The health of the Australian tech sector fell 8.2 points in Q4 2008 and continued to recede from its record high in Q4 2007 which peaked at 154.5.  Losses were focused most heavily in the vendor strength indices which capture measures of vendor financials and employment capacity. Although Australian ICT trade maintained a steady growth, a 39 point drop in vendor strength contributed to drive the primary Tech Index down. For the coming quarter, the Australian tech sector faces an even grimmer outlook. The first longitudinal quarterly review of CIO confidence indicates a 25 percent drop from those executives who consider the Australian tech sector will attain positive growth. The normalised CIO confidence data forecasts a further collapse between 9.5 points (pessimistically) to 4.7 points (optimistically) in Q1 2009. Negative sentiment in the technology sector will continue to bleed into the index next quarter as trade statistics signal the heaviest falls since the dotcom bubble burst in 2001.