Global IT spending to be up by 3.4 per cent at $3.9 trillion

Our Bureau Hyderabad | Updated on January 16, 2020 Published on January 16, 2020

Software spending to see two-digit growth; Headwinds for device markets

Here’s a piece of good news for the Indian IT industry. Research firm Gartner predicts that the software pie is going to witness a double digit growth of 10.5 per cent globally as it forecasts a 3.4 per cent growth in the IT spending in 2020.

According to Gartner, the global IT spending will go up to $3.9 trillion, up by 3.4 per cent over last year’s spending.

“With the waning of global uncertainties, businesses are redoubling investments in IT as they anticipate revenue growth, but their spending patterns are continually shifting,” John-David Lovelock, distinguished research Vice-President at Gartner, has said.

“Although political uncertainties pushed the global economy closer to recession, it did not occur in 2019 and is still not the most likely scenario for 2020 and beyond,” he observed.

“Almost all of the market segments with enterprise software are being driven by the adoption of SaaS (software-as-a-service),” Lovelock said.

Growth in enterprise IT spending for cloud-based offerings will be faster than growth in traditional (non-cloud) IT offerings through 2022.

“Organisations with a high percentage of IT spending dedicated to cloud adoption is indicative of where the next-generation, disruptive business models will emerge,” he said.

The headwind coming from a strong US dollar has become a deterrent to IT spending on devices and data centre equipment in effected countries.

“For example, mobile phone spending in Japan will decline this year due to local average selling prices going up as a result of the US dollar increasing. The UK’s spending on PCs, printers, servers and even external storage systems is expected to decline by 3 per cent too,” Lovelock said.

However, the device market will see an overall growth in 2020 despite headwinds in Western Europe and Latin American markets. “The almost $10 billion increase in device spending in Greater China and Emerging Asia-Pacific is more than enough to offset the expected declines in Western Europe and Latin America,” Lovelock said.


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Published on January 16, 2020
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