Long-Term Trend: Software And Services Spending Up, Hardware Down
Research firm Gartner said global IT spending is expected to reach $3.865 billion in 2020, up a healthy 3.4 percent over the $3.737 billion spent in 2019, when spending grew a mere 0.5 percent.
That spending is expected to grow even faster in 2021, which Gartner estimated would reach $4.007 billion, up 3.7 percent over 2020.
The future of IT spending will be characterized by a combination of decreased spending on hardware devices and an increase in spending on software and services, including on the cloud, said John Lovelock, chief forecaster for technology and service provider research at Gartner.
“Hardware spending will be falling over time,” Lovelock told CRN. “Many segments have already passed peak spending. Don’t expect spending to meet their peaks again.”
Lovelock said several types of hardware products have already passed peak spending, including printers, PCs and servers, with mobile phones the only category to see spending rise for another year or two before peaking. “People are holding on to products longer than in the past,” he said.
On the other hand, spending on software, particularly for the cloud, will continue to increase, Lovelock said. “IT is moving from hardware to software,” he said.
2019 saw relatively small growth of 0.5 percent over 2018, but growth will roar back in 2020 and 2021 as the global economy resolves some big uncertainties, Lovelock said.
“The China trade issues have been somewhat resolved,” he said. “And Brexit is getting there. It should be resolved by next year. Most of the uncertainty should be resolved this year. We didn’t expect the current Middle East tensions when we prepared this report, but if we had, there would have been no change. The areas impacted account for under 1 percent of the total forecast.”
Following are details about how—and why—global IT spending is expected to change for five key parts of the IT industry.