CXO

Cloud services driving global IT spending growth for 2019

Businesses are shifting from mobile phones, PCs, and on-premise data centers to cloud services and IoT devices, according to Gartner.

Global IT spending will reach $3.8 trillion in 2019—an increase of 3.2% over 2018, despite an uncertain worldwide political climate, according to Gartner's 2019 IT spending forecast, released Monday.

"Despite uncertainty fueled by recession rumors, Brexit, and trade wars and tariffs, the likely scenario for IT spending in 2019 is growth," John-David Lovelock, research vice president at Gartner, said in a press release. "However, there are a lot of dynamic changes happening in regards to which segments will be driving growth in the future."

SEE: Year-round IT budget template (Tech Pro Research)

Spending is shifting from areas like mobile phones, PCs, and on-premises data center infrastructure to cloud services and Internet of Things (IoT) devices, the report found.

Enterprise software spending is projected to grow 8.5% from 2018 to 2019, and another 8.2% in 2020, for a total of $466 billion, the report found. The increase is spending is due in large part to budgeting shifts to Software as a Service (SaaS), the forecast noted.

IT services spending will rise 4.7% in 2019, and data center systems will grow 4.2%, according to the report. Meanwhile, devices including mobile phones will only grow 1.6%, and communications services will grow 1.3% this year.

SEE: New equipment budget policy (Tech Pro Research)

Along with these purchasing changes, IT leaders must work to develop the skills of their workers to support new digital business initiatives, Lovelock said in the release. Skills in areas such as artificial intelligence (AI), machine learning, API, service platform design, and data science are changing faster than ever before, and will be necessary to keep up with digital transformation, he added.

"IT is no longer just a platform that enables organizations to run their business on. It is becoming the engine that moves the business," Lovelock said in the release. "As digital business and digital business ecosystems move forward, IT will be the thing that binds the business together."

To learn more about how to best plan your IT budget, check out our special feature Tech budgets 2019: A CXO's guide.

The big takeaways for tech leaders:

  • Global IT spending will reach $3.8 trillion in 2019, an increase of 3.2% over 2018. — Gartner, 2019
  • Enterprise software spending will dominate IT growth in 2019. — Gartner, 2019

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Image: iStockphoto/belekekin

About Alison DeNisco Rayome

Alison DeNisco Rayome is a Senior Editor for TechRepublic. She covers CXO, cybersecurity, and the convergence of tech and the workplace.

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