Education IT Spending, Fueled by Telecom, To Top $56 Billion by 2012

Higher ed accounts for 64 percent of all education IT spending

In the United States, IT spending in education will reach $47.7 billion by the end of this year and is expected to top $56 billion by 2012, according to a new report from Compass Intelligence, an IT consultancy and market research firm. This growth in education--both K-12 and higher ed--is being fueled in particular by expenditures in telecommunications, collaborative technologies, and outsourced IT services.

According to the new report, "Education Snapshot: Learning with Technology," the bulk of education IT spending is occurring in higher education--about 64 percent versus 36 percent in K-12. In 2008, telecommunications accounted for almost $16 billion of total education expenditures, but, according to Compass, this category will be outpaced by outsourced IT services over the next four years.

Stephanie Atkinson, managing partner and principal analyst for Compass Intelligence, told us in an e-mail interview, "Most of the spending is in telecommunications and applications. Applications is one of the fastest growing categories. This includes things such as learning content, student-teacher-admin portals, video applications, and more." She told us that shifts in IT spending in education are being impacted largely by "the younger generation entering into the education workforce, [who] are becoming increasing factors in terms of influencing the decision-making process for IT purchases."

Another large category for education in general, according to the report, is wireless technology. It's expected to account for $13 billion in education IT spending in 2008, or about 27 percent of the total forecast. More than half of higher education campuses are currently using wireless, and some 35 percent of total K-12 schools are using or are expected to be using wireless by the end of the year. This wireless explosion, in turn, is also fueling spending on security.

Internet and electronic learning tools will account for $9.1 billion in spending in 2008, which the report said is expected to grow to $12.9 billion by 2012.

The report also highlighted mobile computing as a growing category, a trend that's expected to continue for the next three to five years. According to information released by Compass Thursday, "When asked which mobile and Internet applications Education IT decision-makers plan to roll out within the next six months, collaboration applications ranked the highest."

Atkinson also cited virtualization as an important factor impacting IT spending, although virtualization was not quantified in the report. "It is becoming increasingly difficult to manage disparate IT systems, servers, and networks," Atkinson said. "Virtualization could be a crucial area to help improve these challenges. With bandwidth and security of IT systems becoming large priorities, virtualization can do nothing but improve IT management for schools and universities."

About the Author

David Nagel is the executive producer for 1105 Media's online K-12 and higher education publications and electronic newsletters. He can be reached at dnagel@1105media.com. He can now be followed on Twitter at http://twitter.com/THEJournalDave (K-12) or http://twitter.com/CampusTechDave (higher education). You can also connect with him on LinkedIn at http://www.linkedin.com/profile/view?id=10390192.

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