Gartner forecasts 'dynamic changes' in IT spend this year

Analyst predicts global IT spending to hit $3.76tn this year

Worldwide IT spending will hit a high of $3.76tn (£2.86tn) as it shifts from devices to new areas including cloud services, according to Gartner.

John-David Lovelock, research VP at Gartner, said that despite the current global economic climate, IT spending is predicted to see three per cent growth in 2019, though he warns that the focus of this spending will shift dramatically.

"Despite uncertainty fuelled by recession rumours, Brexit, and trade wars and tariffs, the likely scenario for IT spending in 2019 is growth," he said.

"However, there are a lot of dynamic changes happening in regards to which segments will be driving growth in the future.

"Spending is moving from saturated segments such as mobile phones, PCs and on-premise datacentre infrastructure to cloud services and IoT devices.

"IoT devices, in particular, are starting to pick up the slack from devices. Where the devices segment is saturated, IoT is not."

The analyst also predicts continued strong growth for enterprise software spending, projecting it to total $466bn in 2020.

This is being fuelled by expectations that organisations will increase their spending on enterprise application software this year as budgets shift to software-as-a-service, according to Gartner.

"IT is no longer just a platform that enables organisations to run their business," said Lovelock. "It is becoming the engine that moves the business.

"As digital business and digital business ecosystems move forward, IT will be the thing that binds the business together."

Despite the slowdown in the smartphone market, the research house predicts that the segment will grow 1.6 per cent in 2019, driven by replacement cycles in China, the US and western Europe.

However, Lovelock warned that the skills needed by organisations are struggling to keep pace with the speed that they are adopting these new technologies.

"In addition to buying-behaviour changes, we are also seeing skills of internal staff beginning to lag as organisations adopt new technologies, such as IoT devices, to drive digital business," he said.

"Nearly half of the IT workforce is in urgent need of developing skills or competencies to support their digital business initiatives.

"Skill requirements to keep up - such as artificial intelligence (AI), machine learning, application programming interface and services platform design and data science - are changing faster than we've ever seen before."

Table 1. Worldwide IT Spending Forecast (Billions of US Dollars)

Source: Gartner (January 2019)