'Significant slowdown' in IT spending now expected this year

Growth could drop to as little as one per cent on 2019, IDC says

The channel should brace for a "significant slowdown" of IT spending this year, particularly in hardware, according to IDC.

The analyst has reforecast its IT spending estimates for the year and is now expecting global spending growth of as little as one per cent on 2019, down from previous estimates of over four per cent.

It said that the spread of the coronavirus has already affected IT spending.

IDC VP Stephen Minton said: "The situation is extremely fluid.

"Our monthly data and surveys are clearly pointing in one direction, but it's still too early to understand the full impact of the coronavirus crisis across all sectors of the economy.

"We are using scenario models to illustrate that forecasts have a wider range than usual, and the downside risks in those models seem to be increasing every day. But the duration of the crisis remains a big unknown and will go a long way in determining overall market growth for the year as a whole."

IDC said that the one per cent growth estimate is from a pessimistic view, but stressed that it is not a worst-case scenario.

The initial estimate of five per cent growth was forecast partly because of the rise of 5G, which was expected to drive smartphone refreshes.

Minton added that weak economic growth would have a domino effect on both business and consumer spending across all technologies over the coming quarters.