Infrastructure is key, resellers warned

Falling margins means a move to service business, says IDC.

To counteract declining hardware margins and a failing manufacturing sector, resellers must look to products and services that build infrastructure, analyst IDC claimed last week.

The firm estimates that the European infrastructure services market will reach $92bn (£65bn) by 2005, up from $54bn in 2000.

The company said businesses must realise that infrastructure is key to the success of a networked economy.

Lionel Lamy, research manager at IDC's European Infrastructure Management Services programme, said competition in the infrastructure market is growing quickly.

"Only the dinosaurs will survive. The market's dynamics will call for aggressive, flexible companies, but the major players will still dominate because infrastructure is too vital for corporations to gamble on," he said.