Worldwide IT spending is set to top $3.5 trillion in 2017, a 1.4% increase from 2016, according to Gartner.
However, the growth rate is down from a forecast of 2.7%, which the analyst firm attributed in part to the rising US dollar.
John-David Lovelock, research VP at Gartner, said that the strong US dollar has cut $67 billion out of its 2017 IT spending forecast. "We expect these currency headwinds to be a drag on earnings of US-based multinational IT vendors through 2017," he said.
The analyst house predicted that the data centre system market is expected to grow 0.3% in 2017. While this is up from negative growth in 2016, it is experiencing a slowdown in the server market.
"We are seeing a shift in who is buying servers and who they are buying them from," said Lovelock. "Organisations are moving away from buying servers from the traditional vendors and instead renting server power in the cloud from companies such as Amazon, Google and Microsoft. This has created a reduction in spending on servers, which is impacting the overall data centre system segment."
Driven by strength in mobile phone sales and smaller improvements in sales of printers, PCs and tablets, worldwide spending on devices (PCs, tablets, ultramobilesand mobile phones) is projected to grow 1.7% in 2017, to reach $645 billion. This is up from a 2.6% decline in 2016.
Mobile phone growth in 2017 will be driven by increased average selling prices (ASPs) for phones in emerging Asia/Pacific and China, together with iPhone replacements and the 10th anniversary of the iPhone.
The tablet market continued to decline significantly, as replacement cycles remain extended and both sales and ownership of desktop PCs and laptops are negative throughout the forecast, said Gartner. Over the course of this year, business Windows 10 upgrades should provide underlying growth, although increased component costs will see PC prices increase, added the analyst firm.
The global IT services market is forecast to grow 2.3% in 2017, down from 3.6% growth in 2016. The analysts said that modest changes to the IT services forecast this quarter can be "characterised as adjustments to particular geographies as a result of potential changes of direction anticipated regarding US policy both foreign and domestic".
Gartner added that business-friendly policies of the new US administration are expected to have a slightly positive impact on the US implementation service market as the US government is expected to significantly increase its infrastructure spending during the next few years.
Picture: Bigstock
HP Inc records best PC sales growth since XP refresh Should I upgrade to Windows 10? How modern is your data centre?
-
What is polymorphic malware?Explainer Polymorphic malware constantly changes its code to avoid detection, making it a top cybersecurity threat that demands advanced, behavior-based defenses
-
Outgoing Kaseya CEO teases "this is just the beginning" for the companyOpinion We spoke to Fred Voccola who remains a key figurehead at the firm as it enters its next chapter...
-
Nearly half of all digital initiatives still fail – here’s how you can learn from the ‘digital vanguard’ and deliver successNews With most digital initiatives are failing to deliver, CIOs are urged to work more closely with other executives
-
IT services spending set to surge in 2025 as CIOs shift to AI partner solutionsNews Organizations are set to shift from buying generative AI solutions to implementing partner solutions, according to Gartner
-
Businesses still don’t know who’s accountable for AI at executive levelNews Executives are unclear on where the buck stops in terms of AI management
-
Gartner reveals the top trends for government technology use in 2024News Five key areas that public sector CIOs will need to address to improve citizen services
-
Return to office mandates can be divisive - here are three things business leaders can do to help smooth the transitionAnalysis With return to office mandates having sparked major spats between workers and employers, leaders need to consider how they can make changes attractive and effective
-
Global IT spending set to reach $5 trillion in 2024 amid optimistic industry outlookNews IT spending growth in 2024 is expected to be more than double that of 2023
-
What will drive IT spending in 2024?In-depth Generative AI spending is unlikely to be high despite the hype, but sustainable technology will become a bigger priority.
-
Half of jobseekers turned down offers last year amid growing demands on employersNews An increasingly competitive talent landscape means employers are being forced to offer a wider range of incentives
