1. www.idc.com State of the Market IT Spending Directions 2004-2008 Stephen Minton Vice President IDC Worldwide IT Markets

2. State of the Market Recovery remains on course according to previous conservative expectations Business leaders remain cautious; spending focused on infrastructure upgrades, some new projects Wild cards : Oil, Global Economy, Exchange Rates Tax incentives could spur US demand in Q4; but impact likely outweighed by other factors Hot CIO focus areas : Infrastructure, Security, CRM, WLAN, Business Intelligence New shift to “Dynamic IT” adoption and utilization

3. Worldwide IT Spending Growth % Growth Source: IDC Black Book Q3 2004

4. IT Spending Growth by Region Source: IDC Black Book Preliminary Q3 2004

5. Market Growth Forecasts, Q3 2004 Source: IDC Black Book Q3 2004

6. Likelihood of IT Budget Increases Source: IDC Market Watch Index, Q3 2003 – Q3 2004

7. Drivers for Increased IT Spending Source: IDC Market Watch Survey Q3 2004

8. Main Focus for IT Department Source: IDC Market Watch Survey Q3 2004

9. Yesterday’s Network

10. Today’s Network

11. Tomorrow’s Network

12. Complexity of systems/architectures

13. End-users start asking difficult questions IT Doesn’t Matter Nicholas Carr Harvard Business Review May 2003

14. Enterprises have always been Dynamic… Dynamic IT Capability Human Capital Customer Care Store/Branch Ops Performance Management Sales & Marketing Supply Chain Innovation/PLM Production

15. Dynamic Enterprises Needs Dynamic IT Dynamic IT Capability Human Capital Customer Care Store/Branch Ops Performance Management Sales & Marketing Supply Chain Innovation/PLM Production

16. Where to Start? – Business Execs’ Priorities for Dynamic IT Source: IDC’s LOB Executive Survey, June 2004 Q: Most important IT improvements to better support business? ¥£ € $

17. Two focus areas for Dynamic IT transformation Business Strategy Automation & Execution Responsiveness to Market IT Operations Automation & Management Operational Efficiency End-to-End, Dynamic Management Business Monitoring & Analytics Business Process & Application Automation Information and Data Services Integration, Event & Deployment Services Collaboration & Communication Services Access & Interface Services Service Level Management & Automation Metering, Measurement & Charge-back Security Infrastructure Virtualization Infrastructure Provisioning Resource Management & Monitoring Platform Management & Monitoring

18. Piecing Together the Big Picture Business leaders are still nervous — must play to cost- conscious market with appropriate message IT spending growth will continue to recover with overall economy and business investment, but users are focused on key priorities / dynamic IT IT spending will be evaluated throughout the year, wild card factors could disrupt outlook