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To: lml who wrote (15298)	2/14/2001 5:50:09 PM
From: Bipin Prasad	Respond to of 19079

Goldman Survey: IT Spending To Grow 5%-10% This Year By PAT MAIO Of DOW JONES NEWSWIRES (This report was originally published late Tuesday.) LA QUINTA, Calif. -- Despite signs that the economy is slowing, a Goldman Sachs survey of large high-tech companies shows that 71% say they expect to continue investing significantly in information technology in 2001. Goldman released the survey Tuesday at a technology conference here which it is sponsoring this week. Goldman polled well over a hundred IT managers at companies with more than $1 billion in annual revenues employing between 5,000 and 30,000 workers. Goldman concluded from the survey that overall IT spending is likely to grow by 5%-10% this year. "Although this represents slowing from 2000's IT spending growth of about 11%-12%, it is impressive not so much for the absolute spending rate as for the fact that most of the survey was done in early January, after it had become clear that the economy was slowing significantly," Goldman said. "What surprised me was I thought spending would have declined after Jan. 1, granted that could still take place," said Laura Conigliaro, analyst with Goldman Sachs, in explaining the survey's findings. Conigliaro told Dow Jones Newswires she was also surprised that the Linux operating system seemed to have stalled somewhat in its rollout. "It seems to have come up at a lower interest level at enterprise firms, but IBM only recently put some muscle behind it," Conigliaro said. Priority spending areas center around Internet-enabled infrastructure, the survey found. These include enterprise software, enterprise servers, storage area networks and data networking. Within these areas, the emphasis is on reliability, security, quality of service and support, the survey said. When IT managers were asked which vendors they plan to buy more products from, many responded with familiar names, led by Cisco Systems Inc. (CSCO), EMC Corp. (EMC), Microsoft Corp. (MSFT) and Oracle Corp. (ORCL). IT managers continue to buy from the recognized leaders, the study concluded. The survey also says that fundamentals in many areas of technology are weak and "probably getting a bit worse." Conigliaro said "a decreasing number" of high-tech companies are saying good things about their lines of business. The survey did note that some high-tech companies may get some help from the Federal Reserve's move to ease monetary policy. "Although the CEOs of most technology companies are pointing to the second half, and it feels entirely reasonable to assume that tech stocks and their fundamentals will follow the Fed, the evidence is not yet there. As a result, investors have been leaning in a more defensive direction for tech stocks," Goldman said. -By Pat Maio, Dow Jones Newswires, 323-658-3776; patrick.maio@dowjones.com