There have recently been a couple of useful indicators of the health of the technology industry. A somewhat lagging indicator is the new Software 500
list, which shows 2004 revenues, but for reasons best known to itself comes out in September. This shows overall revenues up 16% in 2004 compared to 2003. The software 500 is a slightly odd list in that includes assorted technology companie and systems integrators like Accenture rather than just pure play software companies, but it is otherwise a useful list. More recently, the FT reported that M&A activity in the European technology industry was at a record high, even more than in the previous record Q1 2000 quarter - there have now been ten straight quarters of M&A growth. This would suggest that, while the IPO market remains lacklustre unless you are called Google or have "China" in your name (just 64 technology POIs in the first nine months of 2005 v 367 in the same period in 2000) , the executives in the industry itself see opportunities in investing in technology companies, or at least see some bargains on offer.
These are welcome signs after the nuclear winter for technology of late 2001 and 2002, with 2003 only a little better. Customer IT spending is still frugal compared to the late 1990s, but at least some projects are now getting financed. Technology executives will hope to see conditions continue to improve after some lean years.