Gartner upgrades worldwide IT spending forecast

Worldwide IT spending on public cloud services grows four times more than overall IT spending

Gartner on Thursday upgraded its forecast for worldwide IT spending, saying it will grow 7.1 percent this year to US$3.7 trillion as companies migrate to the cloud and spend more on software and IT services.

The research firm previously forecast a growth of 5.6 percent in worldwide IT spending compared to last year, in which spending totaled $3.4 trillion and increased 5.9 percent from 2009. Growth in IT spending will continue through 2012, said Richard Gordon, research vice president at Gartner, in a statement.

The revised projections reflect the minimal impact on tech spending of the Japan earthquake and tsunami on March 11, which affected supply chains and caused extensive damage to buildings and factories along the country's eastern coast. The earthquake may have caused problems in supply of components, but it hasn't affected overall IT spending, Gordon said.

The hardware segment is poised for the fastest growth, but the greatest amount of spending will take place on telecom, according to Gartner's forecast. Spending on telecommunications will increase to $2.1 trillion, growing year-over-year by 6.9 percent, but slower than the 7.3 percent growth last year. Hardware spending is expected to grow faster that other sectors, at a rate of 11.7 percent to $419 billion, albeit slower than last year's growth rate of 12.1 percent.

Spending will grow in the software and IT services segments, partly driven by the growing adoption of public cloud services and software-as-a-service. On a percentage basis, spending on IT services will more than double, growing by 6.6 percent to reach $846 billion. Last year, spending on IT services totaled $793 billion, growing only by 3.1 percent. Software spending is expected to grow by 9.5 percent year-over-year to $268 billion, Gartner said.

Though a marginal part of overall IT spending, cloud computing services are emerging as a driver for IT spending in some markets, growing by more than four times than overall IT spending, Gordon said. The effect of migration to public cloud services spending likely will spill over to the software sector as companies spend more on software-as-a-service.

"At about $10 billion, software as a service ... already accounts for 10 percent of enterprise applications software spending, and by 2015 this share is expected to increase to close to 15 percent and to exceed $20 billion in annual spending," Gordon said.

But the overall spending on the cloud is still nominal, Gartner said. Spending on public cloud services will be roughly $89 billion this year, compared to $74 billion last year. The market will continue to grow and reach $177 billion by 2015, but at the time be only 5 percent of the total IT spending.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags Gartnerbusiness issuesservicessoftwaretelecommunicationhardware systems

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Agam Shah

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?