McLean, VA - February 5, 2003 - FSI, the nation's preeminent supplier of actionable government-IT market intelligence, today announced its assessment of the Office of Management and Budget's (OMB's) expanded budget for IT spending by the federal government. The OMB's submission calls for $58.1 billion in federal-IT spending during fiscal 2003, $59.3 billion in fiscal 2004.

The boost in IT investment - 6.6 percent of federal discretionary spending in the original 2003 financial projection, 7.2 percent in the budget announced by the OMB yesterday - is weighted toward modernizing back-office systems rather than implementing leading-edge, front-office e-government.

FSI said that IT expenditures will be concentrated on what the OMB called "modernization blueprints," projects that produce more efficient and effective government by reducing operation and decision cycle times (shortening 30-day processes to less than one day, for example).

"Two years ago, we were talking about e-government and finding new ways to do business online," said James A. Kane, President and Chief Executive Officer of FSI. "Now we're hearing a slightly different story: The federal government is investing like it's a big business that must leverage technology to do the business of government better, faster and smarter."

Added Ray Bjorklund, Vice President, Market Intelligence, and Chief Knowledge Officer with FSI, "The projected increases in IT spending, during expectations of deficits, illustrates this administration's continuing commitment to using IT as a lever in achieving President Bush's management agenda. That said, it is equally clear that government agencies - and, therefore, their IT contractors - will have to work harder than ever to prove business cases for their proposed IT expenditures in order to gain funding."

OMB has received a total of 1,400 business cases with the 2004 budget submission. Of the 750 business cases currently being reviewed a large portion are characterized as being "at risk."

"While the OMB hopes to fix these at-risk business cases by October 2003, there are no guarantees," Kane said. "If an agency makes a good, strong business case for its IT project, the OMB will help look for the funding. But if the business case isn't solid -- even if Congress appropriates the funds -- no money will be made available. It has never been more true in the federal-IT marketplace that making the business case is good for business."

FedSources, a subsidiary of PRIMEDIA Inc., delivers fact-based, government-IT market intelligence to both the largest existing government contractors and new market entrants via online subscription services, tailored consulting and industry-leading events. These programs, underscored by a hands-on approach to client support, enable IT vendors and government organizations to make informed business decisions and experience rapid return on investment. FedSources was founded in 1984 and is headquartered in McLean, Virginia; its Web site is www.fedsources.com.