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Gartner: IT Spending Will Grow, Just Slowly

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Although financial analysts are publicly comparing the current financial crisis to the Great Depression, and it's widely expected that the IT industry will be impacted, IT vendors may weather the storm better than feared.

That's the thinking at least at industry analyst firm Gartner, which found that IT spending will only slow down -- not stop.

"In a worst-case scenario, our research indicates an IT spending increase of 2.3 percent in 2009, down from our earlier projection of 5.8 percent," Peter Sondergaard, Gartner's global head of research, said during this week's Gartner Symposium/ITxpo in Orlando, Fla.

Sondergaard said he saw IT continuing to grow thanks to a view by top management that IT can help transform their business. He also said that the fact that IT is embedded in all aspects of the business and that a shift to multiyear IT projects makes it difficult to slash spending. Sondergaard also said that IT spending decreases typically lag the economy by at least two quarters.

IT in developed economies will be worst affected, with Europe experiencing negative growth in 2009 and the U.S. and Japan seeing only flat growth, Sondergaard said.

Still, a factor that's helping to mitigate the damage is that businesses gleaned "many lessons" from the dot-com crash of 2001, Sondergaard said. "We learned that, in tumultuous times, CEOs want their executives and managers to be advisers and counselors, not just great implementers of directions given to them."

"What they want now most of all is agile leadership ... that can guide us through simultaneous cost-control and expansion," he added.

Sondergaard's remarks parallel the findings of AFCOM, a datacenter professional association, which reported that datacenter spending will hold steady and, in many cases, go up next year. The study found that enterprises believed that spending must remain because if the datacenter goes down, the business can follow suit.

Companies also will be laying down money to make their datacenters more environmentally friendly, which is seen as a way to cut costs. Going green is becoming a serious matter -- a ChangeWave Research survey in August found 35 percent of companies polled said high energy costs would cut into IT spending plans for the second half of the year.

Enterprises are also turning to cloud computing as a way to save money, with many vendors, like Dell, betting big on demand for cloud computing centers among the largest firms.