Forrester now says '09 U.S. IT spend to drop 3.1%

The analyst firm had earlier predicted a 1.6 percent increase

Forrester Research is now predicting that U.S. IT spending will drop by 3.1% this year, shattering its previous projection of a 1.6% increase.

Slideshow: What tech industry CEOs are saying about the economy

In revising its forecast, Forrester cited the drop in gross domestic product during recent quarters. However, Forrester is also predicting that IT spending will pick up late this year, and continue growing strongly in 2010.

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Forrester Research is now predicting that U.S. IT spending will drop by 3.1% this year, shattering its previous projection of a 1.6% increase.

Slideshow: What tech industry CEOs are saying about the economy

In revising its forecast, Forrester cited the drop in gross domestic product during recent quarters. However, Forrester is also predicting that IT spending will pick up late this year, and continue growing strongly in 2010.

Meanwhile, computer equipment sales will be hardest hit in 2009, with a 6.8% decline, followed by a 7% jump next year, Forrester said.

Telecommunications, videoconferencing and mobile technologies will also suffer, dropping by 7.8%, with a 4.8% rebound expected.

Software revenue will drop 0.4% this year, with steadier income streams such as maintenance fees and subscriptions balancing a drop in license sales. Forrester is predicting 6.3% growth in software during 2010.

The IDG News Service is a Network World affiliate.