IDC: Companies cautious but spending on IT

The Australian IT services market currently stands contrary to global and regional expectations.

An analysis report from IDC indicates that the recession has created an opportunity for organisations to address spiraling costs and review plans on the way their business should evolve to retain a competitive edge.

The Australia IT Services Market 2009-2013 Forecas revealed that companies are spending.

However, organisations are more cautious as to where and how dollars are spent.

Marina Beale, senior market analyst for IT Services at IDC said, there is no doubt that there are price pressures and contract renegotiations as well as some delays.

Although the Australian IT services market remains a hub of activity and will continue to do so over the forecast period.

IDC states the IT environment has become increasingly complex. With the convergence of network and IT infrastructure, the inherited mix of legacy systems against newer compliance and governance standards and security concerns.

"The challenge for customers is to contain costs in running and managing this environment. Customers want to optimise, consolidate and centralise systems and applications," said Beale.

"They are looking at ways to rationalise IT support costs; revamp their networks to capitalise on the convergence of voice and data as well as turning to an array of outsourcing solutions, be it in the form of managed services, hosted services or embracing delivery models such as SaaS.

Beale said organisations are embracing newer delivery models or employing a hybrid mix of models.

The models are meant to address pain points and increase in uptake of managed services as well as a greater activity around presence of next generation networks and services.

"We are currently in a cost conscious time but that does not mean that customers are not thinking beyond this and keeping in mind more transformational projects," he said. 

The report also reveals the total spending in the IT Services market stood at approximately, $13 billion in 2008 and is predicted to grow at a five year compound annual growth rate of 4 percent over the forecast period 2009-2013.