Healthcare Will Drive Worldwide IT Spending to $2.8 Trillion in 2019 Healthcare Will Drive Worldwide IT Spending to $2.8 Trillion in 2019
Worldwide IT spending is forecast to grow from $2.46 trillion in 2015 to more than $2.8 trillion in 2019, according to the new report... Healthcare Will Drive Worldwide IT Spending to $2.8 Trillion in 2019

Worldwide IT spending is forecast to grow from $2.46 trillion in 2015 to more than $2.8 trillion in 2019, according to the new report from International Data Corporation (IDC). The new spending guide expands on IDC’s previous IT spending forecasts by providing greater depth and detail on technology expenditures by geography, industry, and company size.

North America (the United States and Canada) will provide the largest share of global IT spending throughout the 2015-2019 forecast period and is forecast to pass the $1 trillion mark in 2017. Europe, the Middle East, and Africa (EMEA) will be the second largest region followed closely by Asia/Pacific. Latin America will be the fastest growing region with a compound annual growth rate (CAGR) of 4.3% while IT spending in North America will grow at a 3.8% CAGR. Asia/Pacific and EMEA will both grow more slowly than the overall market, which is forecast to have a CAGR of 3.3%.

“With the global economy entering a new and uncertain phase, IT spending will be heavily influenced by economic cycles and wild cards over the next five years,” said Stephen Minton, Vice President, Customer Insights and Analysis at IDC. “Recent sluggishness in China has caused severe disruption for emerging markets, while the collapse in oil prices continues to challenge energy producers and stock market volatility poses new questions for investment firms. In many industries, business leaders will turn to IT solutions, including data analytics and infrastructure optimization, to help them navigate the stormy economic waters. For IT vendors, the need is greater than ever for a detailed approach to targeting pockets of growth and opportunity amidst this volatile economy.”

From an industry perspective, the largest IT expenditures will be found in the discrete manufacturing, banking, and telecommunications verticals with each delivering more than 8% of all spending throughout the forecast period. These three industries will be followed by process manufacturing, federal/central government, and professional services. The fastest growing vertical industry over the 2015-2019 forecast period will be healthcare, with a five-year CAGR of 5.5%. Banking and insurance are tied with media and the resource industries for the industries with the second fastest-growing IT spending, each with a five-year CAGR of 4.6%.

In terms of company size, over 40% of overall IT spending will come from very large businesses (more than 1,000 employees) while the small office category (the 70-plus million small businesses with 1-9 employees) will provide roughly one quarter of all IT spending throughout the forecast period. Medium (100-499 employees) and large (500-999 employees) business will see the fastest growth in IT spending, with CAGRs of 4.4% and 4.8%, respectively.

“Organizations from all industries and of varied sizes are investing in a combination of customer-facing initiatives, enterprise-focused projects, and 3rd Platform technology adoption and advancement,” said Jessica Goepfert, Program Director, Customer Insights and Analysis at IDC. “To truly capitalize on this opportunity, vendors would be well served to not only listen to their strategic client’s feedback but also to respond and react accordingly. Knowing the client’s industry is table stakes. In order to become more embedded in their customers’ businesses and make a significant impact, the conversations between vendor and client must change to be process and outcome focused.”

Software spending will be the fastest growing technology market segment with a 6.7% CAGR, led by healthcare and financial services investments, followed by business services at 6.2% with strong spending growth from media and resource industries. In contrast, hardware and IT services spending will grow at rates slower than the overall market. Within the software segment, applications that facilitate enterprise and IT operations, such as enterprise resource management and operations & manufacturing applications, will receive the greatest share of software spending. The fastest growing software categories will be network software, collaborative applications, and data access, analytics & delivery applications.

Hardware will remain the largest market segment overall with roughly 40% of all IT expenditures going to devices, infrastructure, and telecom hardware throughout the forecast period. Telecom hardware including smartphones will represent more than half of all hardware spending through the forecast while PCs will remain an important category of IT spending despite a five-year CAGR of -1.6%. Spending on enterprise infrastructure will be driven by solid growth in the server and storage segments with CAGRs of 2.6% and 3.2%, respectively. Healthcare and telecommunication firms will represent the strongest opportunities here.


No comments so far.

Be first to leave comment below.

Your email address will not be published. Required fields are marked *