idc.com .

About IDC

IDC is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. More than 900 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 90 countries worldwide. For more than 43 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com .

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