Worldwide IT spending to slow in 2014

Global spending on IT is set to be lower than predicted, according to Gartner

Money

Worldwide IT spending is set to total $3.7 trillion (2.16 trillion) in 2014, according to Gartner figures, representing a growth of 2.1 per cent.

Though the figures look encouraging at first glance, they represent a slowdown in growth from the predicted 3.2 per cent Gartner has previously tipped. The slower growth has been attributed to reduced expectations for devices, datacentre technologies and IT systems.

Devices will reach a total spending of around $685 billion (400 billion), according to Gartner, a 1.2 per cent increase from 2013. Lower price points across mobile phone and tablets have driven the growth as tablet adoption will peak at over 50 per cent (in the US).

There will be a tidal shift towards lower-end tablets in 2015, however, as those left out seek cheaper versions of the top brands.

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Datacentres will experience a miniscule growth of 0.4 per from 2013, with "constrained spending levels" continuing to have a bad impact on the profitability of datacentre systems. The sector is also experiencing losses as enterprise customers move towards cheaper alternatives, says Gartner.

Compared to others, enterprise spending will see a boost of around 6.9 per cent from 2013, to $1.63 trillion (950 billion), spurred on by rising spending in database management systems, while IT services will grow by 3.8 per cent overall.

"Price pressure based on increased competition, lack of product differentiation and the increased availability of viable alternative solutions has had a dampening effect on the short term IT spending outlook," said Richard Gordon, managing vice president at Gartner.

"However, 2015 through 2018 will see a return to normal' spending growth levels as pricing and purchasing styles reach a new equilibrium.

"IT is entering its third phase of development, moving from a focus on technology and processes in the past to a focus in the future on new business models enabled by digitalisation." 

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