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August 28, 2009

European IT Market Outlook:
2009 To 2010
by Andrew H. Bartels and Peter O’Neill
for Vendor Strategy Professionals

Making Leaders Successful Every Day

For Vendor Strategy Professionals
Includes a market sizing forecast and data from Business Data Services

August 28, 2009
European IT Market Outlook: 2009 To 2010
The European Recession Hurts IT Purchases
by Andrew H. Bartels and Peter O’Neill
with Ellen Daley, Heidi Lo, and Chétina Muteba

Executive S u mma ry
The European market for business-purchased technology goods and services (measured in euros) will
decline by 6.3% in 2009, and be slow to recover in 2010 with only 4% growth. In both regards, it will lag
behind the US tech market, which will have a smaller drop in 2009 and stronger growth in 2010. The main
reason? The European economic recession has turned out to be deeper than the US recession, with
Europe’s downturn starting later and probably lasting into 2010. All categories of IT purchases will be down,
with computer equipment and communications equipment being especially weak. The UK, Germany, and
France continue to be the largest European IT markets, with a 55% share of the European market. The UK,
Spain, Ireland, Iceland, and Central European countries will have worse performance than Europe as a
whole, and no European country will avoid a down year. For IT vendors, other markets — especially the
US, but also Asia/Pacific — will present better opportunities in 2009 through 2010 than Europe.

tab l e of Contents N OT E S & R E S O URC E S
2 European IT Market Will Drop In 2009 And Lag Forrester reviewed country tech investment
Behind US IT Market data from the Organization for Economic
7 Behind The Forecast: Weak Indicators For Cooperation and Development as well as data
2009 European IT Purchases from 46 vendors, including Accenture, ACS,
Alcatel-Lucent, Atos Origin, Avaya, BearingPoint,
10 European IT Purchases By Country: Economic
Growth Drives IT Market Growth Capgemini, Cisco Systems, Computer Associates,
CSC, Dell, EDS, EMC, Ericsson, Fujitsu, Getronics,
recommendations
Hewlett-Packard, Hitachi, IBM, Infosys
21 Focus In 2009 on Specific Country Technologies, Lenovo, Microsoft, Motorola, NEC,
Opportunities For Different Products Nokia, Nortel Networks, Oracle, SAP, Siemens
alternative view SBS, Sun Microsystems, Symantec, T-Systems,
22 European IT Purchases In 2009 Turn Out to Be Tata Consultancy Services, Unisys, and Wipro.
Flat Or Just Down A Little
23 Supplemental Material Related Research Documents
“US And Global IT Market Outlook: Q2 2009”
June 29, 2009
“Global IT Market Outlook: 2009”
January 12, 2009
“European IT 2008 Market Outlook”
March 6, 2008

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1%. growth in purchases by European businesses and governments of computer equipment. and other countries had their own housing bubbles that burst.0% in Europe (in euros) (see Figure 1-1). However. the European IT market grew at about the same rate as the US IT market. and consulting and outsourcing services in 2009. the decline in US dollars will be less. -5.8% decline in US real GDP projected for 2009 is not as bad as the drop in the European economy. Middle East. many European banks turned out to be exposed to toxic securities and Central European debt. and outsourcing services has been and still is lagging behind the US tech market. 2009 © 2009. IT purchases in Western and Central European countries will shrink by 6. but the 2. communications equipment. The deeper decline in the European IT market is mostly due to the deeper recession that Europe is experiencing. Reproduction Prohibited . with projected growth of 8% (in US dollars) compared with 4. Ireland. Europe had its own vulnerabilities. While the US IT market will also fall in 2009. Declines In European Economic Growth Mean Reduction In IT Purchases We project that the countries of Western and Central Europe will purchase €297 billion (US$402 billion) of computer equipment. Measured in euros. software.1 The US economy is also in recession. communications equipment.2 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals EUROPEAN IT MARKET WILL DROP In 2009 And Lag Behind US IT Market From 2005 through 2007. IT consulting and integration. while the European economy will show no growth (see Figure 1-2). While the main cause of the US downturn was the financial crisis from the collapse of the housing bubble and subprime mortgages and a resulting downturn in consumer spending and business investment. August 28. following a decline of 0. Spain. even though the European economy remains about 20% larger than the US economy (see Figure 2). in 2008. and Asia dried up.8% in 2008. The UK. software.3% in 2009. and export-oriented European economies like Germany and Scandinavia have suffered as their exports to the US.9% in 2010. Moreover. Inc.2 The US IT market will be about one-third bigger. The US IT market will also have a stronger recovery in 2010. at €390 billion (US$526 billion). Forrester Research. The Organization for Economic Co-operation and Development (OECD) projects that the collective real GDP of the euro-zone countries of Europe (measured in euros) will decline by 4.8% in 2009. and especially in 2009. Europe will be slower to recover than the US — according to OECD projections. the US real GDP will grow by 0.

Forrester Research. Latvia. Inc. Portugal. for IT purchases estimates and forecasts. 46672 Source: Forrester Research. Norway. 2009 . Greece. © 2009. Sweden. Netherlands.. Germany. Hungary. France. for GDP estimates and forecasts. and UK. Forrester Research. Poland. Luxembourg. Slovakia. Finland. Estonia. Switzerland. Ireland. Slovenia. Inc. Cyprus. Italy. Belgium. Czech Republic. Lithuania. *Forrester forecast † Austria. Reproduction Prohibited August 28. Iceland. Inc. Inc. Malta. Spain. European IT Market Outlook: 2009 To 2010 3 For Vendor Strategy Professionals Figure 1 Deeper Recession Than In US Will Cause Steep Decline In European IT Market 1-1 2009 European IT purchases will drop more than US IT purchases Growth in IT purchases of goods and services in local currencies 8% United States 5% in US dollars Western and Central 2% Europe in euros† -1% -4% -7% 2004 2005 2006 2007 2008 2009* 2010* 1-2 The European recession will be deeper than that in the US Growth in real GDP in local currencies 4% 3% United States in US dollars 2% Western and Central 1% Europe in euros† 0% -1% -2% -3% -4% -5% 2004 2005 2006 2007 2008 OECD OECD forecast forecast 2009 2010 Source: OECD and Forrester Research.

