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IT Opportunities in State and Local GovernmentProduct Type: Market Research ReportPublished by: Datamonitor Published: July 2005 Product Code: R313-11823 Description IntroductionDriven by pressure to improve constituent services, reduce costs and develop efficiency, US state and local governments are increasing their technology spending. Changes in internal structure and constituent service delivery including increasing federal funds, consolidation of IT management, and deepening of e-government will lead to even greater opportunities for IT vendors in this market. Scope Forecast of total IT spending and vendor opportunities for FY2004 to FY2009 by government function and technology segment Sizing of market in both state and local government Identification of trends emerging in state and local government IT market Profiles of select systems integrators serving this market Highlights Total state and local government IT spending will grow from $55.0B to $62.4B from FY2004-09. Spending will shift away from hardware and networking towards software and services. Reasons include falling hardware prices, loss of workforce to retirement and growing interest in e-government and enterprise-wide systems. Datamonitor has identified public safety, health & human services, general government and transportation as the top functional areas for IT investment by state and local governments. Reasons to Purchase Evaluate opportunities in the state and local government technology market by government function and technology segments Compare opportunities in both state and local government Identify competitors and potential areas for partnerships in the state and local government IT market Table of Contents TABLE OF CONTENTSCHAPTER 1 EXECUTIVE SUMMARY 3 Introduction 3 Market context 3 Customer focus 4 Action points 5 CHAPTER 2 INTRODUCTION 12 What is this report about? 12 Who is the target reader? 13 How to use this report 13 CHAPTER 3 MARKET CONTEXT 14 Introduction 14 Key findings 14 State and local government technology budget analysis 17 Spending by technology segment: state and local government will shift spending towards services and software 18 Spending by function: state and local governments place top priority on public safety 20 Spending by level of government: state vs local 23 Technology spending by state governments 23 Spending by state: population is not the only determinant of government IT spending 26 Spending by technology segment: state government technology mix will shift towards software and services 27 Spending by function: state governments focus on health and human services 29 Technology spending by local governments 32 Spending by technology segment: local government spending on services and software is growing 34 Spending by function: public safety is primary recipient in local government 37 Trends in state and local government IT spending 39 Renewed interest in consolidation 40 Increasing influence over technology decision-making 42 Taking e-government to the next level 43 Changing role of federal funds 45 CHAPTER 4 COMPETITIVE DYNAMICS 48 Introduction 48 Key findings 48 Overview of vendors 49 Profiles of select systems integrators in the US state and local government market 50 State- and local-focused IT vendors rank highly in market: ACS, CGI-AMS, Maximus 50 Broad IT services firms have mixed results: EDS, IBM, Unisys 53 Federal contractors are expanding state and local offerings: Lockheed Martin, Northrop Grumman 55 Consulting firms racing into state and local government market: Accenture, BearingPoint 57 CHAPTER 5 ACTION POINTS 60 Introduction 60 Follow the federal money 60 Investigate new sources of funding 60 Seek out regional projects, but be prepared for more upfront evaluation 61 Focus on small-scale outsourcing at the local level 61 Be willing to enter partnerships either as the prime or the sub 62 CHAPTER 6 APPENDIX 63 Research methodology 63 References 63 Related readings 64 SPP writing team 64 How to contact experts in your industry 66 LIST OF TABLES Table 1: US state and local government IT vendor opportunity by technology segment, FY2004-FY2009 ($M) 19 Table 2: US state and local government IT spending by function, FY2004-FY2009 ($M) 22 Table 3: US state government IT vendor opportunity by technology segment, FY2004-FY2009 ($M) 28 Table 4: US state government IT spending by function, FY2004-FY2009 ($M) 30 Table 5: US local government IT vendor opportunity by technology segment, FY2004-FY2009 ($M) 35 Table 6: US local government IT spending by function, FY2004-FY2009 ($M) 38 LIST OF FIGURES Figure 1: US state and local government IT spending: vendor opportunity vs internal spending, FY2004-FY2009 ($B) 18 Figure 2: US state and local government IT vendor opportunity by technology segment, FY2004-FY2009 ($B) 19 Figure 3: US state and local government IT spending by function, FY2004 21 Figure 4: US state government IT spending by technology segment, FY2004 24 Figure 5: US state government IT spending by technology segment, FY2009 24 Figure 6: US state government IT spending: vendor opportunity vs total spending, FY2004-FY2009 ($B) 25 Figure 7: US state government IT vendor opportunity by technology segment, FY2004-FY2009 (% of total) 27 Figure 8: US state government IT spending by function, FY2004 30 Figure 9: US local government IT spending by technology segment, FY2004 32 Figure 10: US local government IT spending by technology segment, FY2009 33 Figure 11: US local government IT vendor opportunity by technology segment, FY2004-FY2009 ($M) 34 Figure 12: US local government IT spending by function, FY2004 37 Figure 13: State agencies are mainly influenced by the state itself, while local agencies feel influence from multiple sources 43 Figure 14: State and local agencies expect to receive federal funds for public safety projects 45 |
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