Gartner: EMEA IT spending will hit $1 trillion in 2018

Brexit and currency fluctuations caused stagnation in 2017, but a return to growth is expected

Analysts at Gartner have predicted IT spending in EMEA will hit $1 trillion by 2018, despite all types of IT-related spending performing poorly compared to global averages this year.

Spending was down in 2017 because of currency discrepancies, according to Gartner, with spending in the UK being hit particularly hard.

"The UK has EMEA's largest IT market and its decline of 3.1% in 2017 impacts the forecast heavily," said John-David Lovelock, research vice president at Gartner. "Weak Sterling and political uncertainty since Brexit are reducing UK IT spending in 2017, while other major IT markets in EMEA grew steadily."  

The value of the US Dollar against the Euro has also had an impact, albeit smaller than the UK, but this gives businesses the opportunity to stem spending until 2018 when they can confidently invest more into their infrastructure, Gartner explained.

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"However, there is more to the recovery in 2018 than just currency effects," added Lovelock. "Strong demand in the enterprise software and IT services categories across EMEA hint at significant shifts in IT spending patterns."

Communications systems suffered the most in 2017, with negative 0.6% growth, with data centre systems coming in second-to-last with growth of just 1.1%. Both areas are expected to grow faster in 2018, with gains of 3.2% and 3.1% respectively.

Enterprise software spending was the biggest winner in 2017, however, with growth of 7.6%, set to increase to 10.5% in 2018.

"In 2017, we're seeing a pause in EMEA enterprise spending due to the switch to as-a-service offerings gaining momentum," Lovelock said.

"The forecast highlights that businesses are broadly reducing spending on owning IT hardware, and increasing spending on consuming IT as-a-service. In the total IT forecast the business trends are masked somewhat by consumer spending, but when we look at enterprise-only spending the new dynamics between the categories are much clearer."

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