When Tech Spending Slows Down, Hug Your VendorBy Larry Dignan | Posted 07-21-2006
With the second-quarter earnings season in full bloom, it's becoming clear that there are a few potholes in technology spending.
Sales cycles are getting longer. Growth forecasts are coming down. What's it mean for you? Potentially, some leverage.
All customers should know the health of their key vendors, because there could be a buyer's market emerging.
It's too early to gauge exactly how much leverage customers could garner, but it's worth monitoring.
Recent developments to ponder:
"Bookings were lower than expected, and business deteriorated in June," said ThinkEquity Partners analyst Eric Ross in New York. "Management stated that customers increased their level of scrutiny, particularly in June."
The play for customers interested in IBM's services: Play hardball, since IBM may be willing to cut a deal to land a signing in its pipeline.
According to Thomas Weisel analyst Tom Roderick, SAP is banking on a budget flush by customers to save the second half.
Read the full story on eWEEK.com: When Tech Spending Slows Down, Hug Your Vendor