(EMAILWIRE.COM, August 06, 2002 ) Firms will spend 2.3 percent more on IT in 2002 than in 2001, and 82 percent of these firms will at least retain their current budgets over the second half of the year, according to Forrester Research (Nasdaq: FORR). Forrester's semiannual Business Technographics North America Benchmark Study examines the state of North American companies' IT budgets, purchase plans, and control of IT processes.

"Although IT budgets have stopped bleeding, it's still a harsh buyer's market for tech vendors," said Tom Pohlmann, senior analyst at Forrester. "In areas like IT outsourcing and enterprise apps, a vendor's best hope is to squeeze incremental business out of its installed base of customers."

In Forrester's previous Business Technographics Benchmark Study -- the Business Technographics February 2002 North America Benchmark Study -- Forrester found that IT and business execs were risk-averse and shifted their IT strategies toward infrastructure and do-it-yourself development and integration work. Key findings from the August 2002 report reveal new trends and a cautiously optimistic outlook on IT spending during the second half of the year.

On average, IT spending in 2002 is 2.3 percent higher than 2001. IT spending in consumer services and retail will grow by more than 7 percent, while high-tech firms and utilities lead the decliners.
Nineteen percent of the companies surveyed will raise IT budgets over the second half of 2002 -- only 12 percent will cut them. Of those raising budgets, 37 percent will raise them by more than 10 percent.
C-level sentiments are on the mend. Fifty-five percent of respondents describe their executives as willing to "spend what it takes" on IT. As a point of reference, only 36 percent felt that way at the beginning of the year.
More companies have centralized IT management. Fifty-eight percent of Global 3,500 companies (firms with annual revenues of $1 billion or more) characterize their IT organizations as heavily centralized, compared with only 17 percent of Global 3,500 companies at the beginning of 2001.
The midmarket isn't a growth opportunity for vendors. While midmarket firms (firms with annual revenues less than $1 billion) are more likely to increase budgets, they're also less likely to buy any of the technologies covered in the report, with the exception of ERP software.
Technologies and services covered in the Business Technographics August 2002 North America Benchmark Study include:

Server hardware, network hardware, storage hardware
IT consulting services, IT outsourcing services
CRM software, ERP software, content management software, business intelligence software
Web services technology
Enterprise portal products
EAI technology
Internet connectivity
To read a Quick View of this report, please visit: http://www.forrester.com/ER/Research/DataOverview/0,2740,14595,00.html

"Executive commitment to IT is returning, and interest in categories like IT consulting and storage are showing more life," adds Pohlmann. "But vendors must know where to look. Specialized, smaller-scale offerings will carry the services market, while data dissemination products like portals and business intelligence apps carry the software market." Later this month, Forrester will be publishing a series of Tech Spending Profiles based on panel data from Forrester's August 2002 North America Benchmark Study. The new research product is available semi-annually (in January and June), following the release of each Benchmark Study. Each Tech Spending Profile comes with a tool that enables technology executives to benchmark their IT spending and planning efforts against a peer group of companies. Technology vendors will find this product useful as they finalize marketing and sales planning for 2003.

The Forrester Tech Spending Profiles will include analysis and data on spending, budgets, and rollout plans, as well as a qualitative overview of general attitudes and behavior specific to 10 unique industry groups. They include:

Business services
Chemicals and petroleum
Consumer services
Distribution
Financial services
Finished goods manufacturing
High-tech
Insurance
Retail
Utilities
Methodology

For Forrester's Business Technographics August 2002 North America Benchmark Survey, Forrester surveyed 1,001 senior business and technology decision-makers at North American companies with annual revenues of $500 million or more.

Forrester Research is a leading emerging-technology research firm providing data and analysis that defines the impact of technology change on business. Forrester's WholeView™ Research, Strategic Services, and Events help Global 3,500 clients understand how technology change affects their customers, strategy, and technology investment. Established in 1983, Forrester is headquartered in Cambridge, Mass. For additional information, visit http://www.forrester.com.

©2002, Forrester Research, Inc. All rights reserved. Forrester, Forrester eResearch, Forrester Wave, WholeView, Technographics, TechStrategy, and TechRankings are trademarks of Forrester Research, Inc.

---------------

Produced for Forrester Research

Contact:

Tina Murphy
Manager, Public Relations
Forrester Research, Inc.
617-613-6032
press@forrester.com

---------------

Contact Information:
Forrester Research, Inc.
Joseph Nchor
Tel:
Email us


This is a press release. Press release distribution and press release services by EmailWire.Com: http://www.emailwire.com/us-press-release-distribution.php.