Global enterprise IT budgets have grown in 2006 and will keep growing in 2007, according to a survey by Datamonitor.

But the research firm says the increases are not happening across the board, with 21 per cent seeing budget decreases in 2006 and 17 per cent expecting continued decreases in 2007.

Europe has less companies with increasing budgets than the US, and also has higher levels of pessimism about future increases.

Weaker economic environment causes uncertainty, can potentially delay investments in IT, and makes enterprises more hesitant to adopt the latest technologies, says Datamonitor analyst Tim Gower.

'However, with stronger economic growth forecast in 2006, this is likely to reduce the degree of caution in IT budget setting in Western Europe, making the enterprise environment marginally less challenging for technology vendors,' he said.

Hardware purchases are taking the majority of spending on both sides of the Atlantic, but plans for 2007 show money spent in the area will reduce while software, communications and consultancy expenditure are all expected rise.

Solutions that help enterprises cut costs, enhance efficiencies and achieve or maintain regulatory compliance will generate the most interest, Gower says.

'But vendors and services providers should always look to meet these requirements with their offerings,' he said.

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