Forrester Research predicts slowed IT spending in 2008. According to the firm, the tightening of credit, mortgage foreclosures and eroding consumer confidence will slow the pace of IT spending, which the firm had initially pegged at about 8 percent growth. Instead, the company has revised its predictions to just 4.6 percent growth. IDC, another industry analyst, suggests that sector growth will fall between 5.5 percent and 6 percent for 2008.

Businesses will be reluctant to spend a lot on big-ticket computer and telecom items. Cisco and Hewlett Packard have already issued anemic predictions for revenues in 2008.

According to surveys done by Forrester, less than half of CIOs surveyed expect their budgets to increase, and one out of three expects their budgets to stay the same as it was in 2007. A survey done by InformationWeek produced almost identical results.

MGI research suggests that software-as-a-service vendors will be the hardest hit in a downturn, should one occur in 2008, although IDC predicts that more vendors will begin offering SaaS as an option to take advantage of Web 2.0.