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Global IT spending to rise 5.1% in 2011

Gartner increases growth predictions upward for worldwide IT spending

Gartner says it expects stronger growth in worldwide IT spending than previously forecast.
Gartner says it expects stronger growth in worldwide IT spending than previously forecast.

Gartner is predicting that worldwide IT spending will increase by 5.1% during 2011.

The analyst company said that it believes the global IT market will reach $3.6 trillion this year, up from $3.4 trillion in 2010.

The figure is a revision of the company's previous forecast of 3.4% growth, after the IT industry had a better than expected year last year. Gartner had predicted 3.2% growth in 2010, but the market achieved 5.4% growth.

Gartner analysts said currency exchange rate fluctuations have continued to affect the US dollar-denominated forecast, with 1.6% of the 2.2% point increase in IT spending growth in 2010 attributable to the recent devaluation of the dollar against other currencies.

Richard Gordon, research vice president at Gartner, commented: "Aided by favourable US dollar exchange rates, global IT spending growth is expected to exceed 5% in 2010, but a similar level of growth in 2011 - while forecast - is far from certain, given continued macroeconomic uncertainty.

"While the global economic situation is improving, the recovery is slow and hampered by a sluggish growth outlook in the important mature economies of the US and Western Europe. There are also growing concerns about the ability of key emerging economies to sustain relatively high growth rates. Nevertheless, as well as a fundamental enabler of cost reduction and cost optimization, investment in IT is seen increasingly as an important element in business growth strategies. As the global economy repairs itself in coming years, we are optimistic about continued healthy spending on IT."

Gartner expects the telecoms equipment market to show strongest growth this year, up 9.1% off the back of strong mobile device sales last year, with growth in smartphones in mature markets and white box devices in emerging markets.

The computing hardware segment is likely to face challenges in PC sales, given the weak economic situation in the first half of 2011, although it is still predicted to grow by 7.5% in 2011.