Gartner Cuts 2013 IT Spending Forecast Due to PC Market Weakness

Sales of traditional PCs will continue to slow in the second half of 2013, leading the analysts to cut expected IT spending forecasts to 2 percent for the year.

Gartner analysts are reducing their forecast for worldwide IT spending for 2013, due in large part to the continued decline of PC sales.

Gartner is now expecting spending on IT to hit $3.7 trillion this year, a 2 percent increase from $3.6 trillion in 2012. It's less than the 4.1 percent growth Gartner had forecast in the first quarter for this year, with fluctuations in U.S. dollar exchange rates also playing a role, according to Richard Gordon, managing vice president at Gartner.

"Exchange-rate movements, and a reduction in our 2013 forecast for devices, account for the bulk of the downward revision of the 2013 growth," Gordon said in a statement. "Regionally, 2013 constant-currency spending growth in most regions has been lowered. However, Western Europe's constant-currency growth has been inched up slightly as strategic IT initiatives in the region will continue despite a poor economic outlook."

The analyst firm sharply cut the expected growth this year in sales of devices, from 7.9 percent in the first quarter to 2.8 percent now. PC sales have been on the decline for more than a year, due in large part to the growing popularity of tablets and smartphones. Microsoft's introduction of Windows 8 last year did not give the hoped-for bounce to the PC market, though some industry observers say new systems powered by Intel's Core "Haswell" processors could help increase system sales. Others are not so sure.

Intel officials have said graphics capabilities and battery life of Haswell-powered systems could improve by 50 percent, with performance increasing as much as 15 percent. They also expect Haswell chips to power a range of systems, from PCs and Ultrabooks to tablets and hybrids. PC makers like Hewlett-Packard, Lenovo and Dell unveiled new Haswell-powered systems in June.

However, Gartner analysts noted that while new devices will come to the market in the second half of 2013, they won't be enough to make up for the growing weakness in the traditional PC market. In a report June 24, Gartner analysts said they expect shipments of traditional PCs will continue to fall—by 10.6 percent in 2013—while tablet shipments will jump 67.9 percent.

Tablet revenues for 2013 will grow 38.9 percent, while mobile phone sales will increase 9.3 percent, the analyst firm said.

Spending on devices will hit $695 billion this year and $740 billion in 2014, according to Gartner's latest numbers. Buyers will spend $143 billion on data center systems in 2013 (a 2.1 percent increase) and $149 billion next year, and $304 billion (a 6.4 percent jump) in enterprise software in this year and $324 billion next year.

IT services spending will hit $926 billion (a 2.2 percent hike) in 2013 and $968 billion in 2014, while spending on telecommunications services will reach $1.65 trillion (a 0.9 percent increase) this year and $1.69 trillion next year.

Gartner analysts expect overall IT spending in 2014 to reach $3.87 trillion, a 4.1 percent increase from 2013 spending.