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SINGAPORE : Companies are expected to spend less on information technology as they seek to cut costs amid the global economic slowdown.
IT consultancy group Gartner has lowered its forecast for growth in global IT spending from 5.8 per cent to as low as 2.3 per cent next year. This is 5 percentage points lower than the growth forecast for this year.
However, IT spending is expected to pick up again in 2010, with Gartner forecasting global growth at 5.6 per cent.
Meanwhile, Gartner said businesses should also study ways to improve their efficiency in the current difficult environment.
Office workers in the region should not expect the latest software upgrades and new technology as firms cut back on IT spending in the face of the slowing global economy.
Gartner expects businesses around the world to cut costs further through measures such as delaying the replacement of hardware. But essential IT spending, such as critical infrastructure projects, is expected to stay on track.
Matthew Boon, managing vice president, Gartner, said: "We looked at our original forecast which came out in the September time frame, and realised at that point there had been some significant shifts in core markets such as financial services.
"And it was clear over the next six to seven months there was going to be some declines in expenditure in core geographies. As a result, we found it prudent to reassess our overall IT spending forecast."
Gartner said it is important for companies to think about where they need to invest, and not just focus on cutting costs straight away. It said modernising IT infrastructure is key.
Gartner recommends technologies such as virtualisation, which allow firms to combine different resources on to a single platform. This will allow them to provide better and more efficient services to customers.
Gartner said it is also important for vendors to relay to businesses the importance of IT infrastructure in improving their competitiveness.
Mr Boon said: "Any organisation with a major sort of consumer customer base, for example, will certainly be looking at ways that they can retain customers. Some companies we have talked to are looking at some emerging or emerged technology to help them, from an investment point of view."
IT spending in the Asia-Pacific region is expected to see one of the highest growth rates globally.
Gartner said emerging giants like China will remain a key investment location for many vendors. Countries such as Vietnam, Pakistan, Indonesia and the Philippines are also expected to ramp up their IT capabilities in the next few years. - CNA/ms
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