Global IT spending to hit $3.8tn this year

Global spending in the IT sector will hit US$3.8 trillion in 2014, displaying 3.1 per cent growth on last year’s figures, according to IT research analysts Gartner.

While in 2013 the market was flat, growing only 0.4 per cent on 2012 with total global spending at US$3.7 trillion, Gartner forecasts much stronger growth across the coming year.

Growth will be led by enterprise software spending, which will see 6.8 per cent growth reaching US$320 billion, fuelled by a spike in demand for customer relationship management and supply chain management systems.

Spending on IT services is also expected to grow by 4.5 per cent to US$963 billion, as compared to 2013 growth of only 1.8 per cent.

“Investment is coming from exploiting analytics to make B2C processes more efficient and improve customer marketing efforts. Investment will also be aligned to B2B analytics, particularly in the SCM space, where annual spending is expected to grow 10.6 per cent in 2014,” said Richard Gordon, managing vice president at Gartner.

“The focus is on enhancing the customer experience throughout the presales, sales and post sales processes.”

According to Gartner, spending on devices will hit back in 2014, following a 1.2 per cent decline in 2013, with predicted growth of 4.3 per cent over the coming year to hit US$697 billion in devices spending.

Gartner had in the fourth quarter of 2013 predicted a slightly higher growth rate for 2014, forecasting 3.6 per cent – as opposed to 3.1 per cent – growth in global spending.

However, Gordon explains a cut to growth forecasts was necessary due to changing patterns in telecommunications services globally, leading to a weaker growth prediction in this sector than previously expected.

“A downward revision of the 2014 forecast growth in spending for telecom services — a segment that accounts for more than 40 percent of total IT spending — from 1.9 percent to 1.2 percent is the main reason behind this overall IT spending growth reduction,” said Gordon.

“A number of factors are involved, including the faster-than-expected growth of wireless-only households, declining voice rates in China and a more frugal usage pattern among European customers. The latter coincides in Western Europe with a breakout of fierce price competition among communications service providers to retain customers and attract new ones.”

Predictions for data centre systems spending has also been cut from 2.9 per cent to 2.6 per cent for 2014 contributing to the overall downward revision.

Image courtesy of Shutterstock.

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