Cloud boosts global IT spend in 2017

Bill Boyle
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Worldwide IT spending is projected to increase by 2.7% in 2017 says Gartner

Worldwide IT spending is projected to total $3.5 trillion in 2017, a 2.7% increase from 2016, according to Gartner which also considers the market to be much more volatile than last year.

Aggressive build-out of cloud computing platforms by companies such as Microsoft, Google and Amazon is pushing the global server forecast to reach 5.6% growth in 2017. This was revised up 3% from last quarter's forecast and is sufficient growth to overcome the expected 3% decline in external controller-based storage and allow the data centre systems segment to grow 2.6% in 2017.

"2017 was poised to be a rebound year in IT spending. Some major trends have converged, including cloud, blockchain, digital business and artificial intelligence. Normally, this would have pushed IT spending much higher than 2.7 percent growth," said John-David Lovelock, research vice president at Gartner. "However, some of the political uncertainty in global markets has fostered a wait-and-see approach causing many businesses to forestall IT investments."

This amended growth rate is down from earlier Gartner projections of 3%.

The worldwide IT services market is forecast to grow 4.2% in 2017. Buyer investments in digital business, intelligent automation, and services optimisation and innovation continue to drive growth in the market, but buyer caution, fuelled by broad economic challenges, remains a counter-balance to faster growth.

"The range of spending growth from the high to low is much larger in 2017 than in past years. Normally, the economic environment causes some level of division, however, in 2017 this is compounded by the increased levels of uncertainty," said Lovelock. "The result of that uncertainty is a division between individuals and corporations that will spend more — due to opportunities arising — and those that will retract or pause IT spending."