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Economic Downturn Hits Storage Spending

More than two thirds of large companies plan to spend less on storage in 2009, a survey by TheInfoPro suggests

The bad economy and spending cutbacks by companies in a wide variety of industries will result in smaller storage budgets in 2009, according to a survey released today by TheInfoPro Inc. (TIP) . The research firm did one-on-one interviews with IT and procurement personnel at nearly 65 large companies and government organizations and found that, on average, storage budgets will decrease by around 14 percent in 2009.

The decline in storage spending began in the fourth quarter of this year, with nearly one third (32 percent) of those interviewed saying they expect to end up spending less in 2008 than had been originally budgeted. Their average spend on storage in 2008 will be $10.7 million.

Some 68 percent of those interviewed expect their company to spend less on storage in 2009 than in 2008, while only 32 percent expect to spend the same or more on storage next year. That's a big drop from a year earlier when 81 percent expected to spend more on storage in 2008 than they did in 2007.

Only 21 percent of those interviewed expect to spend more than $10 million on storage in 2009, a drop of nearly 10 percent from a year earlier. Hardest hit will be technology companies, where 75 percent expect to spend less on storage next year; financial services, where 68 percent expect to spend less; and manufacturing, where 63 percent plan to spend less.

"We saw pockets of strength in health care and pharma. Oil and gas is not looking too bad, and there were positive signs in some parts of government, but the sample was small," TIP CEO Ken Male told Byte and Switch.

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