Gartner Increases IT Spending Numbers to $3.7 Trillion in 2011

 
 
By Jeffrey Burt  |  Posted 2011-06-30
 
 
 

IT spending worldwide will grow 7.1 percent, despite any disruption that was caused by the devastating earthquake and tsunami that hit Japan in March, according to analysts at market research firm Gartner.

The June 30 recalculated spending forecast-up from Gartner's first-quarter projection of 5.6 percent growth-is the latest indication that while the disasters that pounded Japan may have had some impact on the technology industry, the overall effect doesn't appear to be as bad as some had feared.

On June 21, Gartner and IHS iSuppli released separate reports on the growing semiconductor industry, with both firms saying that the impact of the earthquake and subsequent tsunami was less than expected.

"Thanks to the hardiness of the global electronics supply chain, the semiconductor industry is set for a year of solid growth in 2011," Dale Ford, senior vice president for semiconductor market intelligence at IHS iSuppli, said in a statement when the report came out. "Neither the Japan quake disaster nor weak economic conditions will derail the market's expansion."

For Gartner analyst Richard Gordon, the lack of impact on IT spending is unexpected.

"It is a bit surprising that we have not seen a more significant impact on our global IT spending forecast as a result of the Japan earthquake and tsunami, but despite widespread concerns about disruptions to the supply of critical components in the initial aftermath of the natural disaster, there has not been a dramatic impact on overall IT spending," Gordon said in a statement. "For 2011 as a whole, we expect Japan IT spending to be down in local currency, but we expect a positive growth trend to emerge in the second half of the year and continue into 2012."

Overall, Gartner is predicting IT spending to grow to $3.7 trillion in 2011, as compared with the $3.4 trillion spent in 2010.

The hardware and computing segment will see the strongest growth of 11.7 percent, to $419 billion, according to the analyst firm. One area that will see rapid growth is public cloud services, with spending hitting $89 billion this year-up from $74 billion in 2010-and rising to $177 billion by 2015. The cloud services market is growing four times faster than overall IT spending, according to Gartner.

Despite the rapid growth in the segment, Gartner analysts pointed out that public cloud services spending accounted for about 2 percent of global spending in 2010, and will be less than 5 percent overall by 2015.

"Nevertheless, the emergence and adoption of cloud is an important trend, and in some markets, it's already a significant factor," Gordon said. "For example, at about $10 billion, software as a service [SaaS] already accounts for 10 percent of enterprise applications software spending, and by 2015 this share is expected to increase to close to 15 percent and to exceed $20 billion in annual spending."

Other analyst firms and vendors also are seeing the trend in clouds going up. Chip maker Advanced Micro Devices released a report in June indicating that enterprises are increasingly embracing cloud computing, with 75 percent of survey respondents saying they are using or will start using cloud computing.

In Gartner's spending report, enterprise software sales will grow 9.5 percent, to $268 billion, while IT services will jump 6.6 percent, to $846 billion. Telecom technology sales will hit $2.1 trillion, a 6.9 percent jump over 2010.

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