IDC FUTURESCAN
is a collection of metrics of IT industry leading indicators and customer
surveys. Values are based on expectations of future growth, with a value
of 1000 equating to zero growth and each 10 points representing roughly
1% of expected growth.
These are external indicators only and don't represent IDC's
forecast for the market, which is based on many more inputs and which
relies on strict methodologies and market definitions.
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This Month's Results
Another stable month, if you consider negative expectations for the economy and IT spending that are about the same as last month stable.
So far the rhetoric about the potential turnaround coming on the part of some administration officials is not matched by our data. We still haven't hit bottom, but we seem to be floating down, not plummeting.
IDC's new forecast for IT spending the next 12 months is lower than last quarter, but, at exactly zero growth, ahead of both FutureScan indicators.
Basically, the IT community is numb. A few high growth markets, lots of slow growth markets. Some companies making investments, many more hunkering down.
But soon, the penalty for putting off projects or upgrades will begin to increase – conventional wisdom says, for instance, that maintaining a 4-year-old PC for a year costs as much as buying a new one.
And don't forget the stimulus money … coming soon to an IT buyer near you!
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History
Good news here.
One, the buyer sentiment seems to have bottomed out (unfortunately, still below zero) and, two, for the third month in a row the macroeconomic indicator has gone up.
The red line is purely survey based and measures buyer opinions. The blue line is driven by macroeconomic trends and vendor revenue forecasts. Our interpretation of the red line is that the rate of decline in expectations has flattened out. The blue line is now a battle between a rising stock market (from its low) and falling forecasts for vendor revenues.
It would be nice, though to get at least one of these indicators above 1000, a number not seen since October 2008.
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Buyer Intent
History: |
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"Same old, same old," as they say. General expectation malaise has set in to replace the panic of six months ago. Companies have made the initial cutbacks and are figuring out how to do more with less.
For CIOs, this is a challenge, since while we are in the midst of an economic crisis we are also in the midst of a technology renaissance. Web 2.0, business analytics, mobile computing, virtualization, cloud computing. The new technology presents what one wag once called and insurmountable wall of opportunity.
For most companies, IT spending is a lagging indicator of financial health. For those most adept at wielding technology, it is a leading indicator. For how can you grow revenues, cut costs, make customers happier, or rush new products to market without IT?
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Market
Indicators History |
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The rising macroeconomic indicators are heartening, but less so when you realize that the stock market component is now comparing the current S&P 500 to the period after the big crash in October. But still it's higher than it was six months ago.
The vendor forecasts are up a tad but still negative, and now we have the reverse exchange rate problem we had last year. With the dollar rising, revenue growth reported by multinationals is dampened by currency effects. A year ago, the dollar was falling. So demand it actually probably growing faster than revenues.
As for the other components, the GDP and profit forecasts for 2009 keep trending down, but 2010 is staying firm. And in positive territory.
All told, we're not too bad this month.
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The Buyer Intent metric is based on surveys of 400-500
U.S. CIOs and line-of-business executives on their expectations
for IT spending growth during the next 12 months. Results
are carefully weighted to be representative of the U.S.
market. These surveys are conducted monthly by the Quantitative
Research Group (QRG) within IDC's Global Research Organization.
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The Market Indicator metric combines inputs from economic
and IT industry supply-side indicators including:
- The stock market (S&P 500 over last 6 months)
- Current interest rates
- The current GDP forecast for the next 12 months
- The current US corporate profit forecast (next 12 months)
- The IDC IT Revenue Forecaster (% revenue growth expected
next 2 quarters)
IDC combines and weights the inputs using information
developed in its Leading IT Indicators program on the
relationship of macroeconomic trends to IT spending.
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IDC FUTURESCAN is a collection of metrics of IT industry leading indicators
and customer surveys. Values are based on expectations of future
growth, with a value of 1000 equating to zero growth and each
10 points representing roughly 1% of expected growth.
These are external indicators only and don't represent
IDC's forecast for the market, which is based on many
more inputs and which relies on strict methodologies and market
definitions.
For more information about any of IDC's Black Books or other
GRO products, please contact Amie White at awhite@idc.com
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