Survey: IT Execs Pull Back On Spending Hikes

A new SG Cowen Securities survey shows IT spending is projected to grow 3.5% in 2004, down from 6% in a March survey.
Tech executives are pruning their IT budget plans for next year. IT spending will increase 3.5% in 2004, according to a new SG Cowen Securities Corp. survey of IS managers, CIOs, and other executives. That's down from a March survey that found businesses planned to increase next year's IT spending by 6%. Nearly half of all the surveyed companies plan no increase next year.

Virtually any increase in 2004 will be an improvement over this year, in which IT spending is now expected to grow only 0.8% over 2002. The results of the survey were released at an SG Cowen conference in Boston this week. For the rest of this year, 30% of companies surveyed have recently revised IT spending plans downward, while 24% have increased their spending plans.

Security, disaster recovery, and application-integration projects top most companies' priority lists for 2004, the survey found. Forty-three percent of those surveyed say they need more storage capacity, while 36% need more network capacity. The backlog of new applications needed also appears to be growing at many companies.

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