Enterprises plan to increase IT spending by 3.9 percent in 2005, according to a new survey of 1,368 IT decision-makers at North American and European enterprises from Forrester Research, Inc. It affirms the 7 percent increase in overall North American IT spending that Forrester projects for 2005, which includes spending by small and medium businesses, as well as spending outside IT departments. Fifty-four percent of the executives polled have a positive outlook for their business in 2005, compared with 44 percent last year. Business services, financial services, and insurance were the most optimistic industries. Public sector organizations are increasing IT spending by 7 percent in 2005, compared with a decrease last year. Applications are the big winner for budgets in 2005. Fifty-nine percent of decision-makers surveyed identified deployment or upgrade of major packaged applications as a priority, replacing security as the top priority from the past year. Thirty-eight percent of decision-makers consider support for governance, such as Sarbanes-Oxley, a critical priority, while 65 percent said it was a priority. Demand for business intelligence (BI) increases 9 percent. Content management could be the next “killer app.” Purchase plans for content management increased 15 percentage points from last year, as firms adopt enterprise-wide strategies for managing Web content, documents, records, and digital assets.