C4I Sector Adjusts to Life After the 9/11 Buildup

(Newtown, Conn., March 27, 2008) -- The C4I market peaked in 2008, reports Forecast International's "C4I Market Overview." Richard Sterk, Senior Analyst at Forecast International, comments, "The world C4I market is now in the beginning of the predicted 'market correction' with the completion of many 9/11-inspired programs and efforts."

The "C4I Market Overview" examines over 200 leading programs and some 25 companies that are expected to produce at least $64.1 billion in market value over the next 10 years. The programs examined are expected to be worth $11.645 billion in 2008, and then steadily decline in value to $3.384 billion in 2017. This drop is not unexpected, as it represents the end of the initial response to the 9/11 terrorist attacks that flooded money into defense and homeland security programs with the hope of immediate, short-term fixes.

"Another effect of the 9/11 acceleration has been the creation of a market void in new technology development for the next few years," said Sterk, in explaining that technology development is usually spaced evenly to allow for both technological maturity and funding. However, in order to pay for the accelerated program efforts that were originally not budgeted for, defense departments basically had to borrow from future spending. "Many new R&D efforts were placed on hold, Sterk said. "Unfortunately," he added, "now that they are set to go again, the money to fund them has already been spent."

Of the companies examined in the analysis, Raytheon, General Dynamics, AGS Industries, Northrop Grumman, and Thales are projected to be the top five C4I defense companies over the next 10 years based on forecast sales volume and percentage of market share.

Source : Forecast International Inc.

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