Gartner : Education IT Poised For Growth

Monday, October 4, 2010

While the rest of the world will experience increases in education IT spending this year, in the United States, information technology will be flat through the end of 2010.  But, according to research firm Gartner, growth will resume in 2011 and continue at least through 2014.  Worldwide, education has settled squarely into the middle of a trend toward single-digit increases in IT spending.  It will be up about 2.5% in 2010 compared with 2009, reaching $64.15 billion by the end of the year, according to a report released earlier this week by Gartner, “Forecast: Enterprise IT Spending by Vertical Industry Market, Worldwide, 2008-2014, 2Q10 Update.” (That’s up from about $62.61 billion in 2009.) Across all sectors, IT growth from 2009 to 2010 will be 2.9%, reaching more than $2.4 trillion by the end of the year, the report said. (That’s actually a downgrade from a previous forecast earlier this year.)

In the United States, the forecast isn’t so optimistic. According to Kenneth Brant, research director at Gartner, both K-12 and higher education spending in IT will remain flat: $12.115 billion for colleges and universities and $9.079 billion for primary and secondary institutions.  But the situation in education could have been worse.  Rishi Sood, vice president at Gartner, said the American Recovery and Reinvestment Act (ARRA) has kept education IT spending from going negative.  “… Without some of the additional funding from ARRA/Stimulus, education IT spending would have experienced negative growth,” Sood told us via e-mail.  “However, with this funding now included, we have kept the market flat.  The economic downturn has affected education spending since 2008 and forced significant revisions to IT spending priorities.”  According to Gartner’s Brant, the post-2010 recovery in American education IT will come about more quickly in higher education than in K-12.  In 2011, higher education IT spending will increase 2.9%, while K-12 will grow at a more modest 2.2%.  Overall education IT spending in the United States will increase 2.6%.  The compound annual growth rate (CAGR) from 2009 to 2014 will be 2.9% across all education segments in the United States, according to Brant.  In K-12, that figure will be 2.8%. In higher ed, it’s projected at a more aggressive 3%.  So where are education institutions putting their tighter resources?  According to Gartner’s Sood, “Education organizations are making some tangible investments on two fronts: areas of IT to reduce long-term management costs and broadband/mobility services.”  He listed five areas toward which IT departments in education are shifting their focus, cited here nearly verbatim from an e-mail communication:

  • IT cost optimization;
  • Consolidation/rationalization;
  • Cloud-based services, particularly SaaS;
  • Broadband and wireless services; and
  • Content management.

Reference : http://thejournal.com/articles/2010/08/12/education-it-poised-for-growth.aspx

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