But Apple Boosts iPhone Share Among Businesses

The downturn in the U.S. economy is far from over. ChangeWave's latest IT purchasing survey shows an even greater pullback occurring in corporate spending - both for the current quarter so far and for the next 90 days going forward.

At the same time, the Apple iPhone is beginning to gain traction in the corporate marketplace even as RIM maintains a big market share lead.

The survey of 1,947 respondents involved with IT spending in their organization was conducted August 11-21.

First, we asked respondents if their 3rd Quarter IT spending was on track to date, and the results were the worst we've seen in a ChangeWave survey.

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Three-in-ten (30%) say they've spent "Less than Planned" - 3-pts worse than our May survey. Just 12% have spent "More than Planned."

Visibility Going Forward - A Picture of Negative Growth

Looking ahead, the results are correspondingly grim, with 29% saying their company's IT spending will decrease (or there will be no spending at all) in the 4th Quarter - 5-pts worse than the previous survey.

At the same time, just 13% say spending will increase - a drop of 2-pts from previously.

Thus, the brief period of stabilizing we picked up in May has given way to another major leg downward. In fact, you have to go way back to the middle of the last recession (August 2001) to find a ChangeWave survey projecting this big of an IT spending downturn.

Impact of High Energy Costs: Better than a third of corporate respondents (35%) reported high energy costs were affecting their company's IT spending plans for second half 2008, 1-pt worse than previously.

Impact of the Election: Almost as importantly, one-in-four respondents (25%) say the looming U.S. presidential election is having an impact on their company's IT spending decisions (5% Significant Impact, 8% Moderate and 12% Slight).

Bottom Line: Historically, ChangeWave's mid-quarter corporate IT spending survey has proven to be an accurate early indicator of how the quarter is actually going to turn out. The grim findings of the current survey indicate that the U.S. economic downturn is far from over - indeed, the findings indicate even rougher times lie ahead.

Not only are IT expenditures lower-than-expected thus far in the current 3rd Quarter, but visibility over the next 90 days shows no signs of improvement.

These survey results also lend strong support to the thesis that corporate America will continue to hold its powder dry in terms of IT capital investment - at least until after the November elections.

And perhaps longer.

When we asked respondents exactly when they thought IT spending would pick up in their company, a robust 39% said not until at least the 2nd Quarter of 2009 or later.

Corporate Smart Phones: Research In Motion Holds its Lead

In the same survey we also focused on corporate smart phone buying, and here Research In Motion (79%) continues to overshadow its two main competitors in terms of planned 4th Quarter purchases - but we note that it's down a full 3-pts from the record high it registered in May.

Note that that we also picked up weaker visibility for RIM in our most recent consumer smart phone survey (June 2008). Thus, at least momentarily, RIM appears to be confronted with visibility issues on both the consumer and corporate fronts.

While the success of RIM's upcoming new product launches could put most of these issues to rest, the first new RIM launch - the Bold - is still not yet available in the U.S. When you place this in the context of the current 'take no prisoners' stock market, RIM could be in for a bumpy ride with investors short term - until they have some proof that RIM's new products are being successfully brought to market.

Apple (17%), on the other hand, continues to show considerable momentum in terms of corporate planned purchases - up 4-pts from previously. In short, while recent ChangeWave consumer surveys have shown the 3G iPhone having a huge impact on consumer demand, the current results show the iPhone is beginning to gain real traction in the corporate market as well.

In yet another positive for Apple, 19% report the release of the 3G iPhone has made their company More Likely to purchase Apple products in the future - only 1% say Less Likely. Thus, the 3G iPhone release appears to be having a positive 'halo effect' in terms of improved overall corporate purchasing intentions for Apple products in general.

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