Corporate IT spending on the up

Soothsayers at the analyst group Piper Jaffray have consulted their tarot cards and have come to the conclusion that corporate IT spending will increase by four or five percent this year.

Of course, they claim that it is based on a survey of 69 small- and mid-cap company chief financial and chief information officers in 13 industries, but we all know that it just shuffled the cards and cut them with their left hands.

The prophets report that the results of the survey are “overall positive for the IT hardware sector,” with most respondents expecting to increase their IT spending this year.

The four to five percent figure is about the same as what Gartner reckoned and is slightly above the forecast of four percent global GDP growth. However, it is a lot less than the projected 7.6 percent growth in 2011.

In 2010, IT spending ended up increasing 5.9 percent while GDP rose 5.1 percent, which was much better than a forecast at the start of that year for just 1.3 percent IT spending growth.

There must have been some bad cards in the spread because the readers said as 2012 begins the “global economy stands at a crossroads of going from bad to worse”.

Even in a low growth environment, a technology driven world will “continue to spend to support the rapid proliferation of both data and mobile devices”.

It predicts that Intel’s Romley server chip should see a pretty broad, eager audience, with 39 percent of companies wanting to “refresh” their servers with it.

But only 15 percent of respondents said their personal computers need a refresh. In fact it looks like the corporate PC refresh business is running out of gas. Intel will do well from Romley but badly from the slow PC market.

It seems that the corporate PC upgrade cycle clocked off of Windows 7 launch in late CY09 has run out and demand for corporate PCs purchase is likely to slow in 2012.

The cards claimed that Windows 8 may be late and buggy as it is a major upgrade much like Windows Vista.