IT Spend to Grow 7.1% in 2011

Quarterly estimates for worldwide IT spending show a 7.1% increase in 2011, according to the latest quarterly spending outlook by Gartner, Inc. Gartner analysts revised overall IT forecast spending growth in U.S. dollar terms, up from their first quarter update, when they projected 5.6% growth for 2011.

"It is a bit surprising that we have not seen a more significant impact on our global IT spending forecast as a results of the Japan earthquake and tsunami, but despite widespread concerns about disruptions to the supply of critical components in the initial aftermath of the natural disaster, there has not been a dramatic impact on overall IT spending," said Richard Gordon, research VP at Gartner. "For 2011 as a whole, we expect Japan IT spending to be down in local currency, but we expect a positive growth trend to emerge in the second half of the year and continue into 2012."

Global IT services is forecast to reach $846 billion in 2011, a 6.6% increase from 2010. The computing and hardware segment is poised for the strongest growth with spending forecast to grow 11.7% in 2011.

The popularity of migration to public cloud services is rising at a significant rate, and Gartner's latest forecast found that spending in this area is projected to grow four times faster than spending on overall IT. Worldwide, spending on public cloud services is predicted to total $89 billion in 2011, up from $74 billion in 2010. The market is forecast to reach $177 billion by 2015, according to Gartner.

Gartner analysts say that to put this growth rate in context, public cloud services spending was only about 2% of global IT spending in 2010, and by 2015 the level of spending on public cloud services will be less than 5% of the total spent on IT overall.

"Nevertheless, the emergence and adoption of cloud is an important trend, and in some markets, it's already a significant factor," Gordon said. "For example, at about $10 billion, software as a service (SaaS) already accounts for 10% of enterprise applications software spending, and by 2015 this share is expected to increase to close to 15% and to exceed $20 billion in annual spending."

The Gartner quarterly IT spending forecast delivers the analysts’ perspective on IT spending across hardware, software, IT services and telecommunications segments. These reports help Gartner clients understand market opportunities and challenges. The most recent IT spending forecast research is available here.