Hopes for high-tech market pick up

FRANKFURT, Germany -- While the number of exhibitors at CeBIT, the world's biggest high-tech fair, is down somewhat this year, there is finally optimism about palpable growth in the industry.

"It would be nonsense to assume it's back to double-digit growth," said Charles Homs, a senior analyst with research firm Forrester in Amsterdam. "It's not a high growth market any more."

Instead, companies selling the range of tech gear -- servers, routers, laptops, mobile phones -- will likely face an environment with "long-term, sustainable growth, the same as it is for any other industry," Homs said.

Forrester predicts overall spending on information and communication technology will rise 2.6 percent this year in four major European economies -- Germany, France, the United Kingdom and the Netherlands -- and 2.9 percent in 2005.

That compares with 0.8 percent last year and .77 percent in 2002 across hardware, software, services and telecommunications.

The organizers of CeBIT, which kicks off today in Hanover, expect 6,411 exhibitors, off 191 from last year and well below 8,100 in 2001.

Some of this year's decrease, however, appears to come from the sluggish German economy, because the number of foreign exhibitors actually rose by 116 to 2,992.

This year's hot topics include the coming start of speedy mobile phone data services, available already on a limited scale in several European countries and expected to accelerate toward the end of this year after several years of delay.

Attention is also on Radio Frequency Identification, with major retailers in the United States and Europe beginning to embrace RFID chips for tracking pallets and cases in their supply chains.

Some of the early expectations about the technology are easing amid consumer concerns the chips could be used to track them without their knowledge, and predictions that the chips will remain too expensive to be included on individual store items.

Company presentations for the media start today at CeBIT. Chancellor Gerhard Schroeder will formally open the weeklong show on Thursday.

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