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Gartner sees flat biz software biz in 2009

Forecast sinks again

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Software spending will be stagnant this year, according to market research firm Gartner, but companies should finally start loosening their purse strings after the first quarter of 2010.

This is at least the third time Gartner has lowered its forecast for world-wide enterprise software sales in 2009. Gartner now expects revenue to total $222.6bn in 2009, an increase of only 0.3 compared to 2008.

In September, the firm was predicting a 9.5 per cent increase from last year, which sunk to expecting a 6.6 per cent increase in December. (In other words, brace for June).

Gartner chalks up its freshly-lowered expectations to slower growth rates than previously expected in emerging markets, in particular Eastern Europe, which the firm's research director Fabrizio Biscotti describes as "deteriorating remarkably."

Most enterprise software segments are anticipated to have minor growth in 2009, Gartner said, but spending in some of the largest segments like operating systems, office suites, middleware, storage, and digital content creation are forecast to drop.

Gartner claims the best bets lie in software appliances, hierarchical storage management and archiving, web conferencing, and security information.

"In general, we anticipate a wave of interest around technologies that can help cost optimization," said Biscotti.

Businesses with a mix of revenue streams from channel sales, new software licenses and maintenance will fare best, the company claims. Larger sellers will have an advantage in riding out the crap economy because of their ability to offer deals on bundled software and by having a greater geographic reach.

Worldwide, enterprise software has the potential to weather the recession better than in 2001 and 2001 because the market now has more "maturity, penetration, confidence in IT, and the geographic and vertical mix." ®

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