InfoSec is a Bright Spot in IT Forecast

Technology research firm IDC sees brighter skies in its forecast for information security services outlays, with wireless and application security among the sunny spots.

Where other IT spending sectors are in a sluggish period, information security spending worldwide is expected to jump.

IDC said it expects worldwide information security services (ISS) spending to increase to more than $23.5 billion by 2007, or at a compound annual growth rate (CAGR) of 20.9 percent.

Allan Carey, program manager for information security services at IDC, said although a number of IT markets declined in spending between 2001 and 2002, security spending is still a top priority in many organizations.

“Enterprises will increasingly look for a trusted partner that can help them understand their business risks and develop an enterprisewide program to achieve a higher level of security.”

Other trends driving the increasing demand for ISS, IDC said, are the continued popularity of services that focus on improving return on investment (ROI) and helping to make security systems more manageable for IT workers.

The explosive growth of wireless data services and wireless LANs are also key growth drivers, IDC said, including applications, security assessments, architecture design, and implementation. Another key area helping to boost growth in this sector is sustained outsourcing of security strategy planning, application security testing, managed security services, and business continuity, disaster recovery, and incident preparedness.

But the firm cautioned that security service providers will have to scramble to make their wares stand out and gain passage into an enterprise client.

The outlook is one bright spot amid a cloudy forecast that IDC has issued regarding IT spending expectations within key vertical industries.

In the U.S., for example, IT spending is expected to total $372 billion this year, which represents an increase of about 1.5 percent from 2002.

Over the next five years, IDC said it expects spending to grow at a compound annual growth rate of a modest 4.9 percent to reach $467 billion by 2007.

“IT spending across the vertical industries will present a more diverse picture. While some industries are experiencing an information technology investment freeze, others are more resilient and dedicated to ongoing IT investments.”

Other key trends from IDC’s forecast: manufacturing and financial industries account for almost half of the IT opportunity; the biggest increases will be felt in the government, discrete manufacturing, and resource industries.

Overall, with its dedication to technology investment, ongoing egovernment initiatives, and homeland security issues, government will continue to exhibit positive growth throughout the forecast years, the firm said.

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