From the Editor-in-chief

A little optimism to greet the new year!

It’s been more than three years since the technology stock crash and the events – economic and tragic – that combined to reduce IT investments to a trickle. Tight budgets have meant that CIOs have been forced to squeeze more from what they have, and many IT vendors have fed largely on small-upgrade scraps between rare new-project banquets.

The question we’ve heard most often in the last year or so is, “Will growth in spending on IT ever return and, if so, when?”

Well, I’m feeling distinctly optimistic about 2004 and beyond. The analysts – IDC, Gartner, Forrester, et cetera – are coming close to consensus on a healthier 2004. Not the heady, double-digit growth we saw around the turn of the millennium, but healthy, steady growth, with forecasts ranging from three per cent to as high as eight per cent.

In our own annual survey, conducted with Athabasca University in October 2003, 46 per cent of respondents report IT budget increases for 2004.

More important is the reality of rising corporate profits in Canada and the U.S. This is the factor most frequently cited by CIOs as the prerequisite for increased investment in IT. And real growth in IT spending is already being reported across a broad range of industries.

Looking farther out, the industry is waiting for the next ‘big thing’ that will create a wave of growth comparable to those attributable to the PC, networking, Y2K and the Internet. There are a number of candidates; wireless, biotech and privacy issues are all potential or necessary areas of investment. But the next major and enduring driver of IT spending is likely to be Radio Frequency Identification (RFID).

Although there are economic, technical and social issues that currently inhibit the widespread adoption of RFID, it’s already well out of the starting gate. It’s a reasonably mature technology already in use in a variety of applications such as Esso’s Speedpass, and the giants of global retailing – including the 800-pound gorilla of retailing, Wal-Mart – are all getting behind it.

The data volumes and the resulting processing and data analysis demands will be huge. If you’re in manufacturing, retail or logistics, there is likely to be RFID in your near-term future, and it’s not too early to start planning for the infrastructure upgrades that will be required.

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Jim Love, Chief Content Officer, IT World Canada

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