'CIOs expect slowdown to end by Q3'

Chennai: The economic slowdown is expected to end by Oct-Dec 2009, says a survey of 467 Chief Information Officers conducted by IDC India.

The study titled -- “Identifying Opportunities in the Current Economic Scenario” -- says the economic slowdown is accelerating enterprise transformation, which is manifested in cost savings, productivity enhancement, customer retention, and new IT engagement/delivery models

The study was conducted across 467 CIOs from mid-sized and large enterprises across 18 industry verticals in February-March 2009.

“The IDC CIO survey provides pointers to IT vendors for strategizing their business agenda in the mid-term to effectively ride out the economic slowdown and stay focused on their priorities,” Kapil Dev Singh, Country Manager, IDC India said while presenting the results of the survey.

About 66% of the CIOs felt that the slowdown would end by the fourth quarter (October-December) of 2009. However, in view of the larger macro-economic picture and the lag in terms of IT buying by enterprises, IDC India expects the slowdown to extend and IT spending to revive after the second quarter (April-June) of CY 2010.

Table 1 Duration of Economic Slowdown*

*Base: 467 CIOs Source: IDC India’s “Identifying Opportunities in the Current Economic Scenario” report (March 2009)

Companies are cutting back on new projects and focusing on the maintenance of existing IT setups, says the study.

The surveyed CIOs said that green technologies such as virtualisation, unified communications, and others such as Business Intelligence and Data Warehousing, Software-as-a-Service, and Open Source are the emerging investment priorities in 2009.

The study covered product lines ranging from access devices, networking infrastructure, software, storage, servers and technology solutions that the domestic market procures.

Table 2 Top Two CIO Investment Priorities for 2009*

*Base: 467 CIOs Source: IDC India’s “Identifying Opportunities in the Current Economic Scenario” report (March 2009)

The study concluded stating that the investments in PCs, servers and computer peripherals are expected to decrease by 20%-40% as compared to CY 2008.