Global IT spend to reach $3.8trn this year

Gartner predicts worldwide growth of 2.4% in 2015.

Tags: Gartner Inc. (www.gartner.com/technology/home.jsp)
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Global IT spend to reach $3.8trn this year Gartner's forecast was down on its earlier projections, which foresaw 3.9% growth during 2015
By  Tom Paye Published  January 13, 2015

Worldwide IT spending looks set to total $3.8tr in 2015, marking a 2.4% increase over 2014, according to the latest predictions from Gartner.

While the outlook seems rosy on the face of it, Gartner cautioned that this forecast was down on its earlier projections, which foresaw 3.9% growth during 2015. The slow outlook, Gartner said, was largely attributed to the rising US dollar, as well as a modest reduction in the growth expectations for devices, IT services and telecom services.

"The change in forecast is less dramatic than it might at first seem. The rising US dollar is chiefly responsible for the change - in constant currency terms the downward revision is only 0.1%," said John-David Lovelock, research vice president at Gartner.

"Stripping out the impact of exchange rate movements, the corresponding constant-currency growth figure is 3.7%, which compares with 3.8% in the previous quarter's forecast."

The US dollar spending growth rate on devices for 2015 was decreased by 1.3 percentage points to 5.1%. The smartphone market is becoming polarised between the high- and low-end market price points, Gartner said.  

Meanwhile, Gartner explained that data centre systems spending is projected to reach $143b in 2015, a 1.8% increase from 2014. Growth for the enterprise communications applications and enterprise network equipment segments of the market have been increased from the previous quarter's forecast, while growth for the servers and external controller-based storage segments has been lowered. These growth fluctuations are due to extensions in replacement life cycles and a higher than previously anticipated switch to cloud-based services, Gartner said.

In the enterprise software market, the research house projected that spending is on pace to total $335b, a 5.5% increase from 2014. More price erosion and vendor consolidation is expected in 2015 because of fierce competition between cloud and on-premises software providers. In particular, in the customer relationship management (CRM) market, a key cloud battleground, seat prices for segments such as sales force automation (SFA) are expected to decline by 25% through 2018.

And the outlook for IT services in 2015 has been reduced to 2.5% growth, down from the 4.1% growth forecast in the previous quarter. Globally, reductions to software support services contributed disproportionately to a lower outlook through 2018, because of lower growth rates expected for enterprise software, Gartner said.

Finally, Gartner projected that telecom services spending is projected to grow 0.7% in 2015, with spending reaching $1.6tr. The research house said that a multitude of factors have affected each national market - some positive, others negative - with the primary driver for growth being a reduction in expectations for mobile voice revenue across several markets.

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