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CIOs Strong on Storage, Survey Says

IT managers spend less these days, but storage is a high priority, and storage suppliers are among the brightest prospects for investors, according to a report from Goldman Sachs & Co.

The firm's quarterly survey of about 100 IT managers in U.S.-based multinational firms shows "stable, but uninspiring spending so far this year," write analyst Laura Conigliaro and colleagues in a note today. Participants, who were polled in late February, plan to increase overall IT spending in 2005 just 3.6 percent. They estimate capital spending on hardware and software to grow 2.9 percent.

When Goldman polled the managers in December 2004, the numbers were higher: Respondents planned a 3.9 uptick in spending for 2005, and growth of 3.7 percent in capital outlay.

Despite the drop, analysts expect overall 2005 spending to grow 4 percent to 5 percent. And so far, the 3 to 4 percent growth estimates given by survey respondents this year top the 2 to 3 percent estimates given last year.

Other survey findings show storage will account for a significant budget chunk:

  • Storage software, including backup and replication programs, continues to be one of the highest priorities for IT managers.
  • High-end storage arrays have moved from medium priority in the October 2004 survey to the high-priority list. At the same time, low-end storage arrays have dropped from high- to medium-level priority status.
  • Interest in high-end storage is growing, Goldman maintains, due to user demand for more capacity and ongoing interest in SANs as a way to relieve disk shortages on enterprise hosts.
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