World IT spending to reach $3.7 trillion in 2018, says Gartner

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IT Spending, Gartner,

Leading research and advisory company, Gartner has projected in its latest forecast that worldwide Information technology spending will reach $3.7 trillion in 2018, representing 6.2 percent growth from 2017.

Gartner attributed this growth to the declining U.S. dollar, which has caused currency tailwinds. “Although global IT spending is forecast to grow 6.2 percent this year, the declining U.S. dollar has caused currency tailwinds, which are the main reason for this strong growth,” said John-David Lovelock, research vice president at Gartner.

According to Garner, this is the highest growth rate it has forecasted since 2007, saying the growth appears to be a sign of a new cycle of Information Technology growth, which also in line with global economic growth.

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The breakdown of the growth shows Enterprise software spending is expected to experience the highest growth in 2018 with an 11.1 percent increase. Barring unexpected disruption, the software industry is expected to continue capitalizing on the evolution of digital business. Application software spending is expected to continue to rise through 2019, and infrastructure software will also continue to grow, bolstered by modernization initiatives.

Even with a strong end to 2017, worldwide spending on data center systems is forecast to grow 3.7 percent in 2018, down from 6.3 percent growth in 2017. The longer-term outlook continues to have challenges, particularly for the storage segment. The strength at the end of 2017 was primarily driven by the component shortage for memory components, and prices have increased at a greater rate than previously expected. Whereas previously, component shortages were expected to ease into 2018, the shortages are now expected to continue throughout the year with the supply not expected to ease until the end of the year.

Worldwide spending for devices — PCs, tablets and mobile phones — is forecast to grow in 2018, reaching $706 billion, an increase of 6.6 percent from 2017. “The device market continues to see dual dynamics. Some users are holding back from buying, and those that are buying are doing so, on average, at higher price points,” said Mr. Lovelock. “As a result, end-user spending will increase faster than units through 2022. However, total end-user spending and unit shipments are expected to be lower compared with previous forecasts, as demand for ultramobile premium devices, ultramobile utility devices and basic phones is expected to be slow.”

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.

The Gartner quarterly IT spending forecast delivers a unique perspective on IT spending across the hardware, software, IT services and telecommunications segments. These reports help Gartner clients understand market opportunities and challenges. The most recent IT spending forecast research is available at Gartner Worldwide Spending Forecast. This quarterly IT Spending Forecast page includes links to the latest IT spending reports, webinars, blog posts and press releases.

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