The VAR Guy

April 23, 2008

1 Min Read
Memo to All: Nothing Is "Recession Proof"

It happened again: Another IT-related article declaring a specific technology industry segment “recession proof.” That’s a dangerous, misleading claim, The VAR Guy believes. Here’s why.

Certainly, some segments of the IT industry will hold up better than others during a weak or contracting economy. Software as a service (SaaS) and managed services are two strong areas that come to mind.

However, no segment of the IT market — not a single one — is truly immune to a recession, The VAR Guy insists. Some folks say a recession is actually “good news” for SaaS and managed services, because businesses will want to outsource more of their IT functions to those online partners.

But if a business is tanking — an extreme example: Bear Stearns — all of that outsourcing work goes away… completely!

So, the next time somebody tells you a market segment is “growing 25 percent” and is recession proof, consider this: Perhaps that market segment would have been growing even faster, had the economy been healthier.

Sorry for the rant. But the following headline set off The VAR Guy:

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