When it comes to budgeting for IT, three key surveys of IT leaders predict companies will continue to increase their spending to keep their businesses running smoothly and securely, with many moving operations to the cloud.
In its latest report, researchers at Gartner project worldwide IT spending will total $3.7 trillion in 2018, an increase of 6.2 percent from 2017. And the numbers keep going up, with spending expected to reach $3.85 trillion in 2019, up 2.8 percent from 2018.
All of this growth is happening despite uncertain factors such as trade disputes and currency fluctuations.
“This is the highest annual growth rate that Gartner has forecast since 2007 and would be a sign of a new cycle of IT growth,” said John-David Lovelock, research vice president at Gartner.
Enterprise software spending is expected to experience the highest growth in 2018 with an 11.1 percent increase. Barring unexpected disruption, the software industry is anticipated to continue capitalizing on the evolution of digital business. Application software spending is expected to continue to rise through 2019, and infrastructure software will also continue to grow, bolstered by modernization initiatives.
Gartner also predicts that worldwide spending on data center systems will grow 3.7 percent. And worldwide spending for devices — PCs, tablets and mobile phones —will reach $706 billion, an increase of 6.6 percent from 2017.
What these forecasts mean is that companies are likely to be spending more on enterprise application software, mobile devices, infrastructure software and business IT services in 2019 and beyond.
To the Cloud and Beyond
In addition, market research firm Computer Economics found that companies are increasing IT spending as a percentage of their revenue. The firm has published its “IT Spending and Staffing Benchmarks” report annually since 1990, with information for multiple industries and government sectors.
This year’s report concluded that: “IT organizations are accelerating their rush to the cloud and are increasing spending in an effort to reap the benefits. Our composite sample shows broad, modest growth in operational budgets and even stronger increases in spending as a percentage of revenue, while IT capital budgets and hiring remain flat.”
Computer Economics also found that 64 percent of organizations are increasing their IT spending. “IT organizations are encouraged by their experience with cloud computing thus far and are willing to supplement those efficiency gains with additional spending, especially for business transformation and the continued move to the cloud,” the report said.
Focus on Cybersecurity
Meanwhile, the Harvey Nash/KPMG CIO Survey indicates that global IT leaders are prioritizing improvements in cybersecurity along with managing operational risk and compliance. The survey found:
- Almost a quarter more respondents than in 2017 are prioritizing improvements in cybersecurity as cyber-crime threats reach an all-time high. But only a fifth of IT leaders feel well prepared for a cyberattack.
- Cloud investment continues to grow, with 70 percent of IT leaders reporting significant or moderate spending.
“CIOs have a really difficult tight rope to walk,” said Albert Ellis, CEO, Harvey Nash Group. They must find a balance between driving technological innovation at the same time they ensure data and privacy remain safe. “The organizations that can get this balance right, between innovation and governance, are in the strongest position to compete in an increasingly complex technology environment.”
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