In a statement on Wednesday, Richard Gordon, managing vice-president at Gartner (News - Alert), said, “Globally, businesses are shaking off their malaise and returning to spending on IT to support the growth of their business.” This is in reference to the fact that Gartner expects an increase in global IT spending this year.
The figure that Gartner is looking at is $3.8 trillion in 2013-2014. Keep in mind that this not only includes global spending, but spending in every aspect of IT. That means that included in this is devices, enterprise software, IT and rich communication suite services, along with telecommunications services and data center systems. This represents an increase of 3.2 percent.
The expectation is that this year we will see a shift from the planning and testing stage to the deployment process of many IT services. This is seen as a 4.6 percent growth leading to $964 billion worldwide in 2014. We can anticipate that this year will see most if not all of these projects being implemented.
Each area will experience growth in differing rates. Enterprise software is seen as the fastest growing this year. The forecast is that it will grow to around the $320 billion mark, which represents a 6.9 percentage growth this year. This is due to the fact that companies should be untying that knot on their purse strings. They won’t be opening that purse completely, but at least enough to get projects moving along.
Last year we witnessed a decline of about 1.4 percent in the devices market. This year we should see that turn around and be on the upswing again. Devices such as personal computers, ultra-mobiles, smartphones and tablets should increase by 4.4 percent growing to about $689 billion.
Customer relationship management (CRM) is a model for managing a company’s interactions with current and future customers. It involves using technology to organize, automate and synchronize sales, marketing, customer service and technical support. This is an area that should experience growth thanks to the convergence of social, mobile, cloud and information.
In turn, this will also lead to growth in data integration tools, data quality tools, as well as database management system (DBMS) software. According to Gordon, Gartner predicts that DBMS will surpass operating systems this year which should make it the largest enterprise market in 2014.
Gartner also sees significant growth in data center systems. The expectation here is that spending will reach $143 billion, representing a growth of 2.3 percent annually. It would seem that this year virtualization and cloud adoption are generating significant market traction for data center systems. This is one of those win/win situations. Data centers can save money because they don’t need as much equipment and will mostly rely on management software and companies providing virtualization and cloud services will see an increase in revenue.
Virtualization can potentially shake-up the telecommunications market. As network hardware begins to be released, software and carriers are expected to save money and benefit greatly from new levels of flexibility related to hosting their network in private and virtual private clouds.
As you can see, it just takes one spark to light the fuse that will burn through several services and sections in the global IT market, to produce substantial growth all around. Moving along, technological improvements in Voice over IP (VoIP) should produce more spending for telecom services. Gartner sees a growth of about 1.3 percent or $1.65 trillion.
One area that will see a slight shift could be mobile devices. While LTE (News - Alert) networks are expanding in most areas, telecom networks are being deployed in emerging regions for the first time. According to Gartner consumer spending will shift to mid-tier premium phones as expensive premium phones find fewer buyers in mature markets,
Device buyers in emerging markets will favor low-end Android (News - Alert) smartphones. Product pricing will become the “primary differentiator” going forward, at least in terms of smartphones. Gordon commented that “consumers will be purchasing many new devices in 2014; however, there is a greater substitution toward lower cost and more basic devices than we have seen in prior years.”
Edited by Alisen Downey