January 13, 2017 by Canadian Underwriter
Worldwide spending on information technology is projected to total US$3.5 trillion in 2017, a 2.7% increase from 2016, according to Gartner, Inc.
Gartner, a Stamford, Conn.-based IT research and advisory company, noted in a statement on Thursday that the growth rate is down from earlier projections of 3%.
“2017 was poised to be a rebound year in IT spending,” John-David Lovelock, research vice president at Gartner, said in the statement. “Some major trends have converged, including cloud, blockchain, digital business and artificial intelligence. Normally, this would have pushed IT spending much higher than 2.7% growth. However, some of the political uncertainty in global markets has fostered a wait-and-see approach causing many enterprises to forestall IT investments.”
While worldwide devices spending (PCs, tablets, ultramobiles – midsize lightweight computing devices, including some tablets, thin and lightweight PCs and convertibles – and mobile phones) is projected to remain flat in 2017 at US$589 billion, the worldwide IT services market is forecast to grow 4.2% in 2017, Gartner said in the statement. “Buyer investments in digital business, intelligent automation, and services optimization and innovation continue to drive growth in the market, but buyer caution, fueled by broad economic challenges, remains a counter-balance to faster growth.”
Lovelock noted that the range of spending growth “from the high to low” is much larger in 2017 than in past years. “Normally, the economic environment causes some level of division, however, in 2017 this is compounded by the increased levels of uncertainty,” Lovelock pointed out. “The result of that uncertainty is a division between individuals and corporations that will spend more — due to opportunities arising — and those that will retract or pause IT spending.”
For example, aggressive build-out of cloud computing platforms by companies such as Microsoft, Google and Amazon is pushing the global server forecast to reach 5.6% growth in 2017. This was revised up 3% from last quarter’s forecast and is sufficient growth to overcome the expected 3% decline in external controller-based storage and allow the data center systems segment to grow 2.6% in 2017.