Defying an otherwise weak IT spending environment, Research In Motion (RIMM) is continuing to blow away the competition -- expanding on its already vast share of the corporate smart phone market.

Corporate IT spending is far less robust elsewhere, however. After a long and unsettling decline there are signs the spending slowdown may be stabilizing.

First, the good news from ChangeWave's May survey of 2,049 respondents involved with IT spending in their organization -- it's all about smart phones.

Research In Motion Destroys the Competition

In extraordinarily upbeat results for Research in Motion (76%; up 3-pts), the Canadian BlackBerry maker is expanding its already vast lead in the corporate smart phone market -- even as number two Palm (PALM; 17% - down 1-pt) continues its long term decline.

Moreover, when we look at future planned purchases for the 3rd Quarter, we see just how RIM absolutely dominates the overall corporate market. An astonishing 82% of respondents whose company plans to buy smart phones in the 3rd Quarter will buy BlackBerries -- a 5-pt jump since February.

The Apple iPhone (AAPL; 13%) now ranks second in terms of planned corporate purchases, up 2-pts from previously -- while Palm continues to languish with a miniscule 8% of future purchases.

Meanwhile, despite RIM's upbeat results in the smart phone market, overall corporate IT spending remains anemic and there are very few signs of an uptick going forward -- pointing to continued economic weakness for the 2nd half of the year.

We asked respondents if their overall IT spending was on track thus far in the 2nd Quarter, and 11% said their company had spent "More than Planned" -- up 1-pt since February. Another 27% say they've spent "Less than Planned" -- unchanged from previously.

As the chart shows, current IT spending remains at virtually the same lowered level it was in the previous quarter -- although it's a positive sign that things haven't gotten any worse.

Looking ahead to the 3rd Quarter, nearly one-in-four respondents (24%) say their company's IT spending will decrease (or there'll be no spending at all). That's 1-pt worse than the previous survey. In addition, only 15% say spending will increase -- unchanged from previously.

The softness in projected spending is occurring across companies of all sizes, although once again things have stopped getting worse -- another sign that things have at least temporarily begun to stabilize.

But the big question is -- when are things actually going to get better?

Bearish on the 2nd Half

We asked respondents about their IT spending outlook for the entire second half of 2008 (July-December), and 28% think their IT budget will be less than first half of 2008 -- a whopping 8-pts worse than previously.

Only 18% think their company's IT budget will be greater than it was in the first half of 2008. Another 44% say their IT budgets will remain the same.

Thus, while the slowdown in corporate IT spending may be finally stabilizing, these results point to continued economic weakness for the 2nd half of the year. At the very least, the ChangeWave findings provide little support for the thesis that a V-shaped U.S. economic recovery will occur in the 3rd Quarter. Rather, they strongly suggest that businesses will continue to maintain a wait and see mode regarding capital spending -- possibly until the November elections.

Research In Motion's success in the smart phone market, however, remains one extraordinary bright spot in the IT economy. The BlackBerry smart phone maker appears likely to enjoy one of its best quarters ever.

To stay up-to-date on ChangeWave's upcoming corporate IT spending and smart phone findings, simply click here.

Jim Woods co-wrote this article.


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--Smart Phone Wars: Apple vs. RIM vs. ...the Android Operating System? (4/1/08)
--RIM Dominates the Corporate Smart Phone Market (2/26/08)
--Corporate IT Spending Goes Negative (2/25/08)