Worldwide IT spending is set to reach almost US$3.8-trillion (R51.3-trillion) in 2019, according to new research from analyst firm Gartner. This is a 3.2% increase over spending in 2018.
“Despite uncertainty fuelled by recession rumours, Brexit, and trade wars and tariffs, the likely scenario for IT spending in 2019 is growth,” said John-David Lovelock, research vice president at Gartner, in a statement on Monday.
“However, there are a lot of dynamic changes happening regarding which segments will be driving growth in the future,” he said. “Spending is moving from saturated segments such as mobile phones, PCs and on-premises data centre infrastructure to cloud services and Internet of things (IoT) devices. IoT devices are starting to pick up the slack from devices. Where the devices segment is saturated, IoT is not.”
With the shift to cloud computing — a key driver of IT spending — enterprise software will continue to show strong growth, with worldwide software spending projected to grow by 8.5% in 2019, according to Gartner. It will grow another 8.2% in 2020 to total $466-billion. Organisations are expected to increase spending on enterprise application software in 2019, with more of the budget shifting to software as a service.
“IT is no longer just a platform that enables organisations to run their businesses. It is becoming the engine that moves the business,” said Lovelock. “As digital business and digital business ecosystems move forward, IT will be the thing that binds the business together.”
Replacement cycles
Despite a slowdown in the mobile phone market, the devices segment is expected to grow by 1.6% in 2019. The largest and most highly saturated smartphone markets, such as China, US and Western Europe, are driven by replacement cycles. With Samsung Electronics facing challenges bringing well-differentiated premium smartphones to market and Apple’s “high price-to-value benefits” for its flagship smartphones, consumers kept their current phones and drove the mobile phone market down 1.2% in 2018.
“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,” said Lovelock. “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, machine learning, API and services platform design and data science, are changing faster than we’ve ever seen before.” — © 2019 NewsCentral Media
