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EIA FORECASTS FEDERAL INFORMATION SYSTEMS MARKET TO GROW SLIGHTLY THROUGH FY 1998

 WASHINGTON, Sept. 20 /PRNewswire/ -- The federal information systems market will grow approximately 1 percent annually in real terms for FY 1993 through FY 1998 according to the Electronic Industries Association's (EIA) Five-Year Forecast of Federal Information Systems. This EIA forecast is based upon data received from more than 40 offices and was released and presented to a record crowd at the Government Division's fifth annual Federal Information Systems (FIS) Conference on Sept. 20-21 at the Omni Shoreham Hotel, 2500 Calvert St. N.W., Washington.
 "Information technology funding for the civil sector will increase approximately 3.2 percent annually in real growth over the forecast period, while Department of Defense (DoD) funding for information technology will decline at a rate of -2.7 percent annually," said George Shaw, director of strategic planning for Hughes Information Technology Company, Reston, Va., and chairman of the EIA Five-Year Forecast study team.
 According to Shaw: "The minimal real growth in the federal information technology market is a result of a balance of positive and negative factors. Among the positive factors, there is a significant pent-up demand for information technology requirements because computers and telecommunications networks help agencies stretch their budgets. In addition, the Corporate Information Management (CIM) initiative is changing how DoD does business and this will present opportunities for industry. Meanwhile, initiatives of the new administration such as health care reform and reinventing government are likely to significantly change the nature of information technology and present new market opportunities for contractors. Finally, the portion of information technology obligations available to industry continues to increase," explained Shaw.
 "On the other hand," Shaw continued, "the continuing specter of large federal deficits is squeezing discretionary spending for all federal agencies. This constriction is impacting information technology for the defense and civil sectors. This is seen in the relatively small growth reported in the FY 1994 budgets. Force reductions and consolidation of facilities are reducing information technology obligations within DoD. The significant number of program slippages is reducing the obligations for information technology in many federal agencies.
 "The largest three agencies for federal information systems spending will shift significantly over the next five years. The three DoD services have the largest information technology budgets in FY 1993. By the end of the forecast period the Departments of Transportation and Treasury, as well as NASA, will have the largest budgets for information technology," said Shaw.
 "The portion of the federal information technology market that is contracted out will continue to grow, creating new opportunities for industry," Shaw concluded.
 The conference chairman was Tom Milbourne, director of studies and analysis for government and international operations for E-Systems, Fairfax, Va.
 The EIA Five-Year Forecast of the federal information technology market reviews budget trends and programs as well as analyzes more than 40 civil and defense offices. The forecast and other analyses were developed by EIA member companies and supported by extensive research and over 125 interviews with senior-level officials from the Office of Management and Budget, Department of Defense, civil agencies, Congress and investment firms.
 Civil Opportunities
 The civil agency sector of the federal information systems market will present exciting opportunities over the next five years. Such opportunities will be fueled by challenges to improve Service to the Citizen, Reinventing Government, implementing a National Information Infrastructure, and the potentially wide impact of Health Care Reform. The study also showed that budget constraints will force interagency cooperation and coordination on major information technology initiatives. The need for greater computer and data security was echoed across a myriad of civil agencies.
 Shift in Telecommunications
 Emerging trends in federal telecommunications usage within several large agencies are consuming available bandwidth and tending to blur the distinction between the artificial walls that once existed among the various commercial and government networks. Shared switching technologies, virtual networks and shared facilities enable new economies of scale and make "Bandwidth on Demand" services a reality in the near future. The emerging trend is from a mainframe -- centric to data -- centric environment where distributed data base applications are increasingly geographically dispersed. Heightened governmental interest in security, privacy, and wireless technologies are also covered in the report. The Telecommunications Market Study was lead by Dr. Chuck Alvord, director, civilian agency programs, for Boeing Computer Services, Vienna, Va.
 Federal agencies' interest in new telecommunications technology stems from broader interest in network flexibility and reliability and emerging applications that are becoming increasingly inter-agency oriented. Several new network integration opportunities are synopsized in the EIA Telecommunications study covering both the defense and civil sectors. The federal telecommunications market continues to be one of the more enticing segments of a growing, modern information technology field.
 For additional information contact Mary Lamb of EIA at 202-457-4943. The final report from the conference will be available in November. To order a copy of the report, contact Kelly Curtis at 202-457-8748. Cost: EIA Government Division Member Companies $125, non-member companies $250.
 For more than 69 years, the Electronic Industries Association has been the national trade organization representing the U.S. electronics manufacturers. Committed to the competitiveness of the American producer, EIA represents the entire spectrum of companies involved in the manufacture of electronic components, parts, systems and equipment for communications, industrial, government and consumer-end uses.
 -0- 9/20/93
 /CONTACT: Mark V. Rosenker, vice president, public affairs, Electronic Industries Association, 202-457-4980/


CO: Electronic Industries Association ST: District of Columbia IN: CPR SU:

MH-IH -- DC011 -- 3583 09/20/93 10:51 EDT
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Date:Sep 20, 1993
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