American Recovery and Reinvestment Act Expected to Stimulate More Than $100 Billion in Technology Spend in Energy, Healthcare, and Government, According to New IDC Study ; Industry Research Identifies High-Priority Initiatives and Related Technology Spending

FRAMINGHAM, Mass. – March 17, 2009 – In a newly released study, IDC’s Industry Insights, a series of industry-specific research and advisory business units, has examined the implications of the U.S. economic stimulus plan, the American Recovery and Reinvestment Act (ARRA), and quantified the technology spending that may be stimulated from initiatives to be deployed in the three vertical markets of energy, government and healthcare. The company estimates that approximately $101.2 billion in technology spend will be generated over the next five years. The estimate includes both information technology (IT) spend – traditionally the focus of IDC’s market research – as well as non-IT technology in these sectors, such as smart meters, in-home display devices, energy management systems, and renewable energy technologies surrounding wind and solar power.

The ARRA will fund some of this spend directly, but additional technology spending will be stimulated as the legislation provides incentives and tax rebates for the projects it promotes. Data on Industry Insights’ analysis of the ARRA can be found in the report, Business Strategy: Capturing Your Share of the American Recovery and Reinvestment Act (Document # 217404), currently available at www.idc.com.

“While the ARRA does not provide detailed information about the exact amount of technology spending that will be allocated, the Industry Insights companies performed an extensive review of the legislation and held discussions with industry technology buyers, to estimate the amount of technology spending that is likely to be generated as a result of the ARRA's key initiatives in energy, healthcare and government,” said Meredith Whalen, group vice president and general manager, Vertical Market Business Units at IDC.

IDC’s Industry Insights anticipates that the more than $40 billion investment the ARRA targets for the energy industry will stimulate approximately $77.6 billion in technology spending. The energy initiatives that will experience the most growth will be related to intelligent grid, renewable energy, and energy efficiency.

The healthcare industry is expected to see $21.1 billion in technology spending, with the largest portion concentrated on promoting deployment and usage of electronic medical and electronic health records, including incentive payments to physicians who implement and use these tools. Additional funds will be steered to technology solutions that measure the comparative effectiveness of programs and clinical intelligence solutions.

Within the government sector, the ARRA will provide approximately $2.5 billion in technology funding to Federal agencies for new and existing programs, including allocations for the Social Security Administration, the Department of State, and the Department of Homeland Security. Industry Insights’ research identifies 12 different government technology opportunities that are anticipated to be supported by the new legislation.

In addition to spending for improving the infrastructures necessary to support the management of the ARRA funds, the Government also plays a second role in the ARRA scenario – that of the gatekeeper of funds. Industry Insights provides guidance on how technology suppliers can best engage with the Government and plan the best business strategies to pursue new revenues from this significant opportunity. One key strategy will be the ability to demonstrate results that are achieved in line with the ARRA’s promise of economic recovery.

The IDC Industry Insights companies that focus on the vertical markets highlighted by this research have conducted in-depth analysis on many of the technology initiatives that are expected to see the greatest opportunities from the ARRA. Energy Insights provides coverage of the intelligent grid, distributed and renewable energy, and energy efficiency. Health Industry Insights provides perspectives on the healthcare provider, healthcare payer, and drug discovery markets. Government Insights research will cover both the IT spending that government will make for its own internal operations and well as the best approaches for navigating through the buying cycle.

For additional information about Industry Insights’ analysis of how the American Recovery and Reinvestment Act will affect technology spending, or to set up a one-on-one briefing with an Industry Insights analyst, please contact Sarah Murray at 781-794-3214 or sarahbethmurray@gmail.com. Reports are available to qualified members of the media. For information on purchasing reports, contact insights@idc.com; press personnel should email sarahbethmurray@gmail.com.

About IDC's Industry Insights Companies

IDC's Industry Insights companies provide industry executives with research-based advisory and consulting services that enable information technology (IT) and business executives to maximize the business value of their technology investments. Industry Insights covers the industry value chain for energy, financial services, government, health, retail and manufacturing. Staffed by senior analysts with extensive experience in these industries, Industry Insights provides a portfolio of offerings that are relevant to both IT and business needs.

IDC is the premier global provider of market intelligence, advisory services, and events for the information technology and telecommunications industries. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. For more information about IDC and its Industry Insights Companies, please go to www.idc.com.

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