Last week, we announced our Q3 2009 OnForce Services Marketplace Index (OSMI.)  As I looked into the numbers, I noticed some promising signs for the services market. The OnForce marketplace experienced cost stabilization across IT and CE service work for the second quarter in a row. This fact, along with industry reports, indicates that the economy is making a slow return to stabilization and ultimately to growth.  The other finding that I noticed which keeps me hopeful is that installation service work increased slightly in the third quarter. While I am cautious to say we are at the end of this economic downturn, it is safe to say that IT spending may be on the road to recovery. In the next quarter I expect this trend to continue as VARs start to conduct more project work and product refreshes.

Not only is the OSMI for Q3 encouraging, I feel it is inline with what we are seeing with the rest of the economy.  Overall, there have been positive signs in the technology and services technology industries that lead me to believe a slow revitalization is coming our way.  In recent months, Apple has recorded two historical quarters; IBM’s earnings climbed for the third quarter; Hoover’s reported the first triple digit percentage increase in new IPOs in August; and two hardware companies (Dell and Xerox) made service organization acquisitions, proving that service work is where they can create new revenue streams.

Is the worst behind us? Most likely.  But there is still some work to do and I believe we are currently in a technology reset. This reset will continue for some time and we will not be out of it for another nine – twelve months.  During this period, companies will maintain the equipment they can, but will start to loosen their grips and install equipment that absolutely needs to be replaced.

While there is no crystal ball, I think the economy will continue to see small upticks and positive news in the upcoming quarters.  Let me know if you agree.

This entry was posted on Monday, October 26th, 2009 at 5:00 pm and is filed under Marketplace Trends. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.