IT Leaders Optimistic Heading Into 2004: Page 2 of 3

Tech Data chairman and CEO Steve Raymund told attendees that the shift from channel sales to direct sales among vendors has stabilized, which has been a major concern for the distribution market this year. In fact, Raymund said Tech Data's HP sales, which represents the largest portion of the distributor's business, have increased.

Raymund also said his company has benefited from consolidation in the distribution market, such as the exit of Daisytek to Chapter 11 and HP's decision to reduce its number of distribution partners in Europe. As a result, Raymund said, Tech Data is looking at making more acquisitions in 2004. "We're kicking lots of tires out there," he said.

The world's largest PC company weighed in on the economy as well. Dell CFO Jim Schneider said IT demand is picking up, as displayed by Dell's impressive PC sales, and that the economic environment is much more positive than it's been in some time. "We do see the market improving," Schneider said. "We've seen five consecutive quarters where we are seeing reasonable year-over-year growth."

Schneider said that notebooks, which typically have higher margins, are replacing desktops, a view shared by distributors and customers alike attending the conference, such as Ingram Micro. However, Schnieder said he would like to see several quarters of growth before declaring the upturn is here to stay.

A keynote panel moderated by CMP Media's Technology Solutions Group president Robert Faletra discussed emerging trends for IT spending. Ron Melnyk, CIO of Kasper, a New York-based company that produces the Ann Klein brand of apparel and retail shops, said that his company is replacing aging desktop PCs with notebooks. "The mix is changing; we are moving a lot more toward laptops and mobile computing," Melnyk said.