Tech Spending Gets Bleaker

[OhioChick]

Source: The Wall Street Journal

May 13, 2008, 6:00 am

Better-than-expected quarterly results by some tech companies have some people (okay, us) asking whether tech spending has bottomed out. The answer is no, according to two new surveys of information-technology leaders that will be released today. In fact, it looks like there’s still a ways to go.

CDW, which sells tech products, surveys about 1,000 IT leaders every other month. In its previous survey, conducted in early February, a majority of small businesses (1 to 99 employees) said they would hold steady or cut back their tech spending. The majority of mid-size companies (100 to 999 employees) and large companies (1,000-plus employees) planned to increase spending.

In CDW’s most recent survey, the downturn has moved up the food chain: Forty-seven percent of mid-sized companies now plan to keep budgets flat or cut their tech spending. (In contrast, 65% of large companies still plan to increase their budgets.) Seventy-two percent of mid-sized businesses expect to stop spending on new hardware or only make minor investments, and 68% will stop spending on new software or will only make minor investments.

It would be easier to dismiss the CDW findings if a survey from ChangeWave Research didn’t reveal the< same thing. According to ChangeWave, only 12% of the nearly 2,000 IT leaders it surveyed plan to increase their software purchasing over the next 90 days, down from 16% in January and 22% in April 2007. Meanwhile, 25% of IT leaders say they’ll spend less. That’s up from 22% in January and just 10% in April 2007. ChangeWave did find one bright spot: IT leaders plan to buy more software from VMWare and Citrix, which make “virtualization” that makes tech equipment run more efficiently.[br />


Read more: http://blogs.wsj.com/biztech/2008/05/13/tech-spending-gets-bleaker/?mod=WSJBlog

[Jokerman]

1. My I.T. budget for this year was slashed by 80%.

The new position that was supposed to be created this year in my department has been cut.

Now we are under funded AND under staffed but we are expected to increase productivity.

[OhioChick]

2. They're getting rid of the sales staff

Where I'm at....we know what that means. :scared:

[AdHocSolver]

3. Could be that businesses are just not planning to upgrade to MS Vista, considering the bad rep.

Actually, IT has been in decline for the past six to seven years. Jobs are scarcer, and they ask for people with a skill set that would have been good for three or four positions a few years back. Now they want one person with a skill set to do three or four jobs.

This tactic, of course, makes it easier for corporations to complain that they can't find qualified staff to do the work, so they have to bring in IT people from India at much lower salaries.

[GetTheRightVote]

4. You are exactly right with your comments !!!

[jmowreader]

5. My IT budget went up $335,000 over the last couple of weeks

I bought two new printers, plus a compressed air dryer and a fume extractor. For that I dropped the price of a McMansion. The printers will be here in two weeks--we can't get them sooner because they're custom made.

The compressed air dryer is needed because these printers need 4 cubic feet per minute of compressed air. I'll tell you why later--right now, I don't know why. The fume extractor pulls the cyclohexanone fumes from the full-solvent ink out of the air in the room and burns them. This extractor is pretty cool--when you get enough printers, and we think we'll need ten more of these (these are Vutek printers--much faster than the Mutohs we thought we were going to buy, so we'll only need half as many), they sell you a device to put on the fume stack that generates electricity from the burning solvent. The company that makes this extractor builds fume extractors for rotogravure plants; that process puts out so much VOC that burning the fumes produces more electricity than the press draws. Today's mission was to complete the environmental impact statement for the printers. Ugh.

[area51]

6. kick. (n/t)