7% Western and Central Europe* 6. Slovenia.9% -4.5 €10. Forrester Research for IT purchases estimates and forecasts *Austria.4 €10. Italy. Sweden. Slovakia.0 €12. Belgium. Hungary. Germany.4 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 2 Measured In Dollars Or Euros.1% 7. Luxembourg. Lithuania. The European IT Market Lags Behind The US IT Market A spreadsheet with additional data is available online. Reproduction Prohibited . Cyprus. Spain.0% -0. Poland. Portugal.0% 2-2 Growth in European IT purchases in dollars is much stronger in 2007 and 2008 20% 15% United States IT purchases of 10% Western and Central goods and services 5% Europe* (percentage change 0% from prior year -5% in US$ billions) -10% -15% 2-3 Western and Central European GDP is greater than US GDP in euros United States Western and Central Europe* €11. Latvia. France.8% 3. Switzerland.1 €10.8 €13. 2009 © 2009. Netherlands. Malta.5% 11. 2-1 European IT purchases in euros is still smaller than US IT purchases United States Western and Central Europe* €403 €396 €390 €435 €377 €298 €319 €317 €296 €309 IT purchases of goods and services (euros billions) % change from prior year 2006 2007 2008 2009† 2010† United States 6.6% -1. Inc.3 €10. Forrester Research. August 28.8 €9.0 €12.3% 4. Finland.1 €12. † Forrester forecast 46672 Source: Forrester Research. Czech Republic. Inc. Norway. Estonia. and the UK. Iceland. Ireland. Denmark.7 Nominal GDP (euros billions) 2006 2007 2008 2009† 2010† Source: OECD and Forrester Research for GDP estimates and forecasts. Greece.8% -6.

By category. · Software purchases will fall by 5. pulling levels of investment down by 9.2%).5% growth. we expect: · Computer equipment purchases will be down in 2009 and lag in 2010. and CIO tendencies to cut back these kinds of capital investments in a downturn will combine to keep computer equipment on the slow track.7% in 2009.8% in 2009. lower price points as vendors cut rates.6%). Project work will revive in 2010 with the return to software investment. and IT outsourcing (-5. © 2009. Total software purchases will shrink from €72 billion in 2008 to €68 billion in 2009.4% in 2010. Software (-5. IT outsourcing is suffering as much as — if not more than — IT consulting and systems integration services. but bounce back in 2010 with 5. These categories of IT services will decrease from €57 billion in 2008 to €54 billion in 2009. respectively. License software revenues will bear the brunt of decline. security.2% to €57 billion in 2009 from €63 billion in 2008. Oracle’s European application license revenues in US dollars were down 12% and 11%. IT consulting and integration services (-4. and grow by only 1.7%) will decline a bit less than computer equipment (-6. Adoption of server virtualization software. · IT outsourcing services purchases will decline by 5. As in the US.2%). and a revival of insourcing as European companies with full-time staff commitments bring back in house IT activities that had been outsourced (see Figure 3). With Software Leading A 2010 Upturn Sad to say. due to higher rate of adoption of cell phones in Europe and 3G cellular systems. Inc. Forrester Research. but systems integration and application integration project work will decline in line with (but lagging) the decline in licensed application software purchases.4%). there are no real bright spots in 2009 in the different categories of tech purchases in Europe. Reproduction Prohibited August 28. and by 11% or more in US dollars.4% in 2009. The outlook turns brighter for 2010. and SAP’s application license revenues on a comparable basis were down 38% (-29% in euros). 2009 . going from €83 billion in 2008 to €78 billion in 2009 and €79 billion in 2010. but all will fall by 4% or more in euros. However.3 · IT consulting and systems integration services purchases will drop by 4. This category of IT purchases has done relatively well in recent years compared with the growth in other categories. Consulting services for IT strategy. Purchases of computer equipment will drop by 6. For example. in the first two calendar quarters of 2009. lower-cost netbooks. before rising by 4% to €60 billion in 2010. or communications equipment (-9.2% in 2009. the recession is hurting this category of capital investment in 2009. and SOA systems design will hold up relatively well. European IT Market Outlook: 2009 To 2010 5 For Vendor Strategy Professionals All Categories Of Tech Face Sharp Declines In 2009. · Communications equipment purchases will drop in 2009 and creep back in 2010. The weaknesses in European IT outsourcing are due to shifts to smaller-scale outsourcing projects. with software purchases setting the pace with a 5. business process change.5% growth.

3% -2.4% 7.5% -16.0% Software 9.6 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 3 All Categories Of European IT Purchases Will Fall In 2009 3-1 Western and Central European IT purchases forecast in billions of euros Computers and peripheral equipment € 319 € 317 € 309 Communications equipment € 298 € 297 Software € 85 € 83 € 79 € 80 € 78 IT consulting and systems integration services € 59 € 63 € 63 € 57 € 60 IT outsourcing € 64 € 71 € 72 € 68 € 72 € 55 € 57 € 57 € 54 € 57 € 41 € 42 € 42 € 39 € 41 % change from prior year 2006 2007 2008 2009* 2010* Computers and peripheral equip.4% 16.9% integration services IT outsourcing 3. Inc.0% -14.2% 4.3% 7.2% 0.3% 4.9% -12.5% Software 10.5% 7.5% -13. August 28. Forrester Research.0% IT consulting and systems 3.0% 4.4% integration services IT outsourcing 3.6% 6. 7.1% -9.6% 13.0% 4.8% 0.40 (numbers have been rounded) *Forrester forecast 46672 Source: Forrester Research.6% 13.4% Communications equipment 10.0% -13. 2009 © 2009.5% -5.2% Total 6.7% Communications equipment 11.0% 3-2 Western and Central European IT purchases forecast in US$ billions Computers and peripheral equipment Communications equipment $466 $438 $432 Software $123 $402 $375 $117 IT consulting and systems $106 $111 integration services $100 $86 $93 $83 IT outsourcing $78 $74 $98 $106 $100 $81 $92 $69 $79 $84 $74 $80 $51 $58 $61 $53 $58 % change from prior year 2006 2007 2008 2009* 2010* Computers and peripheral equip.4% 5.1% 5.47 $1.7% Total 7.0% 4. Inc.6% 6.6% 1.36 $1.1% 21.9% 9. Reproduction Prohibited .1% -1. 6.2% 16.7% 5.8% -6.4% US$ per euro $1.0% -1.5% 11.2% -4.3% 17.3% -5.8% 7.37 $1.0% -0.1% -11.7% 7.2% 4.8% 8.8% 6.7% 7.2% 8.7% 6.2% -6.26 $1.5% IT consulting and systems 3.

