A highly reputed research firm Gartner has released a promising outlook for global IT spending for the year 2020. As per forecasts, the figure is estimated to reach $3.9 Trillion. Year on year, this translates into an annual increase of about 3.4%.
Although the increase in percentage terms is not that significant, we must keep in mind that this growth comes despite a few major odds. The most significant factor by far is the ensuing trade war between economic goliaths America and China.
The trade related standoff resulted in a never ending viscous circle of imposing tariffs and counter tariffs one after the other. The recent optimistic outlook for IT spending comes amid growing optimism that USA and China are finally prepared to soften their previously rigid stances on trade.
The other major concern was around the overall health of major global economies. It was feared that lackluster economic activity and stagnated growth would propel the global economy into a deep recession but this did not happen, at least to the extent of year 2019.
In the wake of these developments, Gartner anticipates IT executives will feel much more confident in spending big bucks on IT hardware. Within the domain of IT however, we may see a shift in spending trends. A notable increase in spending is expected in the software side.
Spending on enterprise software is likely to touch $530 Billion, marking an increase of 10%, which outranks all other categories. A sizeable chunk of this spending on software side will be scooped up by software delivered over cloud infrastructures. With an increase of just 1%, spending on hardware is expected to be around $688 Billion.
In line with the increasing adoption of cloud based solutions, investment in data center systems will also rebound to around $208 Billion. This will translate into an increase of 1.9%, after witnessing a decline in the previous year. With geopolitical uncertainties lurking around, these predictions will have to be closely monitored.
