Economic uncertainty has resulted in a mixed outlook among IT decision-makers according to the latest CDW IT Monitor. While confidence is on an uptick and spending is showing small gains, budget recovery has been slow.
Budget expectations among IT decision-makers held steady through most of the latter half of 2010 until December of 2010 when there was a six percentage point drop. The recent CDW IT Monitor shows that budget recovery has been slow in some sectors but improving in others. However, the Six Month Growth Outlook, an index calculated from a number of survey questions related to spending, staffing expectations as well as hardware and software procurements, increased one point year over year, to 68.
While budget outlooks are more cautious, CIOs still expect to make key IT investments in the second half of the year. The outlook for software spending has shifted to the greatest expectations on record for new software installations for a significant part of organizations. Two out of five IT decision-makers expect to do so, up six percentage points year over year and four points above the previous record set in the fourth quarter of 2010. In addition, three out of four IT decision-makers expect to purchase new hardware in the next six months. This is seven percentage points above this time last year. Spending on mobility is effectively equal to that of desktops, with IT decision-makers expecting to purchase 66 percent and 67 percent of mobile devices versus desktops respectively in June.
Virtualization (59 percent), security (58 percent) and cloud computing (56 percent) lead June solutions spending considerations among IT decision-makers with cloud computing making the biggest jump, up nine points from April. As cloud computing, virtualization and mobile computing become more prevalent, 48 percent of IT decision-makers see security as a greater priority than it has been in the previous two years with internal threats as the greatest concern.
While 43 percent of IT decision-makers expect an increase in the overall IT budget in the second half of 2011, this level of budget optimism is five percentage points below June of 2010. In particular, the budget forecast among large business and the federal government is weaker than this time last year, down 10 and 17 percentage points respectively.
The bright spots are medium-size businesses and state governments, which show a more favorable budget outlook. Of medium-size business decision-makers, 59 percent expect increases, up four percentage points year over year. Among state governments, 32 percent expect increases. While two percentage points down from June 2010, the state government reading is eight percentage points above April figures.
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