Forrester boss says industry fitter than last recession


Forrester boss says industry fitter than last recession

Paul Kunert

Amid all the doom and gloom Forrester has offered up a glimmer of hope to the channel by predicting that the length of the recession and impact on spending will pale in comparison to the years following the dot com bust.

The market watcher was quicker than most to warn of the troubles that lay ahead for the industry but CEO George Colony reckons the market is a different beast to the one that collapsed at the turn of the millennium.

"Tech will be down but not out," he said in a blog, "2001 to 2003 was a tech depression. Spending stopped, projects were cancelled [and] excess inventory flooded the market destroying pricing."

The industry had further to fall as spending was up around 12% in 2000 but from 2006 to 2007 it was up only 6%.

"When the bubble burst the fall was precipitous users of technology are far more disciplined and have cut out the nonsense. So yes, growth will slow but it won't fall off a cliff," said Colony.

Other aspects that weigh in favour of the IT industry in 2008 are the number of companies going through transformation programmes where IT is a catalyst for change and the fact that technology is ubiquitous.

"It's seven years since the last recession. Technology has become markedly more pervasive in that time - it's the air we breathe and the water we swim in tech now sits at the centre of companies' operations."

There is also a raft of technologies not present in 2001 that have been shaking up the industry over the past few years, namely virtualisation, Green IT and social and social computing.

"Will many of these projects get cut back? Yes. But many are part of long-term company plans - they will persist despite economic slowdown.

"Tech suffers when GDP growth stalls - that is always the case. But the tech environment has transitioned since the 2001-2003 hurricane - meaning that this time around will not be as severe," he concluded.

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