Gartner says global IT spending to increase 1.1% in 2019

By Jess Phillips   25 April, 2019
Gartner says global IT spending to increase 1.1% in 2019

Worldwide spending on data centre systems is projected to decrease in 2019, according to Gartner

Worldwide spending on data centre systems is projected to decrease in 2019 – while overall IT spending is projected to total US$3.79 trillion in 2019, an increase of 1.1% from 2018, according to the latest forecast by Gartner, Inc.

Gartner says the data centre systems segment is expected to experience the largest decline in 2019 with a decrease of 2.8%, mainly due to expected lower average selling prices (ASPs) in the server market driven by adjustments in the pattern of expected component costs.

However, the shift of enterprise IT spending from traditional (non-cloud) offerings to new, cloud-based alternatives is continuing to drive growth in the enterprise software market and in 2019 the market is forecast to reach US$427 billion, up 7.1% from US$399 billion in 2018.

The largest cloud shift has so far occurred in application software. However, Gartner expects increased growth for the infrastructure software segment in the near-term, particularly in integration platform as a service (iPaaS) and application platform as a service (aPaaS).

John-David Lovelock, Research Vice President at Gartner, said: “Currency headwinds fuelled by the strengthening US dollar have caused us to revise our 2019 IT spending forecast down from the previous quarter.

“Through the remainder of 2019, the US dollar is expected to trend stronger, while enduring tremendous volatility due to uncertain economic and political environments and trade wars.

“In 2019, technology product managers will have to get more strategic around their portfolio mix by balancing products and services that will post growth in 2019 with those larger markets that will trend flat to down.

“Successful product managers in 2020 will have had a long-term view to the changes made in 2019.”

He said that the choices CIOs make about technology investments are essential to the success of digital business.

“Disruptive emerging technologies, such as Artificial Intelligence (AI), will reshape business models as well as the economics of public and private-sector enterprises. AI is having a major effect on IT spending, although its role is often misunderstood,” he said.

“AI is not a product, it is really a set of techniques or a computer engineering discipline. As such, AI is being embedded in many existing products and services, as well as being central to new development efforts in every industry. Gartner’s AI business value forecast predicts that organisations will receive US$1.9 trillion worth of benefit from the use of AI this year alone.”

More detailed analysis on the outlook for the IT industry is available in the complimentary webinar IT Spending Forecast, 1Q19 Update: AI — Use it, Build it or Sell it

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.

The Gartner quarterly IT spending forecast delivers a unique perspective on IT spending across the hardware, software, IT services and telecommunications segments. These reports help Gartner clients understand market opportunities and challenges.

The most recent IT spending forecast research is available to Gartner clients in Gartner Market Databook, 1Q19 Update.

This quarterly IT Spending Forecast page includes links to the latest IT spending reports, webinars, blog posts and press releases.

Lovelock will provide further analysis on the key drivers of the IT market at the Gartner Tech Growth and Innovation Conference taking place between June 3 to 5 in San Diego, CA and June 12 to 13 in London.


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