Asia Pacific governments IT spending holds up as economies falter

Peter Dinham
Monday, 30 March 2009 08:01

IT Industry - Deals

Public sector spending on enterprise networking equipment throughout the Asia Pacific market is holding up well despite the ravages of the economic downturn.

Spending on networking equipment in 2008 by the public sectors of countries in the region(excluding Japan) reached US$1.1 billion, with Greater China, which includes Hong Kong and Taiwan, contributing the largest share of the spend at 42.7%. Australia/New Zealand is the second largest public sector market, with India the fastest growing market in the region.

The latest figures on the enterprise networking equipment market are from Springboard Research who have estimated that the market will growth further from US$1.1 billion at the end of last year to US$1.7 billion by 2012, amounting to a compounded annual growth rate (CAGR) of 12%.

A senior analyst at Springboard, Nupur Singh Andley, says a major trend in the region’s public sector vertical is cross-department collaboration, with state or local governments aggressively deploying networking framework to facilitate connectivity with other states and regions.

“The focus of networking investments, especially in developing markets like China and India, has shifted to semi-urban and rural pockets where even the most basic network infrastructure is not present,” Andley added.

According to the findings of the survey of public sector IT decision makers, over a fifth of respondents claimed that their budgets for networking were more than 40% of overall IT budgets, with this trend more prevalent in China over other regions.
 
The survey also revealed that the main factors influencing network purchasing decisions by the respondents were equipment provider’s expertise, technological strength and value for money - in that order.
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