Economic crunch to delay foreign IT spend budgets

By siliconindia   |   Tuesday, 16 December 2008, 21:05 IST
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Bangalore: Adding more to the prevailing uncertainty in the IT industry growth, the IT budgets of the foreign clients, under the grip of the economic crunch, may be delayed. They are likely to decide on their annual IT spends only by February-March next year, while usually the budgets are finalized by December or January. "Clients have delayed their budget cycles as they are trying to figure out the impact on their businesses," says Cognizant Technologies' CFO Gordon Coburn during a recently held technology conference with Credit Suisse, reports Economic Times. Moreover, it is also felt that there will be further delay of six to nine months in deciding on IT outsourcing projects. Contemplating on the IT spends Forrester Research has again revised its forecast for 2009 by predicting a 1.6 percent annual growth, though it maintains that the market outlook is not as bad as it was during the dot com bust. While tech spend may be dropping, but Forrester says IT outsourcing will remain moderate in 2009 and 2010. IT outsourcing will get a small lift from an economic slowdown in 2008 as companies turn to vendors that can help cut IT costs. But the basic concern for the firms will be to ramp up its existing projects rather than to add more clients.

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