MEDIUM AND LARGE BUSINESSES SHOW CONTINUED CONFIDENCE IN IT SPENDING

Business confidence strong; government weaker

• More than half of IT decision-makers in medium and large businesses expect to spend more on IT solutions including cloud computing, virtualization and security over the next six months.
• Forty-seven percent of medium-size businesses expect to replace or install new software for a significant part of their organization, up 11 percentage points from six months ago.
• Forty-eight percent of medium and 45 percent of large businesses expect to replace or install new hardware for a significant part of their organization, up from six months ago by 15 and five percentage points, respectively.

Vernon Hills, Ill. – May 4, 2011 –Overall confidence in economic growth is beginning to translate into anticipated spending in the IT marketplace. According to the latest CDW IT Monitor, IT decision-makers are confident in continued investment in hardware and software with an upward trend among medium and large businesses over the last six months.

Ninety percent of IT decision-makers at large-size businesses and 89 percent at medium-size businesses expect to purchase new hardware in the next six months. This is up three and nine percentage points among large and medium-size businesses respectively from six months ago.

“The signs of spending optimism we saw in the fourth quarter of 2010 are continuing,” said Thomas E. Richards, president and chief operating officer, CDW. “Business IT decision-makers appear to be more confident about making investments in hardware, software and services.”

IT industry sees solutions in the cloud
In addition to positive expectations for hardware and software spending, more than half of IT decision-makers in medium and large businesses expect to spend more on IT solutions in the next six months (56 percent and 57 percent, respectively). While overall the majority of those increasing spending on solutions in April expect it to be in virtualization (62 percent) and security (58 percent), most at medium and large businesses also predict they will spend more on cloud computing in the very near term (57 percent and 52 percent).

“During the recession, IT departments were challenged to find ways to reduce costs while maintaining productivity,” said Richards. “Virtualization and cloud computing emerged as key tools to help keep costs down and increase productivity. These tools combined with a more mobile workforce make the need for system security paramount.”

The CDW IT Monitor, which has been tracking IT sentiment since 2007, shows that three-quarters of those surveyed expect to replace or install new hardware or software in the next six months. This is largely consistent with December’s record high expectations of these measures, with hardware up four percentage points in October and up five percentage points year over year.

The positive outlook on IT spending is also consistent with other industry reports.

“We have certainly seen a stronger indication of potential IT investment in some of our recent research,” said Tiffani Bova, vice president, sales and channel strategies, Gartner. “Our forecast for U.S. spending growth is 4.6 percent.”1

The overall IT Growth Outlook (formerly the IT Growth Monitor Index), which measures six-month expectations for budget and staffing along with hardware and software procurement, is 67 for April 2011, down one point from December due to a lowered government budget outlook and less optimism for hardware and software purchasing by small businesses.

The sentiment among small businesses has leveled off after growing in the last quarter of 2010. Small business lost three points in the small business IT Growth Outlook from December (an index score of 51 versus 54), but is still two points above April 2010 (an index score of 49).

The public sector is more tempered with a slightly pessimistic reading with questions looming about federal budget expectations. The IT Growth Outlook for government is down overall. The index number at the federal level is 64, which brings it to a record low and five points below December 2010. At the state level, the index score is 59, down four points from December. It is relatively flat at the local level with a reading of 62, down one point from the last survey.

For more information about the sentiment of IT decision-makers, please visit www.cdwitmonitor.com.

1Gartner Market Databook, 1Q11 Update, Ken Newbury, March 29, 2011

About the CDW IT Monitor
The CDW IT Monitor was created by CDW, and research and analysis is conducted by independent polling firm Richard Day Research of Evanston, Ill. At the center of the CDW IT Monitor is the IT Growth Outlook, an index number, which registered an initial benchmark reading of 63 in December 2007. Results are calculated on a scale of 0-100, with 100 indicating the highest level of confidence. Future readings of the CDW IT Monitor will continue to yield comparisons to previous scores, allowing for an interpretation of the direction of sentiment in the IT marketplace.

Decision-makers are invited from two large national panels of IT decision-makers built and maintained by Research Now and Survey Sampling International. Data reported in this release are based on a survey of 1,046 IT decision-makers conducted between March 15 and March 21, 2011. Sampling is designed to reflect a broad spectrum of IT decision-makers among all sizes of companies, multiple industries, and across three levels of government. For the purposes of the CDW IT Monitor, company sizes are defined as: small (1-99 employees), medium (100-999 employees) and large (1,000 or more employees).

Data are weighted to ensure that CDW IT Monitor calculations closely represent the overall population of corporate and government employers in terms of size, based on the number of employees. Corporate data are weighted according to U.S. Economic Census data, and government data are weighted according to data from the U.S. Census Bureau's annual survey of government employment. The margin of sampling error for a survey based on this many interviews is approximately +/- 3 percentage points overall, +/-4 percentage points for the business sector, and +/-6 percentage points for government.

About CDW
CDW is a leading provider of technology solutions for business, government, education and healthcare. Ranked No. 38 on Forbes' list of America's Largest Private Companies, CDW features dedicated account managers who help customers choose the right technology products and services to meet their needs. The company's technology specialists offer expertise in designing customized solutions, while its advanced technology engineers assist customers with the implementation and long-term management of those solutions. Areas of focus include notebooks, desktops, printers, servers and storage, unified communications, security, wireless, power and cooling, networking, software licensing and mobility solutions. CDW was founded in 1984 and employs more than 6,300 coworkers. In 2010, the company generated sales of approximately $8.8 billion. For more information, visit CDW.com.