IDC Directions Redux: Tech Industry Feels Recession’s Impact

Economic green shoots may be sprouting but the global recession will dampen the information technology industry’s prospects over the next five years, IDC Canada told attendees of its Directions conference recently.

However, the IT industry will rebound in 2010, for example, along with the economy. Tech companies though will grow slowly – most likely 1% – in 2010, IDC Canada managing director Vito Mabrucco predicted.

The hardware category will grow fastest next year by virtue of the steep expected decline this year; it has more room to grow off a lower base, Mabrucco noted.

Overall, the global IT market will grow somewhere in the 3 to 5% year range over IDC’s forecast period (2009-2013). But the Canadian IT market won’t grow in terms of absolute dollars until 2012, Mabrucco added.

Nevertheless, IT is behind only sales and manufacturing in terms of importance to top Canadian executives, according to a study done by IDC earlier this year. The strategic value of IT continues to increase for executives because it drives productivity and sales, said Mabrucco citing a study of Canada’s top executives IDC conducted earlier this year.

Other speakers during the half-day session such as Danielle Levitas, group v-p consumer broadband digital marketplace research, detailed emerging opportunities for the tech industry during the downturn. One of the notable growth opportunities, Levitas told the crowd of 140 attendees, even during a recession are social networks that can help reduce work inefficiencies in the workplace (e.g. ineffective searches, version control).

IDC conducted three breakout sessions including one on client computing, specifically emerging opportunities around personal productivity and client devices. It was an exchange between the audience and IDC hardcopy and peripherals analyst Evan Hardie, desktop and PC expert Tim Brunt, as well as yours truly. The panel discussion was moderated by veteran analyst George Bulat.

One topic of particular interest to attendees of the was the convergence of client computing devices such as cell phones and mini-notebooks. As development cycles accelerate, the functionality of cell phones resembles that of mini-notebooks and vice-versa.

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