IT departments must align their spending with CIO priorities, avoid vendor led upgrades and explore fully the cost versus benefits of unified communications.

So says Gartner analyst Bob Hafner who believes businesses risk wasting a staggering £65bn in the next five years on poor network equipment buying decisions.

Examples of waste range from throwing away £10bn on high specification IP phones with screens for all staff, when simple handsets will do for most, to wasting £5bn by unnecessarily running Gigabit Ethernet to every desktop in an organization.

Hafner and his colleagues believe that organisations around the world could save a total of £10bn by using WAN optimization products to boost bandwidth.

Such technologies can achieve reductions in network traffic of at least 60%, the analyst believes, delaying bandwidth upgrades for almost three years.

Making the network more reliable by taking full advantage of the Internet as an alternative to private services could generate another £17.5bn in savings.

In an individual company "these are not huge dollars," Hafner said, "but they all add up."

"It's paying $35 to $50 more per Ethernet port, it's paying $75 to $100 for a Gigabit phone and then paying an up to $300 extra for one with a big screen on it."

He estimates an organization could save 10% of its network spending by moving to the Internet from private WAN services. "In an organisation that spends $10 million on network services that's $1 million a year."

"You're probably are going to still spend the money (saved), but spend it on things that are of more value to you," such as network automation.

According to Gartner estimates companies will pay an extra 20 to 50% for technology features they'll never use through to 2011.