It Took Five Years, But Tech Spending Returning To 2000 Levels; Solid, Not Spectacular, Growth; 2005 shaping up as just the second time worldwide IT spending tops $1 trillion.(INTERNET & TECHNOLOGY)

Byline: BRIAN DEAGON

Business spending on technology for the rest of this year will likely continue the pace of the first half. That means final figures will hit the $1 trillion mark for only the second time, joining the peak bubble year of 2000.

But reaching $1 trillion won't cause analysts to pop the champagne. It simply means spending on information technology is back to where things left off five years ago. Growth is pegged at about 5%-7%, and will likely stay at the level for some time, analysts say. That's tame compared with the double-digit growth of the 1990s, but still solid.

"It's enough to support a large stable of tech companies, though it will also force more consolidation," said Stephen Minton, an analyst at International Data Corp. "The industry is more mature. Certain sectors have reached levels of saturation."

IDC says global tech spending will top $1 trillion, up 6% from 2004, and slightly surpass 2000. It sees the U.S. portion at $417 billion.

Unexpected changes in the economy, a dollar crisis or rising energy and interest rates could slow growth. Still, a report to be released Monday suggests optimism.

The monthly CIO Magazine Tech Poll says chief information officers expect tech budgets will grow 10% over the next 12 months. That's the highest growth since April 2001, and up from 6% the prior month.