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January 13, 2017

Global IT spend in 2017 set to stall thanks to Brexit and Trump

Gartner has revised projections for 2017 in response to political uncertainty in global markets.

By Ellie Burns

Brexit and Trump have already made a small dent in 2017, with worldwide IT spending set to stall due to the political uncertainty in global markets. The growth rate for global IT spend is down 3% from earlier projections, with Gartner forecasting spend to total $3.5 trillion in 2017, a 2.7 per cent increase from 2016.

“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.”

Device spending is set to remain flat in 2017, with projections totalling $589 billion. However, a replacement cycle in the PC market and strong pricing and functionality of premium ultramobiles will help drive growth in 2018.

Emerging markets will drive the replacement cycle for mobile phones as smartphones in these markets are used as a main computing device and replaced more regularly than in mature markets.IT spend

 

Gartner expects the global IT services market to grow 4.2% in the next year, with digital business, intelligent automation and services automation attracting buyer investments and fuelling growth. However, buyer caution thanks to broad economic challenges will remain a counter-balance to faster growth.

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“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 Mr 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.”

 

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