IT firms confident over private-sector funding
KPMG survey claims that channel players remain wary about public-sector spending in 2007
Despite a small drop in optimism, confidence in the IT sector is up, according to a KPMG and Intellect survey.
While the percentage of respondents who feel more confident about the general IT business outlook than they did six months ago has dipped from 63 per cent to 50 per cent, 61 per cent said they think private-sector funding will grow in 2007. However, the percentage of respondents who feel public-sector spending will grow has decreased from 61 per cent to 46 per cent in the past six months.
Also, 71 per cent of respondents agree that further convergence of telecoms, broadband and broadcast media will benefit their businesses, while 65 per cent believe that increasing uptake of open technologies and standards will have a beneficial impact.
Crispin O’Brien, head of technology for KPMG in the UK, said: “While the IT industry widely expects public-sector spending to slow from the historically high levels of recent years, the failure of private-sector investment and export sales to live up to the predictions of the last survey has resulted in this dimming of optimism.
“Whether this is a longer-term trend remains to be seen, but the immediate future looks less certain than previously.”
The KPMG survey is backed up by a similar report from the Chartered Management Institute. A survey of 648 individuals revealed that 75 per cent of senior management are optimistic for the year ahead.
Asked specifically about business prospects for their organisation over the next 12 months, 53 per cent gave an upbeat forecast.
Andy Binding, managing director of distributor Magirus, said: “I’m certainly not getting any negativity from the market. Most resellers are run by entrepreneurs, and entrepreneurs get excited when they can feel change coming down the line. Most VARs are either looking to get out or change their business. Change will stir up more excitement in the channel, and more business.”