Tech Sector Won't Return To '90s Glory Industry Settling Down Technology should look more like mature fields such as drugs, retailing.(A)

Byline: BRIAN DEAGON

The tech sector spent all of 2002 trying, and mostly failing, to recover from the knockout punch delivered in 2001. This year could determine whether the industry's go-go growth days are gone-gone.

Many observers say the tech industry has matured and will settle alongside many other big industries, such as drugs, retailing, publishing and transportation. In mature industries, there is still lots of opportunity for new companies to emerge. But the core growth of these industries is tethered to the global economy. Information technology is entering this phase, some analysts say.

"IT spending will begin to recover in 2003," said Hugh Bishop, an analyst at the Aberdeen Group research firm. "But the long-term growth rate will be less than experienced in the 1990s. We do not see a return to double-digit growth rates."

The elements that made technology in the 1990s one of the hottest sectors ever can't easily be repeated, researchers say. These elements included the Internet boom, spending on Y2K issues, huge sums of venture capital money flooding the market, widespread deployment of network and wireless infrastructure and a booming market for home PCs and cell phones.

Now, almost every business has a Web site, and just about every home that wants one has a PC and cell phone. The venture capital industry is retrenching -- investing about $5 billion a year vs. $100 billion in 2000. And after the Y2K and Internet spending binges, many companies ended up with more tech goods than they need.

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