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IT spending stops growing Featured

Total worldwide spending on IT will total US $3.7 trillion this year, a miniscule 2% increase from last year.

Given population growth and inflation, that means IT spend is not growing at all. But at least it is not falling. The figures are from industry watchers Gartner, in its quarterly worldwide IT spending forecast update.

In this latest forecast, expected growth for 2013 has been revised downwards from 4.1 % to 2%. In Australia, total IT spending is forecast to reach $75.3 billion in 2013, up 2.9% over 2012. This figure is made up of:

  • IT services: $28.7 billion
  • Telecommunications services (fixed, mobile and data): $26.7 billion
  • Devices (mobile phones, PCs, printers):  $10.7 billion
  • Software: $6.9 billion
  • Data centre systems (including servers, storage, network equipment): $2.3 billion

Gartner’s Worldwide IT Spending Forecast tracks expenditure across the hardware, software, IT services and telecom markets.

"Exchange rate movements, and a reduction in our 2013 forecast for devices, account for the bulk of the downward revision of the 2013 growth," said Richard Gordon, managing vice president at Gartner. "Regionally, 2013 constant-currency spending growth in most regions has been lowered. But Western Europe's constant-currency growth has been inched up slightly as strategic IT initiatives in the region will continue despite a poor economic outlook." 

The forecast for spending on devices in 2013 has been revised down from 7.9% growth in Gartner's previous forecast to just 2.8%. The decline in PC sales, recorded in the first quarter of 2013, continued into the second quarter with little recovery expected during the second half of 2013.

“While new devices are set to hit the market in the second half of 2013, they will fail to compensate for the underlying weakness of the traditional PC market,” said Gordon. “The outlook for tablet revenue for 2013 is for growth of 2.8%, while mobile phone revenue is projected to increase 7.4% this year.

Enterprise software spending is on pace to grow 6.4% in 2013. Growth expectations for customer relationship management have been raised to reflect expanded coverage into e-commerce, social and mobile. Expectations for digital content creation and operating systems have been reduced, as software as a service (SaaS) and changing device demands impact traditional models and markets.

Telecom services spending is forecast to grow just 0.9% in 2013. Fixed broadband is showing slightly higher than anticipated growth, with the impact of voice substitution is mixed as it is moving faster in the consumer sector, but slightly slower in the enterprise market.

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Graeme Philipson

Graeme Philipson is senior associate editor at iTWire and editor of sister publication CommsWire. He is also founder and Research Director of Connection Research, a market research and analysis firm specialising in the convergence of sustainable, digital and environmental technologies. He has been in the high tech industry for more than 30 years, most of that time as a market researcher, analyst and journalist. He was founding editor of MIS magazine, and is a former editor of Computerworld Australia. He was a research director for Gartner Asia Pacific and research manager for the Yankee Group Australia. He was a long time IT columnist in The Age and The Sydney Morning Herald, and is a recipient of the Kester Award for lifetime achievement in IT journalism.

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