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Study Pessimistic About Future Tech Spending

HAVERFORD, Penn.-A new national survey found a slight uptick in IT spending plans. But the analysis adds, "this is far from any signal of a robust pickup in information technology capital spending."

The Wendover-Global Insight IT Spending Index increased by a percentage point overall in August, but "confirmed that CEOs are still wary of committing to discretionary IT projects and the flat prognosis for the second half of the year remains."

"The mild up-tick in the Index is less of an indication of overall breadth in spending and more of a reflection of possible firming in certain industries," the analysis stated.

Wendover Corp. said its data is based on the133,000 surveys it conducts annually with IT decision-makers at 80,000 of the largest corporations throughout the U.S. and the United Kingdom, including every Fortune 500 corporation. The Index is pegged at 100 points in Q4-1999. The IT Spending Index is published monthly through a partnership of the two companies, Wendover Corporation and Global Insight, Inc.

Among the findings:

* Although IT spending has been fairly volatile among the communications industries, the sharp increase in August's index to 82 from lows in the 60s over the first half of 2003 is a potential bright spot driven by high speed and IP networking.

* IT spending in finance, real estate, and insurance continues to stagnate. These industries have traditionally been sources of fuel for networking capital and services, but little can be expected in the coming quarters.

* An abrupt decline in the spending index for consulting, engineering and accounting services was recorded for August. Coupled with the continued decline in business services, another industry intensive in its use of IT, this provides more evidence of weak new IT spending over the next two quarters.

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