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To: PCSS who wrote (1969)	10/16/2002 7:54:19 PM
From: PCSS	Read Replies (1) \| Respond to of 4345

W.Europe's IT spending to creep up in 2003 - survey LONDON, Oct 17 (Reuters) - Corporate spending on IT services and products in Western Europe will finally show signs of improving next year, reversing two years of dismal market conditions, high-tech research firm Gartner said on Thursday. But Gartner researchers cautioned it wouldn't be until early 2004 before the region's battered technology sector experienced a sustained, albeit modest, recovery. Global tech stocks have taken a beating all year, dogged by a slowing demand for such high-tech staples as semi-conductors, networking software and personal computers. On Wednesday, the Dow Jones Technology stock index (XX:SX8P) sunk nine percent to 173.34. In its annual survey of European companies' chief information officers (CIOs) Gartner said IT spending on software, hardware and services would more than triple, amounting to a 5.4 percent increase. "In the current market this is welcome news for vendors, but it won't radically change their financial position," said Steve Prentice, director of research for Gartner's Europe, Middle East and Africa operation. "We're still pretty cautious. We're not out of the tunnel yet," he added. LIGHT AT THE END OF THE TUNNEL? Gartner polled more than 300 CIOs. Seventy-eight percent of respondents said they expect IT budgets to stay the same or increase in 2003. In 2001 and 2002, IT spending in Western Europe was flat, the research group said. The Gartner finding though belies many high-tech market assessments. One London-based investment bank, for example, projected IT spending in 2003 would be flat to down by five percent. "I don't see an absolute growth in IT spending next year. We need several more quarters of sustained revenue growth first. Until then, we won't see an uptick in IT spending," the analyst, who asked not to be indentified, told Reuters. IT consultants, plus hardware and software vendors of the likes of Hewlett Packard (HPQ) , Cap Gemini <CAPP.PA> and International Business Machines Corp (IBM) , have been anxiously awaiting clues that corporations will resume IT investment. But with global economies wavering and corporate earnings on the slide, there have been few indicators that a sustained high-tech recovery is in the offing -- until now. The Gartner survey warned the Western European rebound would be patchy though. Companies in the United Kingdom, Ireland and Italy would lead the growth charge while German firms, on a whole, are expected to decrease IT spending. The resurgence will be led by software and IT services, which will hover near double-digit growth, while hardware spending will remain dead-flat, Gartner reported.