Skip to main content

2019 Total Worldwide IT Spending will Reach $3.7 Trillion

Information Technology (IT) infrastructure investment can fluctuate based upon the annual shifts and changes in demand. Worldwide IT spending is forecast to total $3.7 trillion in 2019 -- that's an increase of just 0.4 percent over 2018, according to the latest worldwide market study by Gartner.

That said, this has been the lowest IT growth forecast in 2019. However, Gartner believes that global IT spending will likely rebound in 2020 with forecast growth of 3.7 percent, primarily due to enterprise software spending.

Information Technology Market Development

"The slowdown in IT spending in 2019 is not expected to stretch as far into 2020 despite concerns over a recession and companies cutting back on discretionary IT spending," said John-David Lovelock, research vice president at Gartner.

Today’s complex geopolitical environment has pushed regulatory compliance to the top of organizations’ priority list. Overall spending on security increased by 10.5 percent in 2019, with cloud security projected to grow 41.2 percent over the next five years.

"This is not just about keeping the ‘bad guys’ out," said Mr. Lovelock. "It is also about the expanding need to be compliant with tariffs and trade policy, intellectual property rights, and even with the multiple and sometimes overlapping privacy laws."

Despite the ongoing tariff war, U.S. IT spending is forecast to grow 3.5 percent in 2019, but IT spending in China is expected to grow only 0.1 percent. Tariffs have not had an effect on IT spending.

But if tariffs extend to devices like PCs and mobile phones, then we will likely see manufacturers switch supply routes to minimize costs and have their technology made outside of China.

The device market will see the sharpest spending decline among all segments in 2019, down 5.3 percent from $713 billion in 2018. However, the market is expected to see a modest growth of 1.2 percent in 2020.

"Similar to how consumers have reached a threshold for upgrading to new technology and applications, technology general managers and product managers should invest only in the next generation of products that will push them closer to becoming a true technology company," said Mr.Lovelock.

IT spending growth is being driven by the rest of the world catching up on cloud spending. The U.S. is leading cloud services adoption and accounts for over half of global spending on cloud computing.

In some cases, countries that Gartner tracks lag one to seven years in cloud adoption rates. For perspective, the country directly behind the U.S. on cloud spending is the United Kingdom, which only spends 8 percent on public cloud services.

An interesting outlier is China, which has the highest growth of cloud spending out of all countries. While China is closing the spending gap, it still will not reach U.S. levels by 2023.

Outlook for Worldwide IT Spending Growth

Gartner predicts that organizations with a high percentage of IT spending dedicated to the cloud will become the recognized digital leaders in the future. "Most companies are caught trying to either cut costs or invest for growth, but the top-performing enterprises are doing both,"  said Mr. Lovelock.

A challenge facing many leaders across industries is learning how an established organization can operate as both a traditional company and an emerging digital business at the same time. According to the Gartner assessment, this ongoing scenario will likely drive future IT spending on new products and services.

Popular posts from this blog

Mobility-as-a-Service Creates Disruptive Travel Options

Building on significant advances in big data, analytics, and the Internet of Things (IoT), more innovative transit service offerings aim to increase public transport ridership and reduce emissions or congestion within metropolitan areas. By providing these services through smartphone apps, the transit services also significantly increase user convenience, providing information on different human mobility offerings -- including public transport, ridesharing, and autonomous vehicles. Mobility-as-a-Service Market Development According to the latest market study by Juniper Research, Mobility-as-a-Service (MaaS) subscribers will generate $53 billion in revenue for MaaS platform providers by 2027 -- that's rising from $5.3 billion in 2021. Let's start with a basic definition. MaaS is the provision of multi-modal end-to-end travel services through single platforms, by which users can determine an optimal route and price. The study identified a monthly subscription model as key to incr

Hybrid Work: How to Enhance Employee Productivity

When you hire qualified talent for a key role and trust them to perform, you'll likely achieve the best outcome. Skilled and experienced people will deliver results, regardless of the challenges. That's a key lesson learned from the pandemic experience as most knowledge workers were asked to work from their homes. However, some resist returning to an open-plan office. It's unacceptable. Meanwhile, forward-thinking leaders decided a "return to normal" is undesirable, and in hindsight, everyone should aspire to be more accomodating than before. Therefore, location flexibility is okay. Hybrid Workforce Market Development How will people adapt to these changes? They'll apply the modern IT tools at their disposal. They'll learn new skills and thrive. Nearly 80 percent of employees are now successfully using online collaboration tools for work in 2021 -- that's up from just over half of workers in 2019, according to the latest market study by Gartner. This g

Robocall Mitigation Solutions to Halt Criminal Threats

If you answer the phone and hear a recorded message instead of a live person, it's likely a robocall. A robocall is a phone call that uses a computerized autodialer to deliver a pre-recorded message. In 2020, the U.S. Federal Trade Commission (FTC) received 2.8 million consumer complaints about robocalls. Offering solutions to robocalling and associated fraudulent business practices, computerized mitigation platforms are an integral part of the solution. Platforms that are focused on actionable systems to disrupt unsolicited and potentially criminal phone calls help telecom service providers and industry regulators. Issues of whether one-size-fits-all developments are sufficient to be effective across the spectrum need to be addressed, and whether a single telecom network operator working unilaterally with a third-party platform could compromise desired or mandatory industry-wide standards. Robocall Mitigation Market Development According to the latest worldwide market study by Jun