Information technology costs gobbled up about 21% of investment firms total budgets in 1998 4% higher than projected, according to a report prepared by TowerGroup for the Securities Industry Association. Information technology leaders estimated in 1996 that the cost of expanding Internet, intranet and other networking services would require 17% of the firms total budget by 2000, according to the report. Total information technology spending increased to $18.4 billion in 1998 from $11.5 billion in 1996. Total spending on information technology is expected to increase 7% per year to exceed $24 billion in 2002, the report said. The cost surge is being driven by a demand for online trading.