IT spending will reach $3.54tn in 2016, according to analyst house Gartner, although growth is slowing down owing to economic and market turmoil.
The Gartner Worldwide IT Spending Forecast said that growth in 2016 amounts to a 0.6 percent increase over 2015's figure of $3.52tn.
Emerging markets in the Middle East and Africa will help maintain the growth of IT spending, but spending in the US will continue to fall, following a $216bn decline in spending in 2015 over 2014.
John-David Lovelock, a research vice president at Gartner, explained that the decline in US spending is down to currency challenges.
"The rising US dollar is the villain behind the 2015 results. US multinationals' revenue faced currency headwinds in 2015. However, in 2016 those headwinds go away and they can expect an additional five per cent growth,” he said.
Gartner warned that economic and political turmoil in some emerging markets, such as Russian and Brazil, could make it challenging for them to dedicate spending to IT.
But the analyst house also predicted that overall spending across all markets will increase in 2017 once the challenging economic environment of 2016 has stabilised.
The largest proportion of IT spending will be on communications devices, according to the report, amounting to $1.45tn in 2016, although this is a decline of 1.2 percent on 2015.
Spending on data centre services is predicted to grow by 1.8 percent to $170bn, probably as a reaction to the growing need for regional data centres as data migration safeguards such as Europe’s Safe Harbour are nullified.
The amount spent on IT services will increase by 3.1 percent to $940bn in 2016. Gartner attributed this to companies adopting cloud services, and IT vendors expanding cloud infrastructures.
IT software spending will rise by 5.3 percent on 2015 to $326bn, indicating that demand for software will remain strong even in the face of spending cuts in other areas of IT.
Economic effects can be attributed to the slowdown of overall IT spending, but Gartner’s forecast for 2016 indicates an increasing appetite for cloud and software delivered services as opposed to expensive hardware and infrastructure.
This will not come as a surprise given the decline in PC sales in 2016.
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