European IT market to grow 4% in 2005

With foreign currency fluctuations, high oil prices, and elevated unemployment continuing to buffet Europe’s economy, IT spending growth will remain modest this year. IDC forecasts total IT market growth of 4% in the region for 2005, compared with a previous forecast of 5.6%. In 2004, the Western Europe IT market grew by 12% in US dollar terms due to the strength of the euro against the dollar, but by only 3% in euro terms. Currency fluctuation also impacted the European market in other ways, ranging from pricing to sourcing strategies. Packaged software markets enjoyed the fastest growth as the market recovered gradually from the downturn of 2001?2003.