Linux, PDAs and consumer goods drive IT growth

Internet-related investments in Linux servers, PDAs, digital storage and new portable consumer products will be the highest growth areas in the global IT market in the next year, according to the Organisation for Economic Co-operation and Development (OECD).

The OECD's biennial IT Outlook report predicts the worldwide IT sector to grow at six per cent in 2006, with growth fairly evenly-balanced across the world's industrialised nations.

The report said: "Overall the prospects for continuing balanced and sustained growth at a relatively high rate are good but a return to the unsustainable annual rates of 20 to 30 per cent growth of the late 1990s is unlikely."

The OECD warns that as many IT products increasingly become commodities, very rapid growth is confined to new and niche goods and services and to emerging geographical markets.

But the OECD warns that as many IT products increasingly become commodities, very rapid growth is confined to new and niche goods and services and to emerging geographical markets, and widespread restructuring is expected to continue in IT services, telecoms and digital content.

The report said: "Open source (the 'Linux effect'), online delivery of IT services (the 'Google effect') and new digital products are... disrupting how technology is developed and delivered."

The other main theme in the OECD report is the continuing globalisation of the IT sector and the rapid growth of China and India. IT spending is increasing most rapidly in emerging non-OECD countries. China's IT spend in 2005 is estimated at $118bn, while India and Russia are experiencing growth in IT spend of around 25 per cent per year.

The report also singles out those technologies with the potential to have strong economic and social impacts in the near future, and highlights "ubiquitous networks" that make it possible to follow people and objects and provide real-time tracking, storing and processing of information.

These technologies include RFID and other sensor technologies and location-based services.