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Analyst Corner
Worldwide IT Spending to Surpass USD 3T in 2007
According to research company, Gartner, 2007 will be the most significant year for the IT industry, as worldwide IT spending is projected to surpass USD 3 trillion. IT spending will reach USD 3.1 trillion in 2007, an eight per cent increase from last year, and spending for 2008 is forecast grow 5.5 per cent and total USD 3.3 trillion.
During the opening keynote at Gartner Symposium-ITxpo held in Orlando, Florida, Gartner outlined how IT leaders must be able to respond to change quicker than ever before. There is a need for flexibility, and a need for agility.
Peter Sondergaard, senior vice president and global head, Research, Gartner, said IT leaders should create two IT budgets for 2008. The first should reflect the same kind of marginal growth prepared during the past six years. The second budget should assume the need to cut costs in response to the arrival of a possible recession.
Sondergaard said, “The business plans that you had in June are probably not going to completely address the changed conditions of your business in November. Together with your business colleagues and your CEO you are going to have to deliver new efficiencies, new innovations and new ideas to sustain profitability and growth. IT will be core to many of those responses.”
He said the challenge for IT leaders is how they are going to react. He further added, “Simply delivering internally focused savings isn’t going to be enough. IT leaders need to step up to the challenge of delivering new solutions to those critical business imperatives.”
Globally, IT spending continues to grow at a rapid pace in developing countries. In fact, one-third of IT spending is now outside of North America, Western Europe, and Japan. This evolution will create new innovation in IT, new competitors, new usage patterns, and continued cost improvement benefits for users.
As IT moves East (Asia) and South (Latin America), it will impact the growing areas of the industry. End-user spending will globally move towards software, services, and all aspects of mobility. These categories made up 57 per cent of spending in 2006, will increase to 60 per cent in 2008, and are estimated to grow to 63 per cent in 2011.
During the opening keynote at Gartner Symposium-ITxpo held in Orlando, Florida, Gartner outlined how IT leaders must be able to respond to change quicker than ever before. There is a need for flexibility, and a need for agility.
Peter Sondergaard, senior vice president and global head, Research, Gartner, said IT leaders should create two IT budgets for 2008. The first should reflect the same kind of marginal growth prepared during the past six years. The second budget should assume the need to cut costs in response to the arrival of a possible recession.
Sondergaard said, “The business plans that you had in June are probably not going to completely address the changed conditions of your business in November. Together with your business colleagues and your CEO you are going to have to deliver new efficiencies, new innovations and new ideas to sustain profitability and growth. IT will be core to many of those responses.”
He said the challenge for IT leaders is how they are going to react. He further added, “Simply delivering internally focused savings isn’t going to be enough. IT leaders need to step up to the challenge of delivering new solutions to those critical business imperatives.”
Globally, IT spending continues to grow at a rapid pace in developing countries. In fact, one-third of IT spending is now outside of North America, Western Europe, and Japan. This evolution will create new innovation in IT, new competitors, new usage patterns, and continued cost improvement benefits for users.
As IT moves East (Asia) and South (Latin America), it will impact the growing areas of the industry. End-user spending will globally move towards software, services, and all aspects of mobility. These categories made up 57 per cent of spending in 2006, will increase to 60 per cent in 2008, and are estimated to grow to 63 per cent in 2011.
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