Small increase in global IT spending predicted

Worldwide spending on IT is expected to increase by 2.4 per cent in 2015, totalling $3.8 trillion (£2.5 trillion) but this is lower than previous forecasts, according to a report from Gartner.

Initial projections were of 3.9 per cent growth, but the reduced estimate is due to the rising value of the US dollar as well as a small reduction in growth expectations for devices, IT services and telecom services, the Gartner Worldwide IT Spending Forecast stated.

“The change in forecast is less dramatic than it might at first seem,” said John-David Lovelock, research vice president at Gartner. “The rising US dollar is chiefly responsible for the change – in constant currency terms the downward revision is only 0.1 per cent. Stripping out the impact of exchange rate movements, the corresponding constant-currency growth figure is 3.7 per cent, which compares with 3.8 per cent in the previous quarter’s forecast.”

The forecast, which analyses sales of thousands of vendors of IT hardware, software and services, highlighted growth in the areas of data centre systems, enterprise software and telecoms services.

A higher-than-anticipated switch to cloud-based services and extensions in replacement life cycles is thought to be behind an increase in demand for enterprise communication applications and enterprise network equipment.

Declines were predicted in devices such as PCs, mobile phones and tablets, and IT services, predicted to be the result of an increasingly polarised market between high-end and low-end price points for smartphones.

Lower growth rates expected for enterprise software are expected to contribute to a lower outlook, causing reductions to software support services.

More price erosion and vendor consolidation is expected in the enterprise software market because of fierce competition between cloud and on-premises software providers, the report predicted.

(Source: http://www.supplymanagement.com/news/2015/small-increase-in-global-it-spending-predicted#sthash.SNF5Z2la.dpuf)