Ipsos-Reid Joins CATAAlliance
February 14, 2006

Ottawa, Feb 14 2006 -- A new study on the state of Canada's IT community will be made available exclusively to CATAAlliance members and leadership network as part of a partnership with Ipsos-Reid, Canada's market intelligence leader. The company formally joined CATAAlliance today, it was announced.

The 11-page report, IT Business in Canada: 2006 Mid Market and Large Enterprise Opportunity, provides a sobering perspective of corporate demographics in Canada and valuable insight into actual and projected IT spend from leaders in each segment of the business community.

"We are very pleased to announce our joining with CATAAlliance and are equally as pleased to provide CATA members with this report," says Ipsos-Reid Vice President, Information Communications and Technology, Lise Dellazizzo. "Ipsos-Reid included 254 mid-and-large companies as well as an additional sample of 121 small businesses for this IT spend analysis. The report focuses on examining growth trends and spending patterns in the three major IT sectors - software, IT services, and hardware and infrastructure - and we're confident the findings will be of significant interest to every CATA member."

The report is, in fact, being offered not only to CATA members, but to any CATA stakeholder registered to our leadership network; comprised of over 22,000 business, government and academic leaders.

"Because of the richness of the findings and the key themes emerging from the research, we want to be sure this report is seen by the entire CATA community and not just the forward-thinking companies who have joined our ranks," says CATAAlliance VP Research, Kevin Wennekes. "One of the reasons Ipsos-Reid has joined CATA was based on our growth in and ability to advocate on behalf of the entire advanced technology sector and the openness in which we share our knowledge and resources. We want to be sure that this critical market intelligence is widely shared and Ipsos-Reid recognized for the significant value this study delivers."

The report can be requested through Ipsos-Reid by using the following link which has been uniquely created for CATAAlliance members and stakeholders: http://www.Ipsos-Reid.ca/reid/telecom/itvendor.cfm?members=CATA. Some highlights of the report are also provided in the Appendix of this release.

"I have long been an admirer of Ipsos-Reid and the quality work they produce," says CATAAlliance President, John Reid. "Having their support and guidance behind us as we move forward in our advocacy and outreach programs, and our own research initiatives, will be of immeasurable value. This unique, multi-year partnership has been custom tailored to clearly identify areas of key mutual support and allows us to focus on developing and implementing both short and long-term initiatives."

As a part of the two-year membership agreement, Ipsos-Reid, who has long been instrumental in the development of CATA's Global Sourcing Action Roadmap (http://www.cata.ca/Media_and_Events/Press_Releases/cata_pr10060501.html) will be continuing its assistance here in an official capacity as a member of the Steering Committee helping to drive the Action Roadmap forward.

The membership arrangement will also see Ipsos-Reid and CATA developing affinity programs for members, offering members unique invitations to participate in Ipsos-Reid research initiatives, and aligning resources in the delivery of unique information sessions and events.

About Ipsos-Reid Ipsos-Reid Reid is Canada's market intelligence leader and the country's leading provider of public opinion research. With operations in eight cities, Ipsos-Reid Reid employs more than 300 researcher professionals and support staff in Canada. The company has the biggest network of telephone call centres in Canada, as well as the largest pre-recruited household and on-line panels. Ipsos-Reid Reid's Canadian marketing research and public affairs practices are staffed with seasoned research consultants with extensive industry-specific backgrounds, offering the premier suite of research vehicles in Canada-including the Ipsos-Reid Trend Report, the leading source of public opinion in the country-all of which provide clients with actionable and relevant information. Ipsos-Reid Reid is an Ipsos-Reid company, a leading global survey-based market research group. To learn more, visit: http://www.Ipsos-Reid.ca

APPENDIX

A new Ipsos-Reid report examining IT growth trends and spending patterns shows that the total spend for 2006 is expected to reach $40.93 billion in Canada, down slightly from $41.35 billion in 2005. Spending among mid-sized companies is expected to decline by 4% overall, although this market is still the largest IT revenue-generating segment in Canada, accounting for $23.9 billion in 2005 and $22.9 billion in 2006. This drop in expected spending is the major factor influencing the lack of overall IT spend in 2006.

Overall projected spending in the large enterprise segment will increase by 7%, from $4.6 billion in 2005 to $4.9 billion in 2006. Low growth of 2% is expected in the small business segment from 2005 to 2006, bringing overall spend in this segment to $13 billion in 2006. A total of 375 companies were part of the second annual study.

Key Findings

  • IT spend will remain basically flat in 2006, staying close to the mark of $41.4 billion (all dollar amounts in Canadian funds) in 2005 and $41 billion in 2006 for the three major IT sectors represented in this report.
  • The mid market represents the most lucrative IT spend opportunity overall based on volume, average per company spend, and total spend generated.
  • The highest per company spend is still in the large enterprise segment, with a significant proportion focused in very large enterprises of 1000+ employees.
  • Average per-company spend in this sub segment outstrips per company spend in the mid market by a three to one margin.
  • There is a deceleration in mid market spend from 2005 to 2006, causing an overall decline of 4% in this segment. This significant drag is caused by a decline in hardware and infrastructure spends of 18% from 2005 to 2006. Software and services spend is slated to increase, partially offsetting the decline in hardware and infrastructure spend.
  • Seven percent growth is expected in the large enterprise segment. Most of this activity will be fuelled by an increase in software spend of 33%. Growth will be tempered by an overall decline in IT services spend of 6%.

Methodology

This Ipsos-Reid Reid research report is focused on examining growth trends and spending patterns in the mid and large enterprise sectors, using 2005 as a baseline year and examining IT budgeted spend for 2006. The three major IT sectors included in our analysis are software, IT services, and hardware and infrastructure.

Ipsos-Reid included 254 mid-and-large companies in its IT spend analysis. The large enterprise segment is well represented, comprising 39% of the total number of firms included in its sample. This market is segmented into two sub groups-one of firms with 500 to 999 employees, and one of firms with more than 1000 employees-to obtain further insight into the spending patterns of an important IT buyer market. An additional sample of 121 small businesses was included to develop the 2006 IT spending table, bringing the total number of companies included in our Canadian survey to 375.