State, Local Governments To Spend $62.4 Billion On IT Through 2009

With the first part of the year being a traditionally slow season for federal purchasing, a report says that VARs may want to take a closer look at state and local government, which is expected to grow technology spending by more than 13 percent in the next five years.

Spending by state and local government will increase from $55 billion to $62.4 billion, according to a report by Datamonitor, a business-intelligence firm based in London. Growth will relate primarily to public safety--in unison with the federal government--and social services, according to the report.

"There's a need to increase efficiency, productivity and reduce costs by local and state governments," says Kate McCurdy, public sector technology analyst with Datamonitor and author of the study.

Doing so will come from initiatives that consolidate IT management and operations into a central office or department. California, for example, is currently undergoing its second technology consolidation plan in 10 years, integrating management of statewide IT applications, systems and projects.

On the public-safety side, state and local governments will seek solutions that improve information-sharing and help agencies communicate across government. While that will continue to fuel demand for networking equipment, Datamonitor anticipates more significant growth in services (support, consulting, systems integration and outsourcing) and software that improve back-office processes.

To get in on the opportunities, McCurdy says VARs need to familiarize themselves with agency objectives.

"State and local governments want to deal with companies that understand their mission--getting in and making themselves aware of how the agency serve constituents and how IT can help them do it," she says.