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Mixed results predicted for 2012 IT spending

Analyst firm Gartner says overall, IT departments will spend more on tech this year, but the rate of growth is still lower than expected.

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IT spend this year is predicted to rise, but the level of growth is still lower than analysts have previously predicted.

Secifically, analyst firm Gartner forecast 2012 IT spending to total $3.7 trillion (2.3 trillion), a 2.5 per cent increase from 2011. However, this is lower than Gartner's expected forecast of 3.7 per cent growth.

The reason for the decline in growth is the strengthening of the US dollar compared to other currencies, according to Gartner. However, the firm also reported that, if spending was constant in US dollars, IT spending could increase to 5.2 per cent in 2012, up from the previous estimate of 4.6 per cent.

Richard Gordon, research vice president for Gartner, reassures that despite changes in the global economy, the growth will continue.

"Despite ongoing concerns about the global economic recovery most notably around the resolution of Euro zone sovereign-debt problems, worries about the potential for China's real estate 'bubble' to spillover and affect the rest of the economy and rising oil prices early signs in 2012 suggest that the global economic outlook has brightened a little," he said.

In the government arena, IT spending is expected to decrease moderately on a global basis in 2012 and 2013, due to austerity measures in the Euro zone. The effects of government budget cutbacks from the sovereign dept crisis are now being felt on IT spending. US government spending is also expected to experience little change in 2012 and contract in 2013.

Spending in the small and midsize business market is expected to reach $874 billion (533 billion) in 2012. This sector, which accounts for a quarter of overall enterprise IT spending, is forecast to grow to $1 trillion (628 billion) by 2016.

Due to the massive growth in the mobile devices market, Gartner predicts that the worldwide telecom equipment market will show the strongest growth in 2012, with spending reaching $472 billion (297 billion), a 6.9 per cent increase from 2011.

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