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Technology Stocks : Hewlett-Packard (HPQ) -- Ignore unavailable to you. Want to Upgrade?

To: PCSS who wrote (572)	5/22/2002 7:26:58 AM
From: PCSS	Read Replies (1) \| Respond to of 4345

From G-S Research Alert this morning: THE OUTLOOK FOR IT SPENDING * Almost 60% of respondents' budgets have been adjusted in the last three months, with bias to the downside. * Overall, neither budget levels nor specific planned projects are expected to change much through the rest of the year, although there is potential for significant budget 'flush' in the fourth quarter. About half the market(46%) expects IT budgets to remain unchanged for the balance of 2002 and the remainder is about evenly split between those expecting budgets to increase (retail and commercial banking) and those expecting a decrease (the largest weighting is in the telecommunications sector). * The pricing environment remains daunting-50% of buyers say they have increasing pricing leverage with vendors, versus 41% saying unchanging and 9% saying declining leverage. * Recent IT spending adjustments are balanced across operating and capital budgets. * Security, storage, and migration to Web-based applications are principal recipients of spending increases this year. TOP VENDOR BENEFICIARIES OF CURRENT SPENDING TRENDS * Enterprise software-BEA Systems, Microsoft, and Veritas. * Enterprise systems-Dell and Compaq. * Security-Internet Security Systems, Cisco. KEY FINDINGS BY PRODUCT AREA Storage * Results underline the strong secular growth trends in storage networking. * EMC continues to be the primary go-to vendor for storage area networking, followed by Compaq and IBM; more surprisingly, EMC also leads in network- attached storage. Web services * Almost two-thirds of companies plan to implement Web services within the next 2 years, with most of those having projects at least in development by the end of 2002. * 52% of respondents plan to use the Java platform versus 31% for Microsoft's .NET; others plan to use both. PCs * Purchases of desktops are being deferred in favor of more laptops and handhelds, confirming the trend toward greater mobility. * Most companies expect at least 256MB configurations by the end of the year, a good sign for the ongoing Microsoft operating system upgrade cycle. Networking * Continued high degree of interest in networked storage, both SAN and NAS. * Higher interest in VoIP. * Outsourcing of high-level services is a challenging area. OTHER TAKEAWAYS * Oracle ranked as the overwhelming top choice (59%) for databases on which to develop/purchase new enterprise applications-a very different sense of momentum than other recent market share studies we have seen. Microsoft SQL Server ranked second at 23% and IBM DB2 third at 13%. * Significant pent-up demand appears to exist for disaster recovery projects. * Security products show continued strong adoption. * IT buyers still envision moving more and more business interaction to the Internet, driven by cost and competitive issues. RESPONDENT OVERVIEW * Our IT Survey, conducted jointly with Gartner, targeted attendees of Gartner Symposium/ITxpo 2002, held in San Diego between April 29 and May 2, 2002. Our survey responses were received from almost 400 executives and IT professionals between April 5 and May 14, 2002. * Respondents roughly tracked our estimate of end-market demand share in key categories such as financials and manufacturing. However, we expect that relative weakness in the under-represented communications sector and relative strength in the over-represented government sector likely resulted in a slightly positive bias to the survey results.