With the growing currency fluctuation global IT spending is likely to witness a steep drop in 2015 as against the previous year said a latest forecast by technology advisory firm Gartner.
The technology research firm also said, IT spending will decline than anticipated earlier this year.
According to a latest report from Gartner, worldwide information technology spending will decline by 5.5 per cent decline as against 2014 and total spending is expected to be around $3.5 trillion in 2015. In constant-currency terms, the market is projected to grow 2.5 per cent. Gartner attributed the decline to the rising US dollar.
Earlier in its previous forecast in April, Gartner had said IT spending will decline 1.3 per cent in US dollars and grow 3.1 per cent in constant currency.
“We want to stress that this is not a market crash. Such are the illusions that large swings in the value of the U.S. dollar versus other currencies can create,” said John-David Lovelock, Research Vice-President at Gartner.
“However, there are secondary effects to the rising U.S. dollar. Vendors have to raise prices to protect costs and margins of their products, and enterprises and consumers will have to make new purchase decisions in light of the new prices,” he added.
The Gartner Worldwide IT Spending Forecast is the leading indicator of major technology trends across the hardware, software, IT services and telecom markets.
In its latest report the advisory firm said, communications services will continue to be the largest IT spending segment in 2015 with spending at nearly $1.5 trillion. However, this segment is also experiencing the strongest decline among the five IT sectors.
“Price erosion and competitive threats are preventing revenue growth in proportion to increasing use within most national markets,” stated the report.
In the device market, mobile phones continue to be the leading segment, with growth in Apple phones, especially in China, keeping overall phone spending consistent. However, overall smartphone unit growth will start to flatten. The PC and tablet markets continue to weaken.
IT services spending in 2015 is projected to decline 4.3 per cent. Gartner expects modest increased spending on consulting in 2015 and 2016. Meanwhile, enterprise software spending is forecast to decline 1.2 per cent in 2015, with revenue totaling $654 billion.