Forrester Research. we expect: 14% decline in dollar-denominated purchases of computer equipment in 2009. with the worse-than-expected European recession causing firms to cut their actual IT spending even further (see Figure 4). and will probably drop by 5% in Q2 2009. and -18% in Q1 2009. -11% in Q4 2008. Similarly. and a 12% fall in IT services and outsourcing. while flat to down slightly so far. with similar rates of decline for the rest of 2009. The outlook gets worse in the second half.8%. as CIOs start reflecting the worse economic outlook of the first half of the year in their second half purchase plans. as well as declines in vendor revenues from the larger EMEA market coming into 2009.5% and their IT capital budgets by 2. -5% in Q4) and Q1 2009 (-7%). but will fall by Q4 2009. We expect that vendors’ European revenues will fall by 6% in Q3 2009 and by 2% in Q4 2009. In practice. slid further to a 6% decline in Q1 2009. and Africa (EMEA). Measured in US dollars. EMEA Revenues For IT Vendors Grew Weakly In 2007 Forrester tracks the quarterly revenues of 49 leading IT vendors in Europe. Germany.4 BeHind The ForeCast: Weak Indicators For 2009 European IT Purchases Our forecast of sharp declines in IT purchases in Europe is made against a backdrop of planned IT budget cuts in Europe. 16% drops in purchases of communications equipment. European IT Market Outlook: 2009 To 2010 7 For Vendor Strategy Professionals Measured in US dollars — which matters for US vendors — the European market picture is even bleaker. with declines of -10% in Q3 2008. with the dollar expected to resume its decline against the euro in © 2009. Software vendor revenues in Europe held up better. These revenues in euros fell each quarter in 2008 at -1% to -3%. planning to cut their 2009 IT operating budgets by 6. On average across these three countries. but the declines will accelerate in the remainder of 2009. will deteriorate by Q4 2009 (see Figure 5-1). Inc. when all earnings are announced. the Middle East. Reproduction Prohibited August 28. a 13% decline in software purchases. European CIOs Are Cutting Their 2009 IT Budgets By 3% Or More Forrester surveyed IT decision-makers in France. Communications equipment vendor revenues fell more moderately in late 2008 (-3% in Q3. French and German enterprises said that they would cut their IT operating and capital budgets by between 1.2% and 1.9%. IT consulting and outsourcing services. With the US dollar despite recent weakness still well above its value against the euro in the first half of 2008. UK enterprises were the most cautious.8%. the pattern of deterioration in vendors’ European revenues is similar but worse through Q3 2009. 2009 . we expect that most European countries will spend even less than their reduced IT budgets. However. Computer equipment vendor revenues have already been in sharp decline since Q3 2008. the IT decision-makers at the enterprises we surveyed reported that they planned to cut their IT operating budgets by 3.2% and their IT capital budgets by 1. remaining slightly positive through Q1 2009 and probably into Q2 2009. with -13% in Q3 2009 and -17% in Q4 2009. and the UK between February and May 2009 about their planned 2009 IT budget increases.

communications equipment.5% -1.5% Planned increase in IT -2.8 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals the second half of 2009. With Actual Cuts Even Deeper “By what percentage do you estimate your IT operating budget and IT capital budget will change in 2009?” Three largest European IT markets -1.8% France in IT purchases in 2009† -2. Q2 2009 † Forrester forecast for how much IT purchases (capital investment plus expensed purchases of computer equipment. though.2% Germany -2. Inc.4% Planned increase in IT capital budgets in 2009* -1. based on the data provided in this report. Figure 4 European Enterprises Plan To Cut IT Budgets In 2009. Western Europe is usually considered more mature while much more growth is budgeted for Eastern Europe and the Middle East.8% Average -3. This enables them to apply the most suitable sales approach and management expectations to each target market. software. Most multinational IT vendors or service providers have already segmented their EMEA territories into “stable” or more mature geographic markets and “emerging” or growth markets.7% Base: 487 German IT budget decision-makers. 365 UK IT budget decision-makers.8% Actual likely increase -1. UK in pounds sterling *Responses to Forrester’s Enterprise And SMB Global IT Budgets And Spending Survey. 46672 Source: Forrester Research. Reproduction Prohibited .9% UK operating budgets in 2009* -5. 2009 © 2009. Forrester Research.2% -1. Q2 2009 Note: Germany and France in euros. August 28. and IT consulting and outsourcing services) will actually grow during the year.9% -3.9% -6. Inc. dollar-denominated declines in vendor European revenues will actually be less in Q4 2009 than the euro-denominated declines (see Figure 5-2). Strategy professionals may need to review these decisions. and 467 French IT budget decision-makers Source: Enterprise And SMB Global IT Budgets And Spending Survey.

9 € 19.4 € 7.4 € 9.4 € 7. Reproduction Prohibited August 28.3 € 7. Inc.4 € 9.3 € 7.8 € 8.6 % change from prior year Q3 2008 Q4 2008 Q1 2009 Q2 2009* Q3 2009* Q4 2009* Computers and peripheral equip. global IT vendors 46672 Source: Forrester Research.8 € 8. Inc.6 Software € 43. -10% -11% -18% -11% -12% -15% Communications equipment -3% -5% -7% -9% -13% -17% Software 3% 5% 4% 3% 3% -8% IT services and outsourcing -2% 0% -3% -4% -3% -9% Total -3% -2% -6% -5% -6% -12% (numbers have been rounded) Base: 49 large.6 € 11. 2009 .3 € 7.6 € 42.3 € 7.4 € 17.5 € 8.0 € 7.5 € 9.7 € 17.5 € 8.4 € 8.3 € 17. with similar drops ahead in Q2 and Q3 2009 Total vendor revenues (€ billions) Computers and peripheral equipment Communications equipment € 48. Forrester Research.0 € 40.3 € 17.8 IT services and outsourcing € 8. 5-1 IT vendor revenues from EMEA in euros fell by 6% in Q1 2009.3 € 17. European IT Market Outlook: 2009 To 2010 9 For Vendor Strategy Professionals Figure 5 IT Vendors’ EMEA Revenues Started 2009 In Negative Territory A spreadsheet with additional data is available online.8 € 41.6 € 8. © 2009.9 € 41.

Forrester Research. this recession and divergent policy reactions to it have shown that Europe is still a collection of 28 different countries.0 $11. global IT vendors (numbers have been rounded) Source: 49 large global IT vendors’ 2008 and 2009 quarterly financial reports *Forrester forecast 46672 Source: Forrester Research.4 $10.6 $10.7 $11.51 $1. -1% -19% -28% -23% -21% 9% Communications equipment 6% -14% -19% -21% -22% -12% Software 13% -5% -9% -10% -7% 0% IT services and outsourcing 8% -9% -15% -17% -12% -2% Total 6% -11% -18% -18% -15% -5% US$ per euro $1.7 $14.8 $9. And each of the European countries have different degrees of dependence on exports. Inc. One result is a wide divergence among the countries of Western and Central Europe.10 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 5 IT Vendors’ EMEA Revenues Started 2009 In Negative Territory (Cont.7 $55.) 5-2 IT vendors’ EMEA revenues falling more rapidly as dollar strengthened Computers and peripheral equipment Quarterly rates (US$ billions) Communications equipment Software $65. While all countries in Western and Central Europe will experience a decline in real GDP in 2009.2 $11.5 $23.2 $23.0 $14.40 Base: 49 large.36 $1. different experiences of housing bubbles and collapses.35 $1.6 $9.7 $56. with each country pursuing its own economic policies (within the limits set for the Euro-bloc countries by the European Central Bank’s monetary policy).5 $64.7 $11. roles for central governments in the economy. different labor policies.6 $11.6 $23.6 $53.1 $11.0 % change from prior year Q3 2008 Q4 2008 Q1 2009 Q2 2009* Q3 2009* Q4 2009* Computers and peripheral equip.9 $9. Reproduction Prohibited .1 $60.7 IT services and outsourcing $12.7 $25.5 The European Union itself has had no coordinated policy for fighting the recession.2 $12.9 $10. and different exposure to financial market strains. 2009 © 2009.9 $11.31 $1.9 $25. and Poland will have relatively mild downturns (based on OECD August 28.4 $26. Inc.6 $13.32 $1. some countries like Greece. European IT Purchases By Country: Economic Growth Drives IT Market Growth While Western and Central Europe have some of the institutions and trappings of being a single political and economic entity. Norway.

and Ireland are experiencing actual deflation. Forrester Research.1%. Italy. with commensurate growth rates in nominal GDP. Hungary. Extensive research that we have done in the US and in other countries shows that the growth in nominal GDP is the best single predictor of growth in business and government purchases of technology goods and services. For example. Poland. Tech-intensiveness causes some countries to drop sharply and rebound equally. and Iceland have more serious inflation problems (mostly due to depreciation of their currencies against the euro). The economic environment matters to the tech market because economic growth is one of the three factors that we use to forecast the growth rate in the tech markets of different European countries. Nominal GDP growth is a key determinant. Germany. and Lithuania will see much more painful downturns of 7% or more. The three key variables that drive our forecasts for tech purchases in each of the European country markets are: 1. The financial institutions. Germany. tech investment is down more than their declines in nominal GDP would imply. and the Baltics have rescued troubled financial institutions. In our January 2009 Global IT Market Outlook. 3. both the US and Canada are experiencing similar recessions.2%. even those that have had to be rescued by governments. Sweden. Latvia.5%. and the Baltic states of Estonia. we use growth in nominal GDP as one of the key variables in our forecast model for predicting IT purchases at the country level. the UK.5%. we identified 12 countries that used technology more intensively relative to GDP than other countries. However. and 4.9%.3% and 4. Reproduction Prohibited August 28. The result is that US companies are hoarding cash and slashing capital investment — including tech capital investment — while Canadian companies are simply cutting back on investment. Iceland. Ireland. Financial market strain is a second key factor shaping the tech market. Inc. Germany. Other countries like Iceland. Sweden. As a result. and Ireland have had similar financial market collapses to that of the US. not the inflation-adjusted world of real GDP. However. Six of the countries in this “tech 12” group © 2009. On the other hand. and the Netherlands face the biggest declines of 6. The UK and Spanish economies will drop by 4. while the US financial market is still under strain from collapses of Bear Stearns and Lehman Brothers and the forced rescues of others. In most European countries. thanks to inflation rates of 1% to 2%. while Belgium. Of the major European economies. European IT Market Outlook: 2009 To 2010 11 For Vendor Strategy Professionals forecasts). 5. so their nominal GDP growth is quite a bit better than their real GDP growth rates (see Figure 6-2). 2. 5. Norway.6 Why? Because Canada has a normally functioning banking system. because IT buyers and IT vendors operate in a world of current or nominal values. making nominal GDP even lower than real GDP. respectively. However. the US tech market has dropped far more than the Canadian IT market. In Europe. nominal GDP declines are slightly less than real GDP declines. This recession is unique among post-war downturns in the degree to which a collapse of functioning financial markets has direct business investment in technology. are also hoarding cash — or at least credit extensions — and this in an additional inhibitor to capital investments.7% declines in real GDP (see Figure 6-1). 2009 . France and Switzerland will experience 3% and 2.

6-1 Ireland.2% 1.1% 0. June 2009 46672 Source: Forrester Research.7% -0.3% 0.4% Hungary* -6.0% -3.0% 0.5% Czech Republic* -4.4% Lithuania* -10.8% -1.5% Sweden* -5. and all others in euros. Slovakia in korunas. Iceland.7% 1.0% Other Western and -1.3% Ireland -9. Figure 6 Many European Countries Will See Declines In Real GDP Of 4% Or More In 2009 A spreadsheet with additional data is available online. the Netherlands.0% Iceland* -7.1% -1.12 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals were European countries: Denmark.3% 2009† Austria -0.8% Portugal -4.1% Greece -1.6% Denmark* -4.0% 2010† Norway* 0. Finland.8% Estonia* -10. Slovenia in tolars.5% -0. Switzerland.0% France -3. and the UK.4% Spain -4.2% UK* -4. August 28.2% 3.9% -0.5% 0. Hungary in Forints.5% 0.0% 0.5% Finland -4.0% Latvia* -12.4% 0. Inc. Inc.1% -2.2% Italy -5.2% Belgium -4. Czech Republic in korunas. Denmark in krone. Norway in krone.1% -0.0% -0.0% -0.0% 3.0% -2. Iceland in krone. Estonia in kroons. 2009 © 2009. Latvia in lats.4% Switzerland* -2.7% 0. Switzerland in Swiss francs.3% 0. Lithuania in litas.2% Slovakia* -5. and Baltics will have biggest declines Real GDP Growth Germany -6. † OECD Forecast.2% -0. Poland in zlotys.3% Total Western and Central Europe in euros* *UK in pounds sterling.0% -1.0% -0.2% -4. with big cutbacks in the downturn but also bigger rebounds in the upswings (see Figure 7).9% Netherlands -4.4% Luxembourg -4.2% Central Europe* -4.1% Slovenia* -2. Sweden. The IT markets in these countries will tend to behave similarly to that in the US. Sweden in krone.8% Poland* -0. Reproduction Prohibited . Forrester Research.

3% Europe in euros Source: Organization for Economic Co-operation And Development. April 2009 46672 Source: Forrester Research.6% 0.7% Hungary* -3.8% 1. Iceland in krone.9% 2. Switzerland in Swiss francs.7% Total Western and Central -6.” (http://www.5% Greece 0.0% Latvia* -12.1% 2. Inc.3% 2.0% Austria -2.8% 0.4% 1.6% 2008† Netherlands -3. Czech Republic in korunas.8% 0.9% -3.1% Denmark* -2. European IT Market Outlook: 2009 To 2010 13 For Vendor Strategy Professionals Figure 6 Many European Countries Will See Declines In Real GDP Of 4% Or More In 2009 (Cont. © 2009. and all others in euros.6% Slovenia* -2.9% 0.7% Lithuania* -2.3% -2.xls) *UK in pounds sterling.0% 0.2% Luxembourg -4.8% Estonia* -15.oecd.org/dataoecd/18/26/2713584.8% Italy -3.5% Poland* 2.6% 0.1% 3.2% 2. June 2009.5% Switzerland* -2. Latvia in lats.0% 0.1% 2.7% UK* -2.6% Slovakia* -6. Lithuania in litas.1% 0.3% 2.9% France -2.9% Norway* -2.0% 1. Reproduction Prohibited August 28. Slovenia in tolars.) 6-2 Nominal GDP growth will increase by 4% Nominal GDP Growth Germany -4.5% Ireland -9. Forrester Research.1% Other Western and 1.4% 0.2% Belgium -3. “OECD Economic Outlook 85 Projection.2% 2. † IMF forecast. 2009 . Slovakia in korunas.0% -1. Poland in zlotys. Sweden in krone.2% Portugal -4.6% Finland -4. Inc.9% Iceland* 2.7% Czech Republic* 0. summary of projections.5% -3. Denmark in krone.5% 2007† Spain -0.2% Sweden* -3.2% 0.2% Central Europe* 3.1% 4. Norway in krone.9% -5. Estonia in kroons. Hungary in Forints.

3.5% and the UK Tier 2: Average for Denmark. Luxembourg. Reproduction Prohibited . and Spain 2. 2008.5% Sweden United Kingdom 3.5% and Iceland 1. Finland. Sweden. “Investment Data and Shares of ICT Investment in GDP and Total Non-residential GFCF. Forrester Research.0% United States Tier 1: Average for Belgium.5% 0. 2009 © 2009.5% Business and government investment in technology as a percentage of GDP 4.0% the Netherlands.5% Switzerland Netherlands 2.5% Spain France 1. and Switzerland Tier 3: Average for Austria. Inc. Belgium. 1. France. Portugal.0% 1991 1995 2000 2005 2010* 7-2 European countries ranked by their 2008 ratio of technology investment to GDP A spreadsheet with additional data is available online.0% 0. Inc. Forrester estimates for 2005 to 2008 and forecasts for 2009 to 2010 *Forrester forecast 46672 Source: Forrester Research.0% Finland Greece 1.14 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 7 Four Tiers Of European Countries In Their Tech-Intensiveness 7-1 The UK.0% Ireland 1991 1995 2000 2005 2010* Source: OECD. Greece.” January 8. 2. and Sweden come closest to US levels of tech investment relative to GDP 4.0% Tier 4A: Average for Ireland and Italy Tier 4B: Central Europe.5% Germany Italy 0.0% Business and government investment in technology as a percentage of GDP 3. 3.5% Germany. 4. August 28.0% Belgium Denmark 2.0% Portugal Austria 0.

respectively. with some markets down by as much as 32% to 35%. The UK market for IT goods and services measured in euros will drop by 12% in 2009 to €57. The IT markets in Poland and Iceland when measured in euros will drop by 26% and 30%. and the Netherlands constitute about 22% of the European IT market. while Belgium will fall by 6% to €8. the UK. Measured in euros. down 3% from 2008. · Spain. and Belgium make up about 12% of the European IT market. In their own currencies. · The dollar’s strength causes dollar-denominated declines to be much greater. The German IT market at €57. with the Czech Republic falling by 20%. Switzerland. Reproduction Prohibited August 28. and Norway. Greece.8 billion. Each will have about €7 to €12 billion of IT purchases in 2009. Slovenia. With The UK Market Down The Most What does the breakout of IT purchases look like by countries? · Germany. · Measured in their own currencies. Denmark and Norway will fall by 3%. Finland. financial market strains add to weak economies. 2009 . and France represent 55% of the European IT market. Italy. Inc. and Luxembourg will decline by lesser amounts (see Figure 8).5 billion will fall by a more modest 3% in 2009. France remains the third largest IT market in Europe at €49. Lithuania by 17%. the Swedish market down 6%.4 billion.7 billion. and Estonia by 10% to 13%. IT markets in Austria. the UK IT market will slip into second place behind Germany in 2009. European IT Market Outlook: 2009 To 2010 15 For Vendor Strategy Professionals The UK. Hungary by 21%. · Sweden. Slovakia. Sweden. © 2009. Germany. the UK market will be down 5% in 2009. the UK. and the Swiss market down 5%. while Denmark at €7. And France Dominate.4 billion in 2009. The Netherlands and Italy will drop by 4% measured in euros while Spain’s IT market will shrink by 6%. Switzerland at €11. Sweden will drop by 16% to €9. Forrester Research. Denmark. but the central European IT markets will slip by 8% to 10%. before reclaiming its lead position in 2010. and others do better. Portugal. These three countries will have between €27 billion and €18 billion of IT purchases in 2009. In both cases. As a result of the cutbacks in UK tech purchases due to the UK recession and financial crisis. · The other 18 countries make up 10% of the European IT market. the US values for IT purchases in almost all European markets will be at least 7% lower in 2009 than in 2008. Latvia by 19%. With the US dollar so far in 2009 remaining well above its exchange rates with all European currencies in most of 2008.2 billion will see a small decrease of 2%. Switzerland. Ireland.7 billion will see a 1% decline. all in line with the drops in their nominal GDP.

5 -10. Inc.2% 5% *Forrester forecast 46672 Source: Forrester Research. The UK. Germany. though Norway makes it into the top 10 markets instead of Austria. Total IT purchases % change from prior year (billions of euros.3% 2% Denmark € 6.3% 4% Hungary € 0. while Denmark. Most countries will have rates of decline in purchases of this category that are between 2% and 5% measured in euros.2% 3% Czech Republic € 1.16 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 8 The UK.2% 6% Sweden € 8. or actual increases (see Figure 9).9 1.9% 5% Italy € 24.9% 8% Slovakia € 0. August 28. Forrester Research.8% 7% Austria € 5.5 -12.2 -4.9% 2% UK € 44. 2009 © 2009. Inc. Greece. 2009 forecast) 2009* 2010* Germany € 49. no declines. and Finland will have small declines. European Computer Equipment Purchases Will Shrink By 7% In 2009 The ranking of the country markets for computer equipment in Western and Central Europe follows that of overall IT purchases.3 -13. Norway.1% 2% Belgium € 8.7% 6% Ireland € 1.8 -6.1% 4% France € 43. And France Are Largest European IT Markets A spreadsheet with additional data is available online.0% 5% Portugal € 2.2 -20. Reproduction Prohibited . Poland.4 -11.1% 3% Netherlands € 15.4 -2. Belgium and Ireland will have the biggest declines.5 -1.2 -1.2 -4.3% 2% Spain € 18.8 -2. Sweden.5 -16.9% 3% Greece € 4.5 -4.0 -2.7 -20. Among the euro-zone countries.8% 7% Switzerland € 10.3% 3% Norway € 4.5 -7.5% 0% Finland € 4.8% 5% Poland € 1. and the other central European countries make double-digit rates of decline measured in euros because of the strength of the euro against their currencies.4 -6.9 -26.

Sweden.9 -11% 4% Poland € 0.2 -1% 1% Greece € 1. and Greece will see lesser drops.1 -18% 5% *Forrester forecast 46672 Source: Forrester Research. Reproduction Prohibited August 28.6 -9% -4% Finland€ 0. and France have the four largest markets. Spain.6 -22% 12% Austria € 2. 2009 .7 -11% -1% France € 8.0 -4% 1% Czech Republic € 0. Italy. The UK. Germany. Greece has been investing in communications equipment to support both broadband Internet service and expanding wireless services.4 8% -5% Portugal € 1.5 -7% 6% Sweden € 2. Belgium. and Ireland among the euro countries will see declines in purchases of 8% or more in 2009. businesses spend much less on computer equipment than they do on communications equipment. while Germany. Spain.8 0% 5% Ireland € 0.4 -2% 1% Italy € 6. and many of the Central European countries will have declines measured in euros of 20% or more. Italy. and in Finland thanks to the influence of Nokia on Finnish IT habits.5 -5% -1% Spain € 5. Inc.9 -3% 11% Switzerland € 2.3 -4% 0% Netherlands € 4. Austria. Inc. Computer equipment purchases % change from prior year (billions of euros.2 -4% 2% Belgium € 4. and Germany and Italy having the top two positions. France.8 -4% -1% UK € 15. European Purchases Of Communications Equipment Will Shrink By 9% In 2009 In the rankings of the top country markets for European purchases of communications equipment in 2009.1 -3% 2% Norway € 2. Greece and Finland make it into the top 10 European markets for communications equipment. © 2009. with the UK in fifth place.3 -32% 2% Denmark € 3. 2009 forecast) 2009* 2010* Germany € 14. Forrester Research.1 -26% 9% Slovakia € 0. European IT Market Outlook: 2009 To 2010 17 For Vendor Strategy Professionals Figure 9 Largest European Markets For Computer Equipment Are Germany And The UK A spreadsheet with additional data is available online.3 -25% 4% Hungary € 0. but the decreases will be more moderate in their own currencies (see Figure 10). the Netherlands.

a 1% decline from 2008.2 -11% 3% *Forrester forecast 46672 Source: Forrester Research.4 -10% 4% Czech Republic € 0. 2009 © 2009. Inc.18 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 10 Largest European Markets For Communications Equipment Are Germany And Italy A spreadsheet with additional data is available online. Finland.3 -9% -4% Finland € 1. Forrester Research.8 -2% 1% Belgium € 1. The Netherlands and Switzerland make up the rest of the top 10 (see Figure 11). despite being the home country for software giant SAP.5 -27% 1% Denmark € 0. and a 2% decrease for France from 2008 levels. the UK and France are tied as the largest country markets in Europe. August 28. comes in third with €10. with projected 2008 revenues of €15 billion. have a smaller share (13%) of that market than they do of the total IT purchases market (16%).7 -21% 4% France € 6.9 -7% 6% Italy € 8. which would make them collectively almost as big a market for software as Italy and Spain combined. Reproduction Prohibited .1 -9% 6% Switzerland € 2.2 -15% 7% Poland € 0. purchases of software products and spending on maintenance and subscription fees will decline by 5% in 2009. Germany.3 billion in software purchases in 2009.6 -5% 3% Spain € 7. with license revenues for new software down by 10% or so.3 -21% 7% Slovakia € 0. Communications equipment purchases % change from prior year (billions of euros. a 12% drop in euros for the UK (-5% in pounds sterling).0 -10% 6% Norway € 0.1 -6% 8% Ireland € 0. The Nordic countries of Denmark. while coming in fourth and fifth in the European software market.8 -4% 2% UK € 6.5 -20% 2% Hungary € 0. Inc. Norway.1 -20% 10% Austria € 1.4 billion in revenues.6 -10% 4% Netherlands € 3.3 -1% 1% Greece € 2. or of Germany alone. European Purchases Of Software Will Shrink By 5% In 2009 For Europe as a whole. and Sweden will have €7. 2009 forecast) 2009* 2010* Germany € 9.6 -7% 6% Portugal € 1. For software. Italy and Spain.8 -8% 5% Sweden € 1.

Italy and the Netherlands are the next largest markets for project-based IT services. where cutbacks are likely to be 15% or more (see Figure 12).4 -1% 2% UK € 15.1 -3% 2% Norway € 0. but by 4% in pounds sterling.2 -19% 10% Slovakia € 0. As with software.7 4% 1% Belgium € 1.2 -2% 7% Italy € 4. Inc. Inc. © 2009.1 -1% 1% Czech Republic € 0. The German and French markets for IT services will slip by 2% in 2009. the UK market will drop by 12% in euros. 2009 .4 0% 5% Ireland € 0. Forrester Research. followed by France.0 -13% 7% Austria € 1.1 -3% 0% Netherlands € 3. The exception will be the Central European and Baltic countries.3 -14% 7% Finland € 1. down 4% from €57 billion in 2008. European Purchases Of IT Consulting And Systems Integration Services Will Shrink By 4% Forrester last published a forecast for the European IT consulting and outsourcing market in 2006.0 -3% 7% Greece € 0. Software purchases % change from prior year (billions of euros.8 -5% 7% Switzerland € 2.9 6% 6% Portugal € 0.3 -5% 10% Sweden € 3. 2009 forecast) 2009* 2010* Germany € 10.7 While that report has not been updated. The market will be €54 billion in 2009. With The UK And France Ahead Of Germany A spreadsheet with additional data is available online. European IT Market Outlook: 2009 To 2010 19 For Vendor Strategy Professionals Figure 11 Largest European Markets For Software. Most European countries will cut their purchases of IT consulting and systems integration services by 2% to 3%. Germany is the largest European market for consulting and systems integration services.5 -4% -1% Spain € 4.2 -12% 9% France € 15.5 -26% 4% Denmark € 2. with the UK a distant third.1 -9% 8% *Forrester forecast 46672 Source: Forrester Research.4 -14% 10% Poland € 0.3 -18% 6% Hungary € 0. Switzerland and the Nordic countries have a disproportionate share of the European IT services market at 13%. we have adjusted the data in that report based on trends for software investment (since systems integration work for software is the largest category of IT services spending) in each market as well as overall trends for IT services vendor revenues in Europe. while Spain is under-represented. Reproduction Prohibited August 28.

0 -3% 4% Greece € 0. IT consulting and systems integration services purchases % change from prior year (billions of euros.0 -15% 2% *Forrester forecast 46672 Source: Forrester Research.1 -2% 6% Czech Republic € 0.7 -12% 3% France € 12.20 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Figure 12 Largest European Markets For IT Consulting And Integration Are Germany and France A spreadsheet with additional data is available online. Inc.0 -2% 5% Norway € 0. down 6% from €42 billion in 2008.1 -13% 2% Hungary € 0.5 -21% 0% Denmark € 1.2 -11% 7% Finland € 1. European Purchases Of IT Outsourcing Services Will Shrink By 6% In 2009 In our calculation of IT outsourcing services. August 28.8 -2% 6% UK € 6. The UK is by far the largest European market. 2009 © 2009. Reproduction Prohibited . 3 France. with insourcing taking place in these markets as the challenges of laying off staff causes firms to bring outsourced activities back in house to put their staff to use.8 -12% 5% Poland € 0. Inc. The German and French markets for IT outsourcing services will slip by 3% in 2009.9 -2% 6% Netherlands € 3.8 -3% 4% Switzerland € 2. 2009 forecast) 2009* 2010* Germany € 14.8 -2% 5% Sweden € 1.5 -2% 6% Spain € 1. but by 2% in pounds sterling. or Switzerland (see Figure 13). Forrester Research. 2 Germany or No.1 -2% 6% Ireland € 0.0 2% 6% Portugal € 0.1 -15% 6% Slovakia € 0. The Netherlands is the fourth largest IT outsourcing market. That still leaves €394 billion in 2009. we exclude the business process outsourcing category because very few companies count BPO services — or even the IT component of BPO services — in their IT budgets. with more activity than Italy and more than twice as much IT outsourcing as occurs in Spain.5 -2% 6% Italy € 4.6 -3% 5% Belgium € 0. with almost twice the amount of IT outsourcing purchases as No. The UK IT outsourcing market will decrease by 10% in euros in 2009. Sweden.8 -13% -2% Austria € 1.

2009 .7 -2% 6% Greece € 0. Inc.0 -16% 1% *Forrester forecast 46672 Source: Forrester Research. for the next 12 months or so.1 -3% 5% Ireland € 0. Forrester Research. European IT Market Outlook: 2009 To 2010 21 For Vendor Strategy Professionals Figure 13 Largest European Market For IT Outsourcing Is The UK. But the European IT market is still the second largest in the world after the US. Inc.6 -2% 6% Switzerland € 1. with vendors of different kinds of tech products focusing on different country markets in Europe based on where the demand for these products is likely to be best: © 2009.0 -1% 7% Netherlands € 2.2 -22% 0% Denmark € 0.3 -3% 5% Belgium € 0.6 -11% 7% Poland € 0. franc.5 -3% 5% Italy € 2.4 -3% 5% Sweden € 1.0 -14% 7% Slovakia € 0. where the strength of the dollar against the euro means every euro. Reproduction Prohibited August 28. So tech vendors cannot and should not write Europe off as a market to pursue.5 -3% 5% Norway € 0. IT outsourcing purchases % change from prior year (billions of euros. 2009 forecast) 2009* 2010* Germany € 7.0 -13% 2% Hungary € 0. pound. Then Germany And France A spreadsheet with additional data is available online. Europe will be the weakest in 2009. and Europe has many countries — and many companies — that are as advanced in their use of technology as the US or US firms.1 -12% 5% Finland € 0.2 -11% 0% Austria € 0. or kroner/krona/kurona of revenue generates fewer dollars in 2009 than in 2008.7 4% 8% Portugal € 0. This is especially true for US IT vendors.4 -3% 5% Spain € 1. tech vendors need to be selective in where they put their sales and marketing resources.1 -10% 6% France € 6.0 -1% 6% Czech Republic € 0. Re c ommen d ations Focus In 2009 on Specific Country Opportunities For Different Products Of all the geographic markets in the world for IT vendors.7 -3% 5% UK € 13. Instead.

France is already the largest European market for software. and Spain (among others) use IT outsourcing to a lesser degree as labor laws have discouraged adoption of IT outsourcing that could result in layoffs.” That alternative view is in fact what happened. France. Inc. Vendors of these mature hardware products should put most of their marketing efforts into these markets. So this time. Despite investments in 3G wireless systems. 2009 © 2009. in our alternative view.22 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals · “Tech 12” markets in Europe provide best opportunities for next-generation technology. we said: “The most likely alternative to this forecast is that the European economy follows the US economy into negative growth. A LT E R N AT I V E V I E W European IT Purchases in 2009 Turn OUt To Be Flat Or Just Down A Little A year ago. Spain. and the UK are the most likely buyers of these technologies. although software-as-a-service and cloud computing scenarios will also compete for this business. Coming out of the recession many firms may view IT outsourcing as an alternative to hiring new full-time staff. As noted earlier. so vendors of similar products should focus their efforts on these markets. and Central Europe provide growth potential for classic hardware. and smartphones and machine-to-machine interactions. · Different IT consulting services will follow the underlying product adoption. our main forecast was moderately bullish. automated spend analysis and supplier performance management. Germany. Look at the countries that are adopting the hardware and software that your services support. and Central Europe offer biggest markets for software apps. IT services vendors that focus on SOA. However. Switzerland. · Continental Europe has untouched opportunities for IT outsourcing. August 28. service-oriented architectures and business process management. and customer community platforms. but companies in France. storage. when we published our 2008 forecasts for the European IT market. causing tech purchases in Europe to decline in 2008. Finland. cloud computing and server virtualization. Greece. Sweden. these markets still lag behind the UK or the Nordics in adoption of broadband Internet network equipment or servers. SRM. Germany along with Austria and Central Europe are relatively underpenetrated for some software products and will be looking to software applications such as CRM. and target those countries. and SCM as a way to restore competitiveness. · Germany. companies and governments in Denmark. or unified communications will get the most traction in the “tech 12” countries. while those that concentrate on implementation of ERP or CRM systems will have more success in Germany and France. The UK has done extensive outsourcing of IT operations. BPM. · Italy. This is already the case for advanced software products such as contract life- cycle management. Forrester Research. globally competitive companies in all European countries will be interested in unified communications and videoconferencing. While leading. and PCs. Reproduction Prohibited . The Netherlands. Italy.

2) used 2001 to 2005 growth rates for Germany and the UK against updated 2005 IT services data to calculate updated historic spending. Iceland. and IT investment as a percentage of GDP. 2009 . we estimated these countries’ investment in each category as percentages of Greece’s (based on ratios of their GDP to Greece’s). Ireland. France. and customizable software. using the ratio of their nominal GDP growth rate to the European average. and Central Europe will come back strong. Benelux. While it is possible that economic conditions in Europe turn out to be worse than we assume. based on US data on the distribution of software between “own account. For 2001 to 2004. that is. Supplemental MATERIAL Methodology To start. and IT purchases in Europe will turn out to be flat or just down a little in 2009. For these countries where the OECD has not published data on investment in computer equipment. with a relatively mild and short-lived recession. UK/Ireland. Lithuania. So as markets in the Americas and Asia Pacific start to recover. a more positive outcome. and Nordic countries to the individual countries. the tech sector will improve with these economies. And most of them — with exceptions like Italy. Apart from the UK. but: 1) allocated multimarket numbers for Austria/Germany/Switzerland. where OECD data was not available. communications equipment and software from 2001-2006 (or latest available data. communications equipment. Forrester Research. many export-oriented countries like Germany. For minor European markets like Slovakia. Spain/Portugal. we collected data for major European markets from the Organization of Economic Co-Operation and Development on nominal GDP. Slovenia. © 2009. Latvia. We imported country-specific projections for IT services and outsourcing for 2005 to 2008 from the May 2006 “European IT Services Spending Forecast: 2006 To 2011” report. and Spain. Inc. which was 2004 or 2005 for some European countries). and 3) estimated 2001 to 2004 IT services and outsourcing spending for minor European markets using growth rates in this period for Spain and Portugal. we think it is more likely that they are better than projected. we estimated total IT investment using IT-investment-to-GDP ratios for similar countries such as Greece. We varied each country’s growth rates.” packaged. we used the November 2003 “Forecasting Europe’s Outsourcing Stampede” report. Reproduction Prohibited August 28. Benelux. IT investment on computer equipment. European countries did not have the kind of housing bubble or over-dependence on consumer spending that the US had. we projected IT category purchases by country for these years. European IT Market Outlook: 2009 To 2010 23 For Vendor Strategy Professionals our alternative is the reverse. We excluded BPO in order to focus specifically on categories in the IT budget. which Forrester includes in IT staff costs. Using Forrester data on the annual growth rates in European revenues of leading IT vendors by category for 2004 to 2007. We adjusted OECD data on investment in software to exclude the value of “own account” or internally developed software. etc. and software. We excluded 45% of the total value of software. If so. and perhaps the UK — don’t have the big fiscal deficits that the US has to handle.. Estonia.

we carefully screen respondents according to job title and function. Business Data Services ensures that the final survey population contains only those with significant involvement in the planning. Forrester Research. France. Additionally. was fielded to 3. Singapore. Inc. Germany. Companies Analyzed For This Document Accenture Getronics Affiliated Computer Services Hewlett-Packard Alcatel Hitachi Atos Origin Hyperion Solutions (prior to its acquisition by Oracle) Avaya IBM BearingPoint Infosys Technologies CA Lenovo Capgemini Lucent Technologies CGI Mercury Interactive (prior to its acquisition by Cisco Systems HP) Computer Sciences Corporation Microsoft Dell Motorola Electronic Data Systems NEC EMC Technology Nokia Ericsson Nortel Networks Fujitsu Oracle August 28. Survey respondent incentives include a summary of the research reports.497 IT executives and technology decision-makers located enterprises with 1. Forrester’s Business Data Services fields eight business-to-business technology studies in 19 countries each calendar year. India. and the United Arab Emirates. We have provided exact sample sizes in this report on a question-by-question basis. Mexico.24 European IT Market Outlook: 2009 To 2010 For Vendor Strategy Professionals Forrester’s Enterprise And SMB Global IT Budgets And Spending Survey. South Korea. South Africa. Russia. funding. For quality control. This survey is part of Forrester’s suite of Business Data Services studies. and purchasing of IT products and services. quotas are set for company size (number of employees) and industry as a means of controlling the data distribution and establishing alignment with IT spend calculated by Forrester analysts.000 or more employees in Australia/ New Zealand. Forrester fielded the survey from February 2009 to May 2009. as well as from companies with two or more employees in Canada. Reproduction Prohibited . Brazil. the United Kingdom. and the United States. 2009 © 2009. China. Exëvo fielded this survey via telephone on behalf of Forrester. Japan. Q2 2009.

€24 billion on infrastructure-related outsourcing.xls). Forrester Research. 4 We use the IMF assumption of a 2% decline of the US dollar against the euro. we exclude Bulgaria and Romania) plus Iceland. and the UK. Germany.org/dataoecd/18/26/2713584. Luxembourg. European IT Market Outlook: 2009 To 2010 25 For Vendor Strategy Professionals SAP Sun Microsystems Siebel Systems (prior to its acquisition by Symantec Oracle) T-Systems Enterprise Services Siemens Business Services Tata Consultancy Services Siemens Network Technologies (prior to its Unisys merger with Nokia) Wipro Storage Technology (prior to its acquisition by Sun Microsystems) Endnotes 1 The OECD published its latest Economic Outlook in June 2009. 6 We discussed the reasons for the different behaviors of the US and Canadian IT markets in our recent report on the US and Global IT markets.00. Slovenia. oecd. Finland. Czech Republic.” (http://www. 3 For example.html). Cyprus. Inc. The real GDP forecasts for the euro-zone countries are in its FlashFiles Summary of projections (http://www.oecd. Slovakia. France.org/document/18/0. CIOs feel they have to keep on investing in security software to stay ahead of threats and in software products to help with regulatory compliance. etc. Sweden. See the June 29. plus Switzerland. of which €17 billion will be spent on application outsourcing. though this may be too low. Latvia. Poland. €11 billion on business process outsourcing. 2009 . Reproduction Prohibited August 28. “European IT Services Spending Forecast: 2006 To 2011” report. the Netherlands. 2 The countries of Western and Central Europe include 25 countries in the European Union (prior to the accession of Romania and Bulgaria). Greece. See the May 3. Denmark. Ireland. Norway. Lithuania.en_2649_34109_20347538_1_1_1_37443. And IT management software and enterprise process applications help can drive down other costs. Norway. 5 Our definition of Western and Central Europe includes 25 of the 27 countries in the European Union (we include Austria. Hungary. “OECD Economic Outlook No. Liechtenstein. June 2009. and €56 billion on IT consulting and integration services. 2006.3343. and micro-countries like Andorra. 7 Forrester estimated that the total European market for IT services and outsourcing and for business process outsourcing in 2006 will be €109 billion. Italy. “US And Global IT Market Outlook: Q2 2009” report. Estonia. and Switzerland. Spain. 85. 2009. © 2009. Malta. Belgium.

We offer quantity discounts and special pricing for academic and nonprofit institutions. consulting. and technology industry leaders successful every day.forrester. MA 02139 USA Canada Korea Tel: +1 617.613.forrester. Forrester works with professionals in 20 key roles at major companies providing proprietary research. customer insight.com. Inc.com/about.5730. and peer-to-peer executive programs.367. (Nasdaq: FORR) is an independent research company that provides pragmatic and forward- thinking advice to global leaders in business and technology. Inc. For more than 26 years. Forrester has been making IT.6000 Denmark The Netherlands Fax: +1 617.com Germany United Kingdom Nasdaq symbol: FORR Hong Kong United States www. visit www.com.613. Australia Israel 400 Technology Square Brazil Japan Cambridge. +1 617. visit www. please contact Client Support at +1 866. or clientsupport@forrester.5000 France Switzerland Email: forrester@forrester.com India For a complete list of worldwide locations. Making Leaders Successful Every Day Headquarters Research and Sales Offices Forrester Research.7378. 46672 . For more information. events. For information on hard-copy or electronic reprints.613.forrester. Forrester Research. marketing